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German consultant GSC ends tie with PPCmetrics

GERMANY – GSC, a German investment consultant, has ended its two-year joint venture with Swiss partner PPCmetrics after they failed to agree on strategy and services.

As a result of the break-up, which GSC described as “friendly,” GSC’s sole owner Georg Seil will acquire the 49% stake PPCmetrics held in the venture.

Wiesbaden-based GSC said it would retain its name and that it would “continue to enjoy the very successful quantitative and qualitative growth of the last years.”

Beyond several dozen one-time projects in the past, GSC has six standing consulting mandates from institutional clients who collectively have €10bn in assets. Two of these mandates are from German pension funds and three are from banks.

GSC and PPCmetrics hooked up in October 2003. GSC, a second-tier consultant, was known for its expertise in asset-allocation advice and performance analysis, while PPCmetrics specialises in asset manager searches.

Seil told IPE that the differences of opinion with PPCmetrics were mainly in two areas: controlling of asset managers and asset liability studies.

“It was so difficult to explain to our Swiss partner that controlling of asset managers is not a service a German consultant typically provides,” he said. “These days, that is usually handled by a master fund (entity responsible for back-office fund administration).

“We also had trouble explaining that while there is certainly big potential for asset-liability studies, clients take their time in deciding to conduct them. I think this process was too slow for them,” Seil added.

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