This communication relates solely to the investment activities of the mentioned Special Situations Investment Funds, which form part of the GAM Alternatives business. Activist engagement is undertaken by the funds’ investment managers in pursuit of the funds’ stated investment objective. It should not be interpreted as a statement of corporate policy or opinion by GAM Investments.
Activist investors Albert Saporta and Randel Freeman cite significant undervaluation, c. 85% share price decline from peak, and misaligned executive compensation. The portfolio managers of the GAM Global Opportunities Fund and the GAM Global Special Situations Fund published an open letter to John Ions, CEO of Liontrust Asset Management PLC (LSE: LIO), calling on the company to commence an immediate strategic review with the objective of selling the business to the highest bidder.
The letter sets out a detailed investment thesis arguing that Liontrust is significantly undervalued, with its share price having declined approximately 85% from its September 2021 peak. Assets under management have fallen from £42.3bn to approximately £22bn over the same period, valuing the company at only 0.68% of AUM. The portfolio managers argue that the current leadership has failed to articulate a credible strategy for reversing this decline and that shareholders would be better served by a sale process given the rapid pace of consolidation across the UK asset management sector.
Albert Saporta and Randel Freeman, who have over 70 years of combined experience in global event-driven and special situations investing, have an established track record of activist engagement that has unlocked trapped value and protected shareholder interests. Recent campaigns include challenging the terms of a proposed tender offer for Yutaka Giken, including through open letters to both Yutaka Giken and Honda Motor and a petition for provisional injunction filed in the Shizuoka District Court, and an open letter to SBI Holdings calling for enhanced transparency and shareholder value maximisation.
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