Relativity Media and strategic partner Elliott Management Corp. on Thursday said they will spin off their Beverly 2 co-finance vehicle with Universal to a new affiliated fund managed by Elliott.

A new affiliate, Elliott Media Investments LLC, has been created. New York City-based Elliott also agreed to invest additional capital into Relativity to help further its own 2012 production slate.

The move removes conflicts of interest that have arisen as West Hollywood-based Relativity expanded into distribution, and enables company to focus on producing and distributing its own productions, Chief Executive Ryan Kavanaugh said.

“As our core business of developing, producing and distributing our own product has grown to be competitive in size and scope with the majors, this move allows us to focus our energy on that business,” said Kavanaugh, who is the company’s main shareholder.