Despite strong cashflows and a growth in funds under management, a single client’s $1bn redemption has temporarily hit Man Group’s rapid uptick in fortunes following its purchase of GLG last year.
Though Man insisted the client was merely switching assets out of European equities, it wasn’t enough to soften the blow to the group’s shares, which fell nearly three per cent to underperform the FTSE at close yesterday.
But most analysts remain positive about the deal, with Numis calling the Man/GLG tie-up “one of the most powerful forces…in the alternatives space”. The Group’s AHL Diversity fund still seems to be its biggest draw, with 18 per cent of its funds above their high-water marks. The GLG deal was touted as a beefing up of the fund’s capabilities to make it the biggest in the world. But concerns over culture clashes marred the merger, with Man’s hi-tech research model at odds with GLG’s reliance on trader instinct.
At the moment sentiment still seems to remain positive, and in any case a five per cent dividend yield provides a good enough floor for the shares for the time being.