GAM Enters Talks With Billionaire Niel as Liontrust Offer Fails

2023-08-24 15:27

GAM Holding AG has entered into discussions with French billionaire Xavier Niel’s NewGAMe SA and the Bruellan investor

GAM Holding AG has entered into discussions with French billionaire Xavier Niel’s NewGAMe SA and the Bruellan investor group over a takeover of the company, after Liontrust Asset Management Plc’s bid failed to gather enough votes.

“The GAM Board recognises the importance of GAM shareholders determining a change in the GAM Board composition and looks forward to receiving the NewGAMe proposals for a future Extraordinary General Meeting,” the firm said in a statement on Thursday.

The offer from NewGAMe opens a fresh chapter in a tumultuous period for the Swiss asset manager that began five years ago and involved the shuttering of nine funds and the dismissal of star bond trader Tim Haywood.

Only 33.64% of GAM shareholders accepted Liontrust’s offer, meaning the firm will have to walk away. Shareholders originally had until July 25 to tender their shares to Liontrust, but the London-based asset manager announced three consecutive extensions as it tried to drum up enough support.

In May, GAM’s board agreed to Liontrust’s all-share offer worth 107 million Swiss francs ($122 million), which would have created a $66 billion global asset manager.

GAM’s decision to accept Liontrust’s bid drew immediate opposition from some of its investors. NewGAMe, which has been the most vocal opponent, said Liontrust’s bid undervalued the company. The group also made its own partial offer for GAM, as well as bridge financing to replace loans made by Liontrust of about 20 million Swiss francs in the event the latter’s tender offer for the firm is unsuccessful. NewGAMe’s offer is expected to conclude on Sept 28.

In a separate statement on Thursday, Liontrust said it currently expects to declare the offer unsuccessful. The bid would lead to a one-off exceptional charge of not more than £11 million ($14 million), Liontrust said.

“Liontrust made a full and fair offer for GAM, which reflected the financial reality of the business and would have provided a certain and sustainable solution,” Chief Executive Officer John Ions said in the statement.

(Updates with Liontrust statement)