Pimco's New Turnaround Man: Manny Roman -- Update
July 20 2016 - 7:16AM
Dow Jones News
By Laurence Fletcher and Giles Turner
In Manny Roman, Pacific Investment Management Co. may have found
the tough turnaround specialist the giant U.S. bond manager has
been looking for.
French-born Mr. Roman, a 52-year-old former Goldman Sachs banker
and serial deal-maker, is widely credited with leading a turnaround
at hedge-fund group Man Group PLC that has included a raft of big
acquisitions to diversify the business and sweeping changes to his
management team.
Known for his ruthlessness, collection of French wines, keen
intellect and willingness to spend hours talking about his beloved
Arsenal F.C., a soccer team in the English Premier League, Mr.
Roman took over the reins at Man Group--then a struggling
company--in early 2013.
The London-based hedge-fund firm had for years been battling
client outflows and losses from its flagship computer-driven hedge
fund AHL. It had also been tainted by the revelation it had
invested around $360 million with Bernard Madoff, the man behind
the biggest financial swindle in history.
Mr. Roman arrived at Man Group with its 2010 takeover of
London-based GLG Partners, a firm of hedge-fund traders known for
its tough culture, where he was a co-chief executive. The takeover,
seen by many at the time as gamble by Man Group, was a clash of
cultures epitomized by Mr. Roman's rise to the top.
One employee at AHL, which uses highly complex mathematical
models to trade markets, described the deal as being "like the
chess club taking over the football team."
Mr. Roman was made Man Group's president and chief operating
officer but was seen by many insiders as the power behind the
throne. He eventually took over the CEO role from Peter Clarke, Man
Group's former finance director, in early 2013, after a contest in
which many observers saw only one eventual winner.
Mr. Roman embarked on a trail of acquisitions including
Boston-based Numeric Holdings and Connecticut-based Silvermine
Capital, capped bonuses and appointed Sandy Rattray head of AHL,
which went on to become one of the world's top-performing hedge
funds in 2014.
"This is a loss for Man," said RBC Capital Markets analyst Peter
Lenardos. "Manny had a respectable tenure at Man Group.
"However, Man has other talented senior executives. Jonathan
Sorrell, the CFO, immediately comes to mind," he said.
Pimco, a unit of German insurer Allianz SE, made the decision to
hire a new senior executive a few months ago, with a focus on
corporate strategy, according to a person familiar with the hiring
process, which was led by the firm's chief investment officer,
Daniel Ivascyn.
The search evolved into a hunt for a chief executive, involving
Allianz. At the same time, Allianz also announced the hiring of
Jacqueline Hunt as a management board member overseeing Pimco,
starting in July. She replaced Jay Ralph, a strong defender of
Pimco before the departure of co-founder and Chief Investment
Officer Bill Gross in 2014.
" Doug Hodge has done a terrific job of leading Pimco through
what was a challenging time," said Ms. Hunt in a statement,
referring to Mr. Roman's predecessor at Pimco.
Mr. Hodge, who reported to Ms. Hunt, will now focus on
relationships with Pimco's clients.
Soon after taking up the reins at Pimco, Mr. Hodge told The Wall
Street Journal there was a "overwhelming" sense of relief and
excitement at the giant asset manager following the departure of
Mr. Gross.
While Mr. Hodge focused on the public face of the company, Mr.
Gross's investment management role was taken up by Mr. Ivascyn. A
series of deputy CIOs were also appointed, as the manager attempted
to move away from the autocratic style of Mr. Gross.
Pimco quickly ended its move into global equities, a drive
backed by Mr. Gross, leading to the departure of one of its new
CIOs. The manager also made changes to how its junior employees
were handled and placed a greater emphasis on team management.
Client withdrawals from its flagship Total Return bond fund that
Mr. Gross managed have since slowed. Investors pulled a net $800
million from the $86.4 billion fund in June, according to
Pimco.
Write to Laurence Fletcher at laurence.fletcher@wsj.com and
Giles Turner at giles.turner@wsj.com
(END) Dow Jones Newswires
July 20, 2016 07:01 ET (11:01 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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