By Gillian Tan
Ares Management LP plans to offer 18.2 million shares in its
initial public offering, with the expectation that shares will
price in a range of $21 to $23, according to a filing Tuesday.
The firm estimates the net proceeds from the offering will be
about $237.5 million.
Ares said it is looking to raise up to $481.3 million in the
offering, which was disclosed in a filing late last month. It
intends to use the proceeds to repay debt and fund growth, among
other things.
Ares, which has assets under management of about $74 billion,
was spun out of Apollo Global Management LLC in 1997. The Los
Angeles-based firm's four key business lines--tradable credit,
direct lending, private equity and real estate--have helped it grow
assets under management at a compound annual growth rate of 31%
over the past 10 years, the company has said.
Ares's market value could be as high as $4.86 billion if the IPO
is priced at the top end of the range and if all outstanding Ares
Operating Group units are exchanged for units in the listed
company.
The bulk of the company's earnings come from management fees
from its more than 140 active funds. The firm posted economic net
income of $430.9 million for the year ended Dec. 31, 2013, down
from $472.5 million in the prior year.
The firm itself will be seeking to sell about 11.4 million
common units, while AREC Holdings Ltd., an affiliate of the Abu
Dhabi Investment Authority, will sell 6.8 million of its 34.2
million units.
In 2013, Antony Ressler, Ares's co-founder, chairman and chief
executive, was the firm's highest earner, receiving $15.5 million
in compensation and a dividend of $123.1 million. Instead of
earning salaries and bonuses, Mr. Ressler and other key Ares
executives are compensated with equity grants, carried interest and
incentive fees.
Mr. Ressler's haul was smaller than that of his brother-in-law,
Apollo co-founder and CEO Leon Black. Mr. Black received $546.3
million in dividends, investment proceeds and compensation for
2013, making him the most richly rewarded executive at a publicly
traded private-equity firm last year.
Following the IPO, which is being led by J.P.Morgan Chase &
Co. and Bank of America Merrill Lynch, Mr. Ressler's 30.2% stake
could be valued at $1.5 billion if the offering prices at the top
end of the range.
Write to Michael Calia at michael.calia@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires