AUCKLAND: AMP Limited’s PrivateMarketsCo entered into a binding agreement to sell its Infrastructure Debt platform to Ares Holdings LP for a total cash consideration of A$428 million.
The agreement follows PrivateMarketsCo’s strategic decision to focus on its key strength of managing equity investments in real estate and infrastructure, while also simplifying its structure and realizing significant value from the proposed transaction to support the growth of these businesses.
The transaction follows the update provided at AMP’s Investor Day on 30 November 2021 that strong progress has been made on operationally separating PrivateMarketsCo from AMP. The demerger remains on track to complete in late 1H 22.
The cash proceeds from the sale will strengthen the capital position of the AMP Group. Separation of the balance sheet and allocations of surplus capital between AMP Limited and PrivateMarketsCo is continuing as part of the demerger preparations, with a further update to be provided closer to the date of the demerger.
In addition, the transaction will cease the future capital requirements for PrivateMarketsCo for the Infrastructure Debt platform.
Shawn Johnson, PrivateMarketsCo Chief Executive commented: “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.
“Our Infrastructure Debt team has been closely involved and are supportive of the transaction and are committed to ensuring clients’ interests are protected. We are working through a swift separation and transition to minimise disruption for clients and our demerger process.
“PrivateMarketsCo’s go-forward business will be focused on our key strength in managing equity investments in real estate and infrastructure with A$44 billion in AUM, and a pipeline for developing new products that meet the needs of our clients.”
The transaction is expected to complete in Q1 2022 and is subject to the transfer of key employees, applicable client and fund financier consents, no material adverse effect occurring and other customary conditions precedent.
On completion, the entire Infrastructure Debt investment strategy, including A$7 billion in invested AUM on behalf of clients globally, and its investment team will transfer to Ares.
PrivateMarketsCo is a global investment manager with approximately A$50 billion in assets under management as of 30 June 2021 and more than 100 investment professionals supporting clients around the world.