(Bloomberg) -- Blackstone Group Inc. leaned on a rival firm to part ways with one of its former senior executives in an unusual rebuke.

Mike Whitman departed private equity firm General Atlantic just months after joining in a newly created senior role, according to people with knowledge of the matter. His sudden exit in June came after Blackstone executives protested to General Atlantic over a contract dispute involving another of its alumni.

Whitman previously had various high-ranking roles within GSO, the giant credit arm of Blackstone. The fissure follows tension over senior leaders who have left the $121 billion credit unit, including all three of the founders who gave the group its name. Tripp Smith -- the S in GSO -- and his new firm has been cause for particular consternation, and that fractious relationship played a key role in Whitman stepping away from his new gig.

Departing executives at investment firms across Wall Street agree to a number of limitations to their career paths in exchange for unlocking monetary rewards. Those typically range from non-compete restrictions to non-solicitation clauses that limit their work with former colleagues.

Smith’s separation pact with Blackstone restricts the people he can hire from GSO to work directly for his new firm, Iron Park Capital, people familiar with the matter said. But when Smith formed a joint venture with growth-oriented private equity firm General Atlantic, Whitman joined the latter as the head of capital solutions.

Worked Closely

The two University of Notre Dame graduates had previously worked closely when Whitman led GSO’s European operations. Whitman was expected to play a key part in the new joint venture, known as Atlantic Park, which is raising $5 billion.

Executives at Blackstone objected to what they saw as a workaround to the restriction on Smith poaching former colleagues, the people said. They leaned on General Atlantic to part ways with Whitman, saying they were looking to enforce contract terms, one of the people said.

Whitman and his new employer agreed to split to help resolve the dispute with Blackstone, one of the people said.

Contract disputes rarely play out publicly on Wall Street, and disagreements are often settled with concessions and waivers. But the pressure applied on Whitman was meant to send a message that Blackstone isn’t going to be lax when it comes to such agreements, according to the person briefed on the conversations.

Representatives for Blackstone, General Atlantic, Iron Park and Whitman declined to comment.

Atlantic Park

The move comes at a strained time for GSO, which last fall had to offer concessions to investors alarmed over the departure of key investing executives, then battled a dramatic downturn in markets in the first quarter. The unit is likely to benefit from the second-quarter rebound, results that will show up when Blackstone reports earnings later this month.

Smith is still moving forward with the Atlantic Park joint venture, which this week held a so-called first close of $2.6 billion, more than half its $5 billion target, some of the people said. The GSO founder has also completed raising $1 billion for a standalone fund dubbed WIN, for “winter is now,” which will focus on distressed-credit opportunities emerging from the market rout.

Smith’s debut fund at Iron Park -- WIC, named for the “winter is coming” motto from the television series “Game of Thrones” -- liquidated after scoring a 57% gain before shuttering in March.

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