GAM shares turnaround plan to return to profitability

Initiatives come following the board’s rejection of Liontrust Asset Management’s offer for the business earlier this year.

GAM Holding has confirmed its first steps in the turnaround plan for the business, aiming to return the company to profitability following a turbulent period. 

The immediate focus for the business is set to be investing in client service and portfolio management, specifically hiring in senior sales and distribution team members focused on Europe and the UK, as well as investment managers for both the luxury brands and credit opportunities strategies.

GAM has already made several new appointments in recent weeks in a bid to grow the business and increase profits, including changes to the group management board. 

Speaking to the recent work, Elmar Zumbuehl, chief executive of GAM, said: “I am delighted to have been able to strengthen the Group Management Board with these appointments and together we will lead the turnaround of GAM […] The continuing strong investment performance and the support from our anchor shareholder Rock means that we can move forward with confidence and with a focus on growth and returning GAM to profitability.”

UK asset manager Liontrust conditionally agreed to acquire its Swiss competitor GAM Holding for £96 million back in May, following murmurs of the deal in April, however the board of GAM Holding subsequently declared Liontrust Asset Management’s offer for the business unsuccessful in August, and an agreement was instead made with Rock Investment SAS and Newgame to finance the business’ liquidity needs. 

Read more – GAM acquisition saga continues as Rock Investments proposes new alternative to Liontrust deal

GAM has confirmed that the financing agreement with Rock which provides CHF 100 million in funding has been completed. The loan term will run until June 2025, with an option to extend by another year.

Rock, in conjunction with the other Newgame investors, will control around 30% of GAM shares once their tender offer has completed, the businesses confirmed.

Anthony Maarek, managing director of NJJ Holding – of which Rock is a subsidiary, said: “GAM is an important long-term strategic investment for NJJ, and we are committed with management to restoring the company to a best-in-class global asset management firm. We view it as the first step in developing an investment pillar in financial services as part of NJJ’s long term strategy.”