The Zurich-listed group has been battling to restore its financial health and fortunes after a damaging episode in 2018, which led to the exodus of client money.

Zurich-listed GAM Holding yesterday announced that it made a SFr82.1 million ($90.7 million) loss, on an IFRS accounting basis, narrowing sharply from the SFr290 loss in 2022.

GAM has been battling to recover its fortunes since Tim Haywood, who managed the ARBF business, was suspended in 2018 amid claims of misconduct (he was subsequently dismissed). Clients pulled money out of the firm.

Last August, after moves by UK-listed Liontrust Asset Management to buy GAM fell through, it agreed with investment groups NewGAMe and Rock Investment SAS to extend immediate short-term financing of SFr20 million to cover GAM’s liquidity needs. Rock is a French-incorporated entity that is owned by NJJ Holding, the personal holding company of Xavier Niel, a wealthy French businessman. It is part of the NewGAMe group of investors consisting of NewGAMe SA and Bruellan SA.

Work in progress
Describing work to turn around its fortunes, GAM said that, as previously reported, it completed the sale of its third-party funds business to Carne Group at the end of January this year.

Separately, the firm said it has agreed with Switzerland-based 1741 Group to transfer management company services for the GAM funds in Switzerland. 

“Good progress has also been made in the negotiations with high quality, global firms on transferring management company services for the GAM funds in Luxembourg, Ireland and the UK, paving the way to a simplified, scalable and investment management focused operating model,” GAM said in a statement yesterday. 

“We will complete the transition to a single operating platform, which includes having all investment management activities on our new cloud-based Simcorp platform, by the end of 2024. This will ensure greater efficiency across our global operations,” GAM said. 

Results details
GAM said that on an underlying basis, it logged a pre-tax loss of SFr49.5 million, versus SFr42.5 million in 2022.

Investment management assets under management at SFr19.3 billion were down from SFr23.2 billion as of 31 December 2022.

The firm said 78 per cent of investment management AuM beat a three-year benchmark, and 81 per cent outperformed a five-year benchmark as of 31 December 2023.

To bolster its balance sheet, GAM said it intended to make a rights issue for up to SFr100 million. This will be proposed at its 15 May annual general meeting, and fully underwritten by Rock Investment SAS, a group company of GAM’s anchor shareholder.

Other AGM proposals include the nomination of three experienced board candidates who will increase gender diversity as part of GAM’s commitment to diversity, equity, and inclusion, it said.