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August 13, 2018

GAM to wind up absolute return bond fund range

Swiss money manager GAM has decided to liquidate its unconstrained and absolute return bond fund range (ARBF) following high levels of redemption requests. The move is pending approval from regulators and fund shareholders.

The affected funds are the GAM Absolute Return Bond, GAM Absolute Return Bond Defender, GAM Absolute Return Bond Plus, GAM Star Absolute Return Bond, GAM Star Absolute Return Bond Defender, GAM Star Absolute Return Plus, GAM Star Dynamic Global Bond, GAM Absolute Return Bond Master Fund, and GAM Unconstrained Bond Fund.

The affected funds managed CHF7.3bn in assets at the end of July 2018.

“We believe that the liquidation approach will allow investors the opportunity to receive proceeds in a more timely manner and ensure equal treatment. It is expected that all fund shareholders would periodically receive their proportionate interest in cash as it becomes available throughout the liquidation process. GAM is working with each of the fund boards to maximise liquidity and value for investors,” the Swiss group said in a statement.

At the same time, the asset manager is also working on plans to set up alternative structures for fund shareholders who want to remain invested in the ARBF strategies.

The move follows the suspension of ARBF head Tim Haywood after an internal probe revealed breaches in his risk management and record keeping processes.

The probe did not reveal concerns regarding Haywood’s honesty or evidence of material impact on clients.

Soon after, GAM suspended trading in the ARBF fund range to protect the interests of remaining investors.

 

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