private markets business, PrivateMarketsCo, is set to sell its infrastructure debt platform to asset manager Ares Holdings for $428 million.
The financial services provider said the agreement follows PrivateMarketsCo’s decision to focus on its key strength of managing equity investments in real estate and infrastructure, while also simplifying its structure and realising significant value from the proposed transaction to support the growth of these businesses.
Ares Holdings LP is a subsidiary of Ares Management Corporation. AMP said the cash proceeds from the sale will strengthen the capital position of the AMP group.
This transaction values infrastructure debt at around $578 million, comprising $428 million in cash and around $150 million of sponsor investments and rights to carried interest.
“This transaction provides strong outcomes for both our Infrastructure Debt clients and our shareholders. Infrastructure Debt will further accelerate its growth as part of Ares’ global alternative investment platform, benefitting the clients who have supported it through its early stages under our ownership,” said PrivateMarketsCo chief executive Shawn Johnson.
“PrivateMarketsCo and AMP will realise significant value from the divestment, as well as retaining our valuable sponsor investments and carried interest in the closed Infrastructure Debt funds. This will provide a strong revenue stream in coming years as we demerge PrivateMarketsCo and accelerate the momentum in our business.”
The demerger remains on track to complete in late first half of 2022.
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