McGrath to Retire From Man Group
By Bill McIntosh, Senior Financial Correspondent | Friday, July 27, 2007
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Mr. McGrath, 55, joined Man in 1980 when it was primarily a soft commodities trader known as ED&F Man Group plc—a business that had been founded by James Man 200 hundred years earlier. Mr. McGrath rose through the group, becoming chief executive in 1990, and led the broker, with a small but growing hedge fund business, to a public listing in 1994. The announcement of Mr. McGrath's departure comes just days after Man floated 80% of its brokerage arm, MF Global Ltd., for $2.9 billion in the United States Previous HedgeWorld Story. And it follows just months after the resignation of Stanley Fink, the chief executive since 2000, when he was replaced by Peter Clarke in April. Mr. McGrath recruited Messrs. Fink and Clarke and was responsible for promoting them through the business. His resignation was preceded by that of Kevin Davis, the CEO of MF Global, who left Man's board when the brokerage listed July 19. The new non-executive chairman is Jon Aisbitt, a non-executive director since 2003, and a former partner and managing director of investment banking in the United Kingdom at Goldman Sachs. Mr. Aisbitt, 50, retired after 20 years with Goldman in 2002 following a four-year stint as chairman of the investment bank's Australian operation, where he led a team advising the federal government on the 2001 privatization of Telstra, the national telecoms operator. With the spinoff of MF Global, Mr. McGrath is understood to believe that the time is right to step back and concentrate on philanthropy. Although a non-executive chairman since 2000, Mr. McGrath remained an active member of the management team and often represented Man to the media and investors. He also served as the public face of the group in presenting on live television the annual Man Booker Award for fiction and the Man Booker International Award for fiction translated into English. The group undertook the £1 million annual sponsorship of the literary gala in 2002 and last year agreed to a five-year extension of its involvement to 2011. Ultimately, however, Mr. McGrath's legacy will be his vision in overseeing Man's expansion into the hedge fund sector in the late 1980s. The first hedge fund the group set up—Mint—could be plausibly interpreted as a prophecy for the significant sums investors in Man Group would eventually make from its IPO. The experience with the early quant fund helped Man and Mr. McGrath to recognize the opportunity that investing in AHL might afford in 1992. Mint was eventually shut down but Man acquired all of AHL and the quant fund now has assets under management of $17 billion. Man, through such later acquisitions as RMF and Glenwood as well as organic growth, now has $70 billion under management. The group also announced two new non-executive directors with asset management backgrounds. Joining is Phillip Colebatch, 62, who rose through his career to the executive board of Credit Suisse. He was most recently a member of the executive board and group executive director and division head of capital management and advisory at SwissRe. Also joining the board is Patrick O'Sullivan, 58, a chartered accountant who served on the group management board and as chief growth officer at Zurich Financial Services. Both men begin duties on Sept. 1. Under Mr. Clarke and the new management team Man is evolving its investment offering. A group already with no real peer in the hedge fund industry for marketing and distribution, Man is looking to drive additional sales by expanding into new areas, particularly Japan and Australia, which have emerged as big markets. It is also looking to develop a team of intermediaries in Hong Kong and eventually China, while limbering up for a push to boost its presence in the United States. |
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