Sources with knowledge of the matter told Bloomberg the Swiss manager had sold off the final assets in the funds on Monday.
They added that investors are due to receive a 50-basis point premium on their holdings in the Absolute Return Bond Fund (ARBF) range which had some £8.5bn in assets when it was frozen following Haywood’s suspension. Gam’s star bond manager was ultimately sacked for gross misconduct, a decision which he is appealing.
The premium is an average across funds and share classes.
Gam declined to comment. Shortly after Portfolio Adviser contacted the Swiss fund group it released a statement confirming it was in the process of settling the sale of the last assets in the ARBF range in line with the plan it sketched out in mid-April.
“The company will further update the market when appropriate,” it said.
Gam said in a pre-emptive update ahead of its H1 results last week that it expected to return the remaining assets to clients by Monday.
It had initially said it would return money to clients by the end of March but extended this deadline to mid-July as it struggled to offload a stub of illiquid assets containing notes linked to projects backed by steel magnate Sanjeev Gupta.
Gam can retain ‘some dignity’
Despite taking three months longer than anticipated to refund ARBF investors Darius McDermott managing director of Chelsea Financial Services said news Gam is paying a premium should be well received. “A 50 bp premium is certainly better than no premium at all,” he said.
Peter Sleep, senior portfolio manager at Seven Investment Management, agreed that given the cost of wind up a “small premium” is better than any discount but said this would provide little relief to those who lost their jobs as a result of the scandal.
“A small premium gets Gam off with some dignity, but I am sure it does not compensate the fund buyers, consultants and employees who lost their jobs for all the stress and hardship they endured in the last year.”
The liquidation of ARBF, one of its most popular fund ranges, has had major ramifications for the Swiss manager, which has seen its assets shrivel by over one third and wreaked havoc on its share price.
Its shares have recovered slightly this year and are currently up 16% at CHF 4.45 but this is still down over 60% from the price they fetched a year ago.
Gam will release its half year results for on 30 July.