GAM, the Swiss asset manager in the midst of a takeover by Liontrust Asset Management, is engaged in exclusive talks with Carne Group to transfer its fund administration business.
The board of the Zurich-headquartered asset manager earlier this month agreed to a takeover by Liontrust to acquire GAM for £96m.
However, the deal does not include its fund management services business — an entity of GAM with more than 40 asset management clients that carries out functions on their behalf including risk management, distribution and fund administration.
A spokesperson for GAM said the asset manager is in “exclusive discussions with Carne Group” to transfer its fund management services businesses in Luxembourg and Switzerland.
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Founded in Dublin in 2004, Carne is one of the largest third party management groups in Europe, with more than 600 clients and around $2tn of assets under management on its platform.
The talks with Carne, first reported by Bloomberg, come as senior fund managers at GAM have thrown their support behind the Liontrust takeover in an attempt to quell investor concerns about the acquisition.
Fund managers penned an open letter to GAM’s board pledging their “strong support” for the deal.
The letter, sent on 23 May, also cited the “cultural alignment between GAM and Liontrust” and fund managers’ belief that the takeover would “provide the environment and support to enable the investment teams to focus on their clients’ best interests”.
Last week GAM’s board rejected a rival bid from Swiss entrepreneur Marco Garzetti, who tabled an offer via his Taure Invest venture.
Garzetti said his company was prepared to invest CHF65m in cash and “take entrepreneurial risk and personal responsibility to bring GAM back on a stable, sustainable basis”.
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However, the GAM board rebutted the offer saying it “materially undervalued the firm”.
GAM said Taure’s offer would value its shares at approximately CHF0.26 each, whereas Liontrust’s bid valued them more than 2.6 times higher.
Liontrust’s acquisition of GAM is the latest deal for the London-listed group, which will grow assets under management to £53bn when it is completed.
It will expand Liontrust’s distribution capabilities and physical footprint in Europe, as well as broadening its product range to include fixed income, thematic equities and alternatives.
Despite some overlap between the two fund groups, Liontrust chief executive John Ions said earlier this month that the deal was not about “bringing two things together and taking out costs”.
The GAM acquisition comes just over a year after Liontrust completed its £120m purchase of Majedie Asset Management, and three years after it spent £40m on buying Neptune Investment Management — the Hammersmith-based boutique founded by industry veteran Robin Geffen.
In 2020 Liontrust completed its acquisition of Architas’ UK investment management business.
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