A two-year legal stand-off between U.S.-based bond trader PIMCO and its founder and former boss Bill Gross has proved expensive for the Allianz subsidiary.
Mr. Gross and PIMCO executives, in a joint press release Monday, said they had reached an amicable settlement. They did not disclose details, but according to media reports quoting sources familiar with the agreement’s terms, PIMCO agreed to pay $81 million (€74.7 million) to the bond guru.
Mr. Gross will also get a “Founders’ Room” named after him at PIMCO’s headquarters in Newport Beach, California, along with the launch of a “Bill Gross Award,” the investment firm said.
Mr. Gross, 72, co-founded PIMCO in Newport Beach, California, in 1971 and grew the company into the world’s largest bond trader. In 1999, Munich-based insurance giant Allianz bought a 70-percent stake in the company. The legendary investor known as the “Bond King” now works with Janus Capital, a significantly smaller investment management firm.
A year after he left PIMCO in September 2014 amid a dispute with management, the “Bond King” filed a $200-million lawsuit against his former employer, alleging his ex-colleagues had forced him out of the company.
“PIMCO has always been family to me, and, like any family, sometimes there are disagreements,” Mr. Gross said Monday, adding that he was satisfied that PIMCO’s founders had received “the recognition they deserve.”
The joint release Monday noted that “any proceeds from the suit will be donated to charity.”
Katharina Kort is a Handelsblatt reporter based in New York. To contact the author: firstname.lastname@example.org.