GAM held takeover talks with Zürcher Kantonalbank

Switzerland’s Zürcher Kantonalbank has held takeover talks with GAM, the troubled asset supervisor that delayed its outcomes because it races to discover a purchaser this month.

ZKB, the biggest of Switzerland’s state-owned cantonal banks, has had discussions with GAM in current months about buying the enterprise, based on folks accustomed to the scenario.

GAM, which contains an funding administration arm and a fund companies division, in February pushed again the discharge of its annual outcomes to seek out further time to safe a sale. The asset supervisor is because of launch its outcomes on Tuesday.

ZKB and Liontrust, a UK boutique fund supervisor, are amongst a number of potential suitors for GAM, which has endured a spectacular fall from grace since a scandal over its holdings of illiquid debt rocked the corporate in 2018. Its share worth has plunged greater than 95 per cent because the begin of 2018, and final yr the group employed UBS to assist promote the enterprise.

ZKB stated that it “is consistently inspecting alternatives inside its enterprise growth technique” however declined to touch upon “rumours”.

London-listed Liontrust disclosed earlier this week that it was in talks with GAM however cautioned that it might not result in a proper provide.

One other funding agency, New York-based Z Capital Group, has additionally proven curiosity in shopping for GAM, based on an individual accustomed to the matter, because it seeks to increase its asset administration enterprise. Z Capital Group declined to remark.

GAM stated earlier this month that the “board is working tirelessly on choices to make sure that the agency is strategically positioned in the most effective pursuits of all stakeholders”.

One banker stated that GAM was “fairly a posh enterprise” made up of a fund administration division that companies third events in addition to its personal funding administration arm.

As soon as certainly one of Europe’s greatest asset managers, GAM’s troubles started in July 2018 when it suspended former star fund supervisor Tim Haywood with little clarification, prompting traders in its Absolute Return Bond funds, which Haywood managed, to hurry for the exit.

It later transpired that Haywood had purchased bonds regarding Lex Greensill’s now collapsed provide chain finance enterprise Greensill Capital, which counted former UK prime minister David Cameron as an adviser. Insiders at Zurich-based GAM had voiced considerations about Haywood’s relationship with Australian financier Greensill, which finally led to the liquidation of the funds.

Chief govt Alexander Friedman stepped down whereas Haywood was subsequently fired. In 2021 GAM was fined £9.1mn by the UK’s Monetary Conduct Authority for conflicts of curiosity.

Whereas GAM has by no means recovered from the scandal, the corporate stated its funds have carried out nicely, declaring in January that greater than half of its largest merchandise had been ranked within the high decile over the previous three years.

Leave a Reply