Cantor Fitzgerald has parted company with its entire transition management team, headed by Michael Gardner, and has ceased operations for the foreseeable future, Global Investor/ISF has learned.
The business, part of the portfolio solutions group, was set up just 18 months ago. The decision to close down the London-based team was taken last week but was not announced to the market.
According to Cantor Fitzgerald, the American bank remains committed to transition management and is in the process of replacing its entire team.
However, there is no fixed timetable for it to restart trading and, as things stand, would be forced to turn away clients.
Gardner remains on an interim basis only to wind-up outstanding business. The rest of his five-strong team has already exited.
Transition management teams can form close working relationships so it is not unheard of for a complete group to move to another provider.
Michael Gardner was hired as senior managing director and global head of portfolio solutions at the time Cantor Fitzgerald entered the market, announced 13 April 2015. Gardner will not remain in any capacity with the bank.
A well-known figure within transition management, Gardner was hired with almost a decade of experience at JPMorgan and, before that, almost five years at Bear Sterns before the businesses were combined post-2008.
Before that he was also involved in the creation of Russell Investments’ transition management business.
Transition management providers often need to demonstrate a track record before securing new clients – 18 months is too short a period to build up such a track record. It is known that Cantor had secured overlay-type mandates from clients but no major transitions were reported.
The past few years have been turbulent for the transition management business, with several exits and new entrants. ConvergEx, JPMorgan and Credit Suisse all closed businesses in 2013 but more recently there has been a period of calm.
Cantor was among the new entrants looking to capitalise on the upheaval.
efinancialcareers.com reported in June that FCA records revealed that Cantor Fitzgerald had shed 10% of its registered employees during the first six months of 2016, including some senior names.
Cantor Fitzgerald was contacted but declined to comment.