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AFFILIATED MANAGERS GROUP, INC. Annual Report (Amendment), Year Ended Dec 31, 2008

Filing Date
Filed March 31, 2009
Period End
December 31, 2008
In the record · 2016–202610-K1510-Q328-K101

AMG filed 15 annual reports (10-K), 32 quarterly reports (10-Q) and 101 current reports (8-K) between 2016 and 2026.

  1. FY2015 annual report10-K · Feb ’16Feb ’16
  2. Leadership change8-K · May ’19May ’19
  3. Material agreement8-K · Oct ’21Oct ’21
  4. Leadership change8-K · Aug ’25Aug ’25

01—Abstract

Summary

Summary of the 10-K/A filed March 31, 2009. Cited figures are marked; the original filing is the authoritative source.

This Form 10-K/A (Amendment No. 1) from Affiliated Managers Group (AMG) does not contain new AMG financial results.

Its sole purpose, per the explanatory note, is to add audited financial statements of ValueAct Holdings, L.P., a minority-owned affiliate, as Exhibit 99.1 under Item 15. The filing otherwise incorporates AMG's 2008 Form 10-K filed March 2, 2009, and the cover page reports 41,067,763 AMG shares outstanding as of February 25, 2009, with a non-affiliate market value of about $3.64 billiona as of June 30, 2008 (closing price $90.06). Investors should read the amendment as supplemental disclosure about an investee, not as an update to AMG's own performance.

The ValueAct statements show a sharp deterioration in 2008 for the investment partnership. Total assets fell about 39%, from $6.61 billion to $4.02 billionb, driven by lower investments in securities ($3.21 billion versus $5.49 billion) and heavy withdrawals. Minority interests in net losses totaled $1.60 billion, and the partnership's net realized loss ($313 million) and net unrealized loss ($1.29 billion) were large.

Despite this, the partnership reported net income of $17.5 millionc for 2008, compared with a $28.9 million loss in 2007. Partners' capital declined to $72.8 million from $112.4 million, reflecting $58.2 million in distributions. Management fees paid to the ValueAct management company were $59.3 million for 2008, versus $10.2 million in the partial 2007 period.

For AMG shareholders, the key takeaway is that this affiliate, in which AMG holds a minority stake, experienced substantial investment losses and capital outflows in 2008, which is relevant to AMG's equity-method or investment-related exposure. The statements also note that a sub-advisor agreement expired January 1, 2009, reducing one fund's management fee to 0.25%d of limited partners' capital. The 2007 comparative figures are unaudited, and the partnership's auditor (PricewaterhouseCoopers LLP) issued an unqualified opinion dated March 30, 2009.

02—Key points

Key Highlights

  1. The 10-K/A is a limited amendment that adds ValueAct Holdings, L.P. audited financial statements (Exhibit 99.1) and does not change AMG's own 2008 Form 10-K financials.
  2. ValueAct total assets declined about 39% to $4.02 billion at year-end 2008, from $6.61 billion, as investments in securities fell to $3.21 billion from $5.49 billion.
  3. ValueAct reported 2008 net income of $17.5 million, reversing a $28.9 million net loss in 2007, despite net realized losses of $313.5 million and net unrealized losses of $1.29 billion.
  4. Minority interests absorbed a $1.60 billion share of net losses in 2008, reflecting the structure in which outside investors bear most of the fund-level losses.
  5. Partners' capital fell to $72.8 million from $112.4 million, with $58.2 million in distributions and $596.9 million in withdrawals by minority interests during 2008.
  6. The ValueAct management company received $59.3 million in management fees in 2008, and a sub-advisor agreement expired January 1, 2009, reducing a fund's management fee to 0.25%.
  7. AMG's cover page reports 41,067,763 shares outstanding as of February 25, 2009, and a non-affiliate market value of about $3.64 billion at June 30, 2008.

03—One dollar

04—Financials

Financial Highlights

Figures from 10-K/AFY2008filed March 31, 2009
Net Income-$1.32MEPS (Diluted)$-0.03Cash & Equivalents$396.40MFree Cash Flow$498.41M

Financial Statements

SG&A Expenses$201.47M
Operating Expenses$791.50M
Operating Income$366.72M
Interest Expense$73.36M
Net Income-$1.32M
EPS (Basic)$-0.03
EPS (Diluted)$-0.03
Shares Outstanding (Basic)38.21M
Shares Outstanding (Diluted)38.21M

05—Questions

Frequently Asked Questions

  1. Why did AMG file a 10-K/A if its own financial statements were already filed on March 2, 2009?

    The amendment supplements the original 10-K by adding audited financial statements of ValueAct Holdings, L.P., an affiliate in which AMG holds a minority interest, as Exhibit 99.1. The explanatory note states there are no other changes to AMG's 2008 Form 10-K.

  2. How did ValueAct Holdings perform financially in 2008?

    The partnership's total assets fell to $4.02 billion from $6.61 billion, and partners' capital fell to $72.8 million from $112.4 million. It reported net income of $17.5 million after large investment losses, which were largely absorbed by minority interests, compared with a net loss of $28.9 million in 2007.

  3. What does the minority interest line mean, and why is it so large?

    Minority interests represent the share of the controlled funds' results and capital owned by outside investors rather than by ValueAct Holdings itself. In 2008, minority interests absorbed a $1.60 billion share of net losses, so the partnership's own reported net income is small relative to the fund-level losses.

  4. Does this filing reveal anything new about AMG's own 2008 results or outlook?

    No. The document contains AMG's cover page information and the supplemental ValueAct statements only. AMG's own financial results, risk factors, and management discussion are in the original 10-K filed March 2, 2009, which is not reproduced here.

06—Continue

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