Bond investor Bill Gross, a managing director of PIMCO, is leaving the company to join Janus Capital.
Gross was one of the founders of Pacific Investment Management Co., or PIMCO, in 1971, and helped build the Newport Beach, California-based investment company into one of the world’s largest bond managers. Today, the company manages almost $2 trillion in assets.
While the announcement of Gross’ departure came as a surprise, reports of tensions among the company’s top managers had surfaced this year, after Mohamed El-Erian, considered by many as Gross’ long-term successor, abruptly resigned in January.
El-Erian, the company’s co-chief investment officer at the time, had helped steer the company through the tumult of the financial crisis and helped develop its concept of “the new normal” — a widely cited idea that economies will grow more slowly after the crisis and big investment returns will be hard to come by.
“While we are grateful for everything Bill contributed to building our firm and delivering value to PIMCO’s clients, over the course of this year it became increasingly clear that the firm’s leadership and Bill have fundamental differences about how to take PIMCO forward,” PIMCO’s Chief Executive Officer Douglas Hodge said in a statement.
PIMCO also said that it had a succession plan in place and a “deep bench of talent,” that would help it cope with Gross’ departure.
Gross will join Janus at the end of the month and manage the company’s recently launched Unconstrained Bond Fund, Janus said in a press release. His first day at the company will be Sept. 29.
Shares of Janus jumped $4.10, or 36%, to $15.15.
Gross will help open a new office in Newport Beach, Calif., focusing on fixed-income strategies.