When hedge fund manager Rudolf Bohli acquired a stake in GAM, shares surged. Now, with the reason for the surge removed, the share price is due to fall.
Rudolf Bohli, a hedge fund manager based in Zurich, knew how to stir up emotions at GAM. Having acquired a 3 percent stake in the asset manager, he put himself and two partners forward for election to the board. Bohli wanted to replace CEO Alex Friedman and to initiate a massive cost cutting program.
The bid for change at GAM was welcomed by some shareholders and the stock added more than 30 percent in value. Today, the shares tanked after Bohli told «Finanz und Wirtschaft» that he had sold his stake again.
Ambitions Don't Match
After meeting Hugh Scott-Barrett, the new chairman of GAM, he concluded that the ambitions of the board didn’t match his own, Bohli said. The hedge fund manager mandated Credit Suisse with the placement of his stake.
«I have made a healthy profit and I’m satisfied,» Bohli told the business newspaper. The majority of the shareholders had opted against his proposals, which he respected. He preferred not to make the same proposals for a second time.
Compensation Under Review
Bohli’s bid to take responsibility at GAM nevertheless has had some lasting consequence. The compensation system is under review and GAM has mandated a restructuring manager.
