Ares Management agreed to acquire GLP Capital Partners’ operations outside of China for up to US$5.2 billion ($6.78 billion), in one of the biggest recent combinations in the alternative asset management industry.
Ares will initially pay about US$3.7 billion for GCP’s fund management business in Japan, the US, Europe, Brazil and Vietnam, according to a statement from GLP on Tuesday, which confirmed an earlier Bloomberg News report. Of that amount, Ares will pay about US$1.8 billion in cash and about US$1.9 billion in Class A common shares, the US-based firm said in a separate statement.
The deal also includes an additional earn-out provision of up to US$1.5 billion if certain performance goals are met, GLP said. The upfront cash proceeds would help it reduce liabilities and strengthen the group’s balance sheet, it added.
The acquisition will help Ares Real Estate nearly double its assets under management to about US$96 billion across North America, Europe, Asia and Latin America. Ares said it has secured bridge financing from Morgan Stanley Senior Funding and Citigroup Global Markets for the deal.
Alternative asset managers have been pursuing mergers to gain scale and expand into new sectors and geographies, turning into one-stop shops offering a range of investment strategies.
GCP has traditionally invested in areas such as real estate tied to logistics, digital infrastructure and renewable energy. The firm grew out of Singapore-based GLP, a developer and operator of warehouses that has benefited from the boom in e-commerce. GLP set up a fund management arm to invest third-party money in the sector, and it became a separate entity — GLP Capital Partners — after a series of transactions in 2022.
See also: Ares said to agree on acquisition of GLP Capital Partners’ ex-China business
Michael Steele, president of GCP International, will join Ares as part of the transaction, along with the leadership teams responsible for managing and operating the funds in Japan, Europe, the US, Brazil and Vietnam.
Ming Mei, co-founder and CEO of GLP and GCP, will continue to run GCP’s remaining businesses, which will remain headquartered in Singapore and focus on investing in Greater China. Mei will also become an Ares partner and senior adviser. GLP said that following the deal, GCP will have US$81 billion in assets under management.
GLP’s dollar perpetual bond climbed more than three cents on the dollar on Tuesday, the biggest jump in three weeks, according to data compiled by Bloomberg. The note climbed to 70 cents, the highest since 2022, the data show.
The transaction is expected to close in the first half of 2025, pending regulatory approvals and other conditions.
