Back in the game: Shares in Martin Gilbert’s AssetCo have gone up 90 per cent in the past year
At the age of 66, when others would be spending even more time on the golf course, larger-than-life money man Martin Gilbert is staging a full-scale City comeback.
Not that he has anything against golf – quite the reverse.
One of the many friends and acquaintances he has made through the game is no less a personage than Donald Trump.
Nothing, though, not even 18 holes with a US President, is allowed to get in the way of his deal-making. Gilbert, through his new company AssetCo, has just agreed to take control of River & Mercantile for £100million.
The bid, he hopes, will mark his return as a major force in the Square Mile.
He made his name at Aberdeen Asset Management, the firm he founded in 1983 and built into a £300 billion savings business, with some thrills and spills along the way.
Never shy of speaking his mind, he weighs in on the question on every small investor’s mind: is it time to get out of tech shares and back into traditional ‘value’ stocks?
Despite the recent rout, he is firmly in the tech camp and would like to see more of these high-risk, high-growth shares on London markets.
Britain’s flagship share index, the Footsie, has become a stamping ground for lumbering, old-fashioned corporate giants, and not enough whizzy tech stocks.
This is why, he says, its performance looks dreary compared with the Nasdaq index in the US.
‘The FTSE 100 is dated. Only 2 per cent of it is made up of technology companies, compared with the 20 per cent tech weighting in global indexes,’ he says.
It’s a controversial view and not necessarily a popular one with the legions of small investors who have put money into savings products which track the Footsie.
But he adds: ‘One of the big failings of London is we have really not succeeded in getting a big tech stock here listed in the FTSE100.’
Many commentators are predicting a tech bust. They fear the likes of Zoom, Amazon and Tesla, pandemic favourites that have since fallen, are due an even bigger hammering.
Gilbert, however, is ‘not convinced’ there will be ‘a massive rotation’ out of tech and back into old-fashioned value shares – and adds he is ‘just pleased to see a correction and a bit of sanity in the market.’
His investment acumen is not in doubt, and nor is his joviality.
He loves entertaining – social isolation must have been torture – and he particularly adores holding court at the annual jaw-fests at Swiss ski resort Davos.
The elite event, which has not been staged during the pandemic, wouldn’t even be Davos without his craggy presence at one of his fabled whisky parties.
He knows everyone who is anyone and likes to invite them to the Highland Games in Braemar, where he sports bold tartan trews.
The convivial exterior, however, masks a steely core of ambition. The returns he has achieved for investors have even been compared favourably with Warren Buffett, the world’s greatest investor. Admittedly, the numbers suggesting this were crunched by Numis, one of his corporate advisers, but even so.
Asking how he feels about being likened to the US maestro provokes a rare outbreak of sheepishness.
‘I wish I was half as good as Warren Buffett,’ he says, looking embarrassed. ‘He is a legend. I like his style.’
One area in which the UK could shine, he says, is green tech and renewable energy.
‘This sector has huge growth potential. Let’s be very clear, as a fund manager you won’t win any mandates unless you have credentials in ESG – environmental, social and governance.’
His enthusiasm for the green agenda might seem to sit uncomfortably with his role as senior independent director of commodities giant Glencore. But, he says, instead of demanding companies sell off problem assets, investors are now urging responsible ownership.
‘If you just divest assets, they are likely to go into less responsible hands. There is a bit more pragmatism about that,’ he says.
Shell’s decision to abandon its plans to invest in the Cambo oilfield off the Shetland Islands has, he says, ‘bemused people’ in Aberdeen. ‘What people can’t understand there is why we wouldn’t develop our own oil and gas supply rather than import it.
‘There has to be a move to net zero. But if we are just going to import oil and gas, then I am failing to understand the logic.’
Following the deal to buy River, Gilbert denies he is aiming to turn his new vehicle AssetCo into another Footsie funds giant as he did with Aberdeen. No one, though, would put it past him.
Gilbert is back in the game after the 2017 merger of his Aberdeen business with Standard Life turned out not to be a match made in heaven. The buccaneering culture at Aberdeen was very different to staid Edinburgh stalwart Standard Life. To no one’s great surprise, Gilbert left the company, now known as Abrdn – an odd name he claims to like – a couple of years after the merger.
The hope for AssetCo is that he will replicate the rapid growth in early days of Aberdeen in the 1980s and 1990s. Maybe he will: AssetCo shares have risen more than 90 per cent in the past year, compared with Abrdn, which has lost more than 20 per cent.
Gilbert’s other main corporate job is chairman of fintech firm Revolut, though he expresses affection for the traditional banks. ‘I will always keep my Bank of Scotland account because I just like having it. The fintechs have already got to a position of sustainability. But I think the banks still have a huge advantage, because they have the clients. I would buy UK bank shares. Yeah, they are now safe utilities with a dividend.’
He admits, though, he ‘can’t remember the last time I was in a branch, it must be ten years ago’.
In his long career he has shown an extraordinary ability to bounce back from disasters that would have felled a lesser operator.
The ‘split capital’ affair of the early Noughties is now nearly forgotten, but at the time it was, in Gilbert’s own words, ‘a near-death experience’ for Aberdeen. The firm was accused, along with others, of mis-selling investment trusts as low risk when they were nothing of the sort. Thousands of small investors saw their savings wiped out.
Gilbert and his colleagues were denounced by MPs as ‘sophisticated snake oil salesmen’ and Aberdeen had to pay £78million compensation. To his credit, Gilbert has never tried to duck responsibility.
A couple of years ago in Davos, he quipped that his career was at the ‘back nine at golf stage’, suggesting he was ready to start winding down. Few believed him, and they were right.
Now he says he will ‘never’ retire. ‘Why would I? Experience counts in fund management. It is not like most industries where you get worse as you get older.’
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