(Bloomberg) -- GAM Holding AG’s third largest shareholder is not supporting Liontrust Asset Management’s bid to take over the Swiss money manager.

Gem, an alternatives manager headquartered in New York, has decided not to accept Liontrust’s offer, according to an email seen by Bloomberg. Gem held a stake of 6.5% in GAM through its Global Yield fund as of May, according to data compiled by Bloomberg. 

The decision will create an extra hurdle for Liontrust as it tries to build support among GAM shareholders. In an open letter published Friday, London-based Liontrust urged investors to tender their shares by July 25, saying the offer was “the only one on the table and the only proposal that provides a viable solution.”  

On Thursday, it said that Silchester International Investors, which is GAM’s biggest shareholder with a 17.3% stake, was backing the proposal.

Liontrust declined to comment. Gem did not respond to a request for comment.

In May, GAM’s board agreed to Liontrust’s all-share offer worth 107 million Swiss francs ($124 million), which would create an enlarged company managing a £53 billion ($66.7 billion). GAM has suffered years of declining assets under management, revenues and profitability since a tumultuous period that began in 2018 and resulted in nine funds closing and the dismissal of star bond trader Tim Haywood.

But the proposal has met resistance from some shareholders, who are questioning the price and logic of the deal. They include a group created by French billionaire Xavier Niel that now owns just under 10% of GAM and has called for a shareholder meeting in August to elect a new board. The group is awaiting regulatory approval to increase its stake further.

In GAM’s annual general meeting in May, some shareholders drew parallels between the Liontrust deal and investors who lost out in the recent UBS Group AG takeover of Credit Suisse.

--With assistance from Paula Doenecke.

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