Odey chief executive David Stewart said the new partnership was part of a continuing move by the hedge fund pioneer into the private client arena.
"It may go beyond a joint venture eventually, but first we are going to see how it goes,” said Odey ceo David Stewart of the deal with Bruellan Wealth Management, which he described as an “extension” of Odey’s Guernsey wealth management business, launched in June 2008.
“It is a joint venture, so no money is changing hands. We will provide Bruellan with our investment management skills, while they will expand our client base into Switzerland.”
As currently structured, the arrangement will run until the end of 2012, Stewart said, at which point a decision will be taken about whether Odey Bruellan, as the newly-formed company is called, would continue to exist and if so, whether it might at that point be acquired by Odey.
Geneva-based Bruellan is headed by partner and chief executive Antoine Spillmann, whose background includes more than 15 years in London, and it has offices in Gstaad, Verbier and the Swiss ski resort town of Crans-Montana. Its website, www.bruellan.ch, offers three language options — French, English and Russian — as well as a link to Odey’s website.
Changing Swiss wealth management landscape
In addition to taking Odey further into private wealth management, the partnership with Bruellan also represents an effort on Odey’s part to take advantage of a shift in Switzerland’s wealth management landscape caused by the pressure on Swiss banks to give up one of their main attractions to investors – secrecy.
This pressure, mainly from cash-strapped governments like the US, UK, Germany and Italy, is forcing Switzerland’s formerly secretive banks to compete more on a performance basis with wealth managers in other jurisdictions, according to a statement issued by Odey Bruellan – which suggests that for many of these banks, performance has not been a strong point.
The statement quotes Odey founder Crispin Odey as saying fund management in Switzerland has traditionally been “about tax planning and secrecy but not performance – lots of process but little judgement”.
But with the UK and Europe steadily “destroying” their financial services businesses with high taxes and regulation, Switzerland is going the other way, Odey adds – noting that Bruellan is among those Swiss wealth managers who have been at the forefront of this change.
Odey manages more than $6bn (£4bn, €4.7bn) , while Bruellan looks after assets of more than SF1bn ($900,000, £600,000, € 709,000).
