BrightSphere and the management team of Landmark Partners LLC have entered into an agreement to sell 100% of the equity interests in Landmark to Ares Management Corporation. BrightSphere to receive approximately $724 million in cash for its 60% ownership interest in Landmark and its co-investment in Landmark funds
BrightSphere Investment Group Inc. announced that it has entered into a definitive agreement to sell its 60% ownership interest in Landmark Partners LLC (“Landmark”) to Ares Management Corporation for $690 million. As part of the transaction, Ares will also acquire the 40% ownership interest in Landmark held by the Landmark management team for $390 million, for a total transaction value of approximately $1.1 billion for 100% of Landmark Partners LLC.
“Reconciliation of Landmark GAAP net income attributable to controlling interests to Adjusted EBITDA”
In addition to acquiring BrightSphere’s equity interest in Landmark, Ares has also agreed to acquire BrightSphere’s co-investments in Landmark funds, which had a book value of approximately $34 million as of December 31, 2020. BrightSphere anticipates total after-tax proceeds from the transaction of approximately $630 million, including proceeds from the sale of co-investments.
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The transaction is subject to customary regulatory approvals and closing conditions and is anticipated to close in the second quarter of 2021.
Suren Rana, BrightSphere’s President and Chief Executive Officer said, “Landmark is combining with one of the top leaders in the alternatives business for whom Landmark brings highly strategic, complementary and synergistic capabilities. I would like to thank the remarkably talented team at Landmark for their important contributions to BrightSphere. We sincerely wish them the best in all their future initiatives.”
“The valuation received in this transaction unlocks significant value for BrightSphere’s shareholders and we believe again highlights the high intrinsic value embedded in our businesses relative to our stock’s current trading levels. Our remaining business continues to be strong with best-in-class quantitative strategies offered through Acadian as well as fundamental strategies through TSW and private alternatives strategies through Campbell Global,” Mr. Rana added.
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Founded in 1989 and acquired by BrightSphere in August of 2016, Landmark specializes in secondary market transactions in private equity, real estate and infrastructure funds and investments. As of and for the year ended December 31, 2020, Landmark had $18.4 billion in assets under management, with GAAP management fee revenue of $146.8 million and contributed GAAP net income attributable to controlling shareholders and Adjusted EBITDA to BrightSphere of $12.3 million and $42.2 million, respectively.1
Morgan Stanley & Co LLC acted as financial advisor to BrightSphere. Goldman Sachs & Co. LLC acted as financial advisor to Landmark. Ropes & Gray served as legal advisor to BrightSphere and Landmark. RBC Capital Markets, LLC and Credit Suisse Securities (USA) LLC acted as financial advisors to Ares and Kirkland & Elis LLP served as their legal advisor.
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