GAM completes the acquisition of absolute return asset manager Arkos Capital
Asset manager GAM has completed buying a majority stake in absolute return Swiss peer Arkos Capital, and agreed with the boutique’s managers on buying the remaining stake in future.
GAM expects to distribute Arkos’s funds under the GAM brand by the end of this year.
In a statement, the company said the management of all investment strategies will remain unchanged after its 75% stake building, and that Arkos’s investment team will be continue to operate from its current base in Lugano.
The deal, approved by the Swiss Financial Market Supervisory Authority, was initially announced in February. It gives CHF 729m manager Arkos access to GAM’s wider distribution opportunities.
Arkos is not the first boutique to seek GAM’s distribution strength.
Shortly after the 2008/2009 crisis, fixed income specialists Augustus Asset Managers agreed to be bought for CHF50.7bn by GAM, for similar reasons.
GAM has historically drawn on the expertise of a number of external groups, to run funds for it. Before the latest move, Arkos already ran low-volatility equity money for GAM, as a wholly independent group.
Other external managers managing assets for GAM are Wadhwani Asset Management in London, for a macro strategy, and Manning & Napier in the US, for a US equities strategy.
GAM has CHF 44.8bn assets under management and approximately 60 separate investment strategies across equity, fixed income, absolute return, funds of hedge funds, discretionary portfolio management and tailored investment solutions.
The trend of consolidation between asset managers in Switzerland is widely expected to accelerate over the next months, as small- and mid-sized firms are impacted by the introduction by the local market watchdog of obligatory regulation, which is equivalent to the EU’s Alternative Investment Fund Managers Directive.