(Alliance News) – Liontrust Asset Management PLC on Thursday said it conditionally has agreed to buy Zurich-listed GAM Holding AG in an all-share deal valuing the Swiss peer at CHF107 million, or GBP96 million.

Liontrust shares were down 5.3% at 820.47 pence each on Thursday morning in London, while GAM shares were down 28% at CHF0.58 each in Zurich. GAM shares had jumped by 25% last month when the pair confirmed they were in merger talks. The stock is down 46% over the past 12 months.

Liontrust, a London-based asset manager, said the offer is equivalent to CHF0.67 per share.

GAM has some CHF23.3 billion assets under management and advice as at March 31, and the combination of the firms would create a global asset manager with GBP53 billion in AuMA.

GAM’s portfolio value totalled GBP789 million on the same date.

Should the acquisition receive shareholder approval, Liontrust said it expects it to complete in the fourth quarter. GAM shareholders will have a 12.6% stake in the enlarged Liontrust.

“Liontrust and GAM are both client-centric businesses that thrive on providing solutions and first-class service. The enlarged company will provide the platform from which to deliver this to a broader client base,” said Liontrust Chief Executive John Ions.

GAM has struggled in recent years, worsened by turmoil of supply chain finance firm Greensill Capital. GAM in March 2021 closed the GAM Greensill Supply Chain Finance fund to subscriptions and redemptions as a result.

Before that, it ousted one-time investment director business unit head Tim Haywood head in February 2019 following a probe into misconduct.

The UK Financial Conduct Authority in March 2022 said it fined GAM International Management Ltd GBP9.1 million for “failing to conduct its business with due care and attention” and not properly managing conflicts of interest. Haywood himself was fined GBP230,037.

By Xindi Wei, Alliance News reporter

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