The art of smoothing it over

This week as Liontrust’s attempt to takeover rival asset manager GAM collapsed after shareholders refused to approve the GBP96 million deal, we are reminded of the importance of effective negotiation in ensuring these types of tricky acquisitions complete successfully.

Liontrust revealed 33.5 per cent of GAM shareholders voted for its proposed deal, falling short of the required majority support.

Liontrust chief executive John Ions expressed disappointment that the takeover, which has been on the table for months, will not go ahead but said he was grateful to those who worked so hard to try to make it succeed.

This week we speak to Hadley Chilton, Partner at Cork Gully, a firm with 100 years’ experience overseeing changes to funds’ structures, ownership and strategies, about just how difficult it is to get acquisitions over the line.

Hilton has recently overseen Cork Gully’s expansion into Luxembourg, as the demand for support with restructuring grows apace.

Importantly, Cork Gully is focused on avoiding what Chilton describes as the ‘nuclear option’ in other words liquidation, which rarely serves in the best interests of investors.

There have been a series of well publicised property fund liquidations, some of which have dragged on for more than two years, as asset managers fail to sell off illiquid assets. Meanwhile, in the emerging equity space the Russian invasion of Ukraine has caused several asset managers to close funds that were subject to suspension.

And few in the industry could have failed to notice the issues surrounding the closure of Crispin Odey’s flagship hedge fund amid accusations of sexual misconduct.

Restructuring experts are, according to Chilton, central to ensuring the smooth transition of a fund, whether the circumstances are contentious or not.

On 28th August the nominations survey will open for the Institutional Asset Manager service provider awards 2023. Be ready to nominate your favourite service providers in the institutional asset manager awards.

Gill Wadsworth, Editor

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When Odey Asset Management asked investors to support a move of its oldest fund to a rival firm amid sexual misconduct allegations against founder Crispin Odey, the financial world was reminded of the more salacious reasons an asset manager might embark on a restructuring.

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