8-KOther Events

AFFILIATED MANAGERS GROUP, INC. 8-K Report (Sep 20, 2001)

Filed September 20, 2001For Securities:AMGMGRBMGRMGRDMGRE

Summary

Affiliated Managers Group, Inc. (AMG) has announced a significant strategic acquisition, entering into a definitive agreement to purchase a majority equity interest in Friess Associates, Inc. and Friess Associates of Delaware, Inc. (collectively "Friess Associates"). This move brings approximately $7.1 billion in assets under management, primarily from growth equity strategies, into AMG's portfolio. The acquisition is structured in phases, with an initial 51% stake to be acquired for $247 million in cash, followed by an additional 19% stake three years later at a valuation based on future business performance. This transaction is expected to enhance AMG's asset management capabilities and diversify its offerings, particularly within the growth equity segment, which includes advising the well-known Brandywine Fund. The acquisition underscores AMG's strategy of acquiring stakes in established and successful investment advisory firms. The continued involvement of Friess Associates' current management and key personnel, including founders Foster and Lynn Friess and Chief Investment Officer Bill D'Alonzo, through long-term employment agreements, signals a commitment to maintaining operational stability and leveraging existing expertise. The remaining 30% of Friess Associates will be held by its team members, ensuring continued alignment and incentive.

Key Highlights

  • 1AMG to acquire a majority (initially 51%) equity interest in Friess Associates, an investment advisor with approximately $7.1 billion in assets under management.
  • 2The acquisition price for the initial 51% stake is approximately $247 million in cash.
  • 3Friess Associates advises the Brandywine Fund (BRWIX) and other growth equity mutual funds, as well as separate accounts.
  • 4AMG has an option to acquire an additional 19% stake in Friess Associates in three years, based on future business valuation.
  • 5Key management and investment personnel from Friess Associates, including founders and the CIO, will enter into long-term employment agreements.
  • 6Friess Associates' operations are expected to remain unchanged post-acquisition, with current management continuing to oversee the business.
  • 7The transaction is subject to customary approvals.

Frequently Asked Questions

The acquisition of Friess Associates is significant for AMG as it expands its asset management capabilities and diversifies its product offerings, particularly in the growth equity sector. Friess Associates brings substantial assets under management and a well-established investment discipline focused on companies with high earnings growth, adding a valuable niche to AMG's portfolio.

AMG is committing approximately $247 million in cash for the initial 51% equity stake in Friess Associates. There is also a provision for acquiring an additional 19% stake in three years, with the price to be determined by the business's valuation at that time.

The announcement indicates that Friess Associates' operations are expected to remain unchanged, and current management will continue to oversee the firm's operations. Key personnel, including founders and the Chief Investment Officer, are signing long-term employment agreements, suggesting a focus on continuity and leveraging existing expertise.

Key individuals include founders Foster and Lynn Friess, and Chief Investment Officer Bill D'Alonzo. They, along with other senior investment managers like Jon Fenn and John Ragard, are entering into long-term employment agreements, ensuring their continued involvement and leadership within Friess Associates.