Monday 15 July 2019 4:01 pm

Activist investor pressures scandal-hit Gam over compensation

Scandal-hit Swiss asset manager Gam Holding is facing pressure from activist investors to force suspended director Tim Haywood to pay compensation after the firm’s share price plunged last year. 

Czech Republic-based Krupa Global Investments, which owns a one per cent stake in Gam, has called for Haywood, who was fired in February, to compensate investors.

Read more: George Soros builds three per cent stake in scandal-hit asset manager Gam

In an open letter to Gam’s board Krupa asked what steps had been taken to sanction Heywood and receive compensation from him.

“He significantly harmed the reputation of Gam and we believe he should therefore compensate Gam for said damages,” the letter said. 

Krupa said it had built up its stake in order to “make the company more valuable” and called on other shareholders to back its strategy. 

Gam’s share price lost three quarters of their value last year but have gained 10 per cent so far this year. 

“We demand that Gam shall clearly define its further strategy, eliminate disadvantageous investments, and prevent further capital outflows from the company,” Krupa said in a statement.

“We also demand that Tim Haywood shall take responsibility for his actions.”

Read more: Gam Holding sets out plan to pay back investors

Haywood, who was in charge of Gam’s absolute return bond fund (ABRF), was suspended in July last year following an internal investigation into his risk management procedures and record keeping.

The firm also accused Haywood of breaching policy on gifts and entertainment and using personal email improperly. 

Main image credit: Getty