Swiss fund manager GAM has urged investors to back its takeover by Liontrust after a group of shareholders last week launched a rebellion against the deal.
FTSE 250-listed Liontrust, which revealed talks in April, on Tuesday published its takeover prospectus revealing an offer period of 28 June to 25 July with expectations the deal will be be rubber-stamped at the end of 2023 if approved by shareholders.
The deal, which valued GAM at around 107million francs (£94million), has come under fire from a group of investors controlling 9.2 per cent of the Swiss firm’s shares.
GAM board faces pressure from investors over Liontrust takeover ofer
A group comprised of Newgame and Bruellan called the offer ‘inadequate’, arguing it ‘significantly undervalues’ the company and criticising its exclusion of GAM’s fund services arm, which will be offloaded as part of the agreement.
The pair said fellow investors should reject the Liontrust deal and, if they do so, GAM’s board should be ousted and replaced by a set of ‘veterans’ of their choosing.
But GAM’s board, which has agreed to tender its shares in the offer, said on Tuesday it ‘strongly’ recommends investors back the Liontrust offer, adding that the rebel group’s request for an extraordinary general meeting in August ‘does not constitute a competing offer’
Chairman David Jacob added: ‘The board believes that the offer from Liontrust is in the best interests of all stakeholders and will create the stability needed to continue to deliver for clients.
‘Our portfolio managers have indicated their strong support for the offer, and we have had positive feedback from many clients.
‘At the conclusion of the proposed transaction, the resulting business will have a strong balance sheet, a strong Swiss presence, a broader array of excellent investment products, and a global distribution footprint from which to deliver growth, in which our shareholders can participate in the future.’
Liontrust boss John Ions said on Tuesday that the deal would ‘benefit the clients, shareholders and employees of both asset managers’.
He added: ‘We believe our proposed acquisition of GAM can create long-term value for the clients and shareholders of both asset managers.
‘Liontrust has made what we believe is a good offer for GAM and the case for why the acquisition works for all parties.’
