29th Aug 2023 10:15
(Alliance News) - Liontrust Asset Management PLC on Tuesday formally declared its offer to buy GAM Holding AG unsuccessful, and said it can demand repayment of a multi-million-pound sum extended to GAM within the next month.
Liontrust had announced last Thursday that it expected the bid to fail, after winning the support of only a third of Zurich-based GAM's shareholders.
The minimum acceptance condition for the bid was just over 66%, according to an earlier offer document, so the FTSE 250 constituent fell well short of the support needed.
On Tuesday, Liontrust added that it has the right to demand "immediate" repayment of financial support it had provided to GAM via the tranche 1 facility in 30 days times. The amount due is GBP8.9 million plus interest, Liontrust said.
Liontrust previously had noted that it would book GBP11 million in one-off exceptional costs due to the failed takeover attempt.
The FTSE 250 constituent first announced an all-share deal to acquire GAM in May, at the time valuing the company at CHF107 million, around GBP96 million. Liontrust said the offer was equivalent to CHF0.67 per share. GAM shareholders would have held just shy of a 13% stake in the enlarged firm. However, the offer was met with opposition from some of GAM's shareholders.
The sternest opposition to the Liontrust buyout of GAM came from French telecommunications billionaire Xavier Niel, through NewGAMe SA. NewGAMe is controlled by Rock Investment, which is itself owned by NJJ Holding, Niel's personal holding company. NewGAMe, alongside Geneva-based wealth manager Bruellan, back in May said Liontrust's offer undervalued GAM.
Meanwhile, in Switzerland on Tuesday, GAM agreed a short-term financing with Rock Investment of CHF20 million, or GBP17.9 million, to cover its immediate liquidity needs.
NewGAMe also has proposed changing GAM's board of directors with new ones of its own choosing. GAM's shareholders will vote on the matter next month.
Liontrust shares were up 1.7% at 669.00 pence each in London on Tuesday morning, while GAM shares were up 3.1% to CHF0.50 in Zurich.
By Elizabeth Winter, Alliance News senior markets reporter
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