GAM investor group NewGAMe has accused Liontrust CEO John Ions (pictured) of “aggressive tactics which are bordering illegality” following an email sent to the Swiss asset manager’s shareholders.
The deadline for GAM shareholders to tender their shares in support of the Liontrust takeover is today (23 August).
NewGAMe distributed a letter to shareholders yesterday (22 August), raising its concerns over “misleading communications” and accusing Ions of lying in a letter he had sent to GAM shareholders on the 20 August.
The investor group attached an email sent to GAM shareholders by Liontrust head of corporate development David Boyle on behalf of Ions.
In the letter, the Liontrust CEO said that Fermat Capital, a third-party manager for which GAM handles non-US distribution, was backing the firm’s bid for the Swiss asset manager.
Ions also said that, should NewGAMe end up taking control of GAM, Fermat would seriously consider ending its relationship with GAM as the firm’s CEO, John Seo, wouldn’t do business with people “he does not trust”.
See also: Liontrust extends GAM offer period for third time as NewGAMe reveals 100-day plan
After being alerted to the email by a shareholder, NewGAMe director Albert Saporta said he raised the issue with Seo, who then responded: “I am shocked and dismayed by this email. I called John Ions immediately. He will retract the email. I never wrote those words, and I would never approve of those words.”
Saporta said: “With these emails, Liontrust is now disseminating false rumours and information in order to panic shareholders into tendering at the last minute.”
Letters to Liontrust, GAM, and Swiss Takeover Board
The proposed takeover has quickly developed into a saga after months of offer period delays and back-and-forth between Liontrust and NewGAMe.
Following this latest development, director of Rock Investment (which owns NewGAMe) Anthony Maarek wrote to both the Liontrust and GAM boards to raise a complaint over the correspondence.
Writing to Liontrust chair Alastair Barbour, Maarek said: “In situations such as this one, it is not uncommon for the bidder and its opponents to trade barbs. It is also to be expected that each side would approach shareholders and seek to convince them.
“There are, however, limits to what can be decently and legally be undertaken to convince reluctant shareholders to accept an offer. Liontrust has crossed this line and I want to bring this information to your attention directly.”
He added: “Regardless of our disagreements on the merits of Liontrust’s offer for GAM, I hope you can agree with me that this conduct is unacceptable. A CEO of a listed and regulated company should not attribute statements that were never made to significant business partners of GAM, falsely claim that those business partners are seriously contemplating cutting ties with GAM and question the integrity of a third party.”
Rock also wrote to the Swiss Takeover Board, in which the investor group claimed Liontrust had been using “increasingly problematic” methods to further its offer, which it said were “highly problematic from the point of view of takeover law”.
Maarek also informed GAM chair David Jacob, suggesting he should contact the Swiss Takeover Board to distance GAM from the correspondence.
See also: GAM rejects investor group’s EGM delay request
On Monday (21 August), GAM dismissed an alternative funding proposal made by Rock.
The investor had suggested that GAM issue a CHF 25m (£22m) convertible bond to fund itself in the event the Liontrust takeover falls through.
However, the GAM board said that such a transaction would not be a viable replacement for the financing Liontrust is planning to put in place, and is ‘insufficient to maintain GAM as a going concern’.
