8-KOther Events

AFFILIATED MANAGERS GROUP, INC. 8-K Report (Nov 15, 2001)

Filed November 15, 2001For Securities:AMGMGRBMGRMGRDMGRE

Summary

Affiliated Managers Group, Inc. (AMG) announced a significant acquisition on October 31, 2001, by acquiring a 51% majority equity interest in Friess Associates, LLC and Friess Associates of Delaware, LLC for approximately $241.0 million. This strategic move brings a well-established growth equity investment management firm with approximately $6.3 billion in assets under management into AMG's portfolio. Friess Associates is known for its fundamentally-driven investment approach, focusing on growth equities with reasonable price-to-earnings ratios, and advises the Brandywine family of mutual funds as well as institutional and high-net-worth clients. The acquisition is structured with an option for AMG to acquire an additional 19% stake in Friess Associates in three years, subject to certain conditions. The existing management team, including founder Foster Friess, has agreed to long-term employment agreements, ensuring continuity and stability. This transaction was financed through a combination of working capital and borrowings under AMG's existing credit facility, indicating a solid financial footing for this expansion. Investors should monitor the integration of Friess Associates and its impact on AMG's overall assets under management and fee-generating capabilities.

Key Highlights

  • 1AMG acquired a 51% majority stake in Friess Associates for $241.0 million on October 31, 2001.
  • 2Friess Associates manages approximately $6.3 billion in assets under management.
  • 3The acquisition includes an option for AMG to purchase an additional 19% of Friess Associates in three years.
  • 4Friess Associates is a growth equity investment management firm with a long-standing investment philosophy.
  • 5Key management personnel at Friess Associates have entered into long-term employment agreements.
  • 6The transaction was financed using working capital and existing credit facilities.
  • 7AMG is committed to filing detailed financial statements and pro forma information for the acquisition within 60 days.

Frequently Asked Questions

The acquisition of Friess Associates significantly expands AMG's assets under management within the growth equity sector, adding a firm with a strong reputation and a well-defined investment strategy. This move is expected to enhance AMG's overall product offering and fee-generating potential by integrating a successful investment management business into its platform.

AMG financed the $241.0 million acquisition primarily through its existing working capital and borrowings under its $330 million senior revolving credit facility. This indicates that AMG had the financial flexibility to complete the transaction without immediate need for external equity or significant new debt issuance.

The current management team of Friess Associates, including founder Foster Friess, Chief Investment Officer Bill D'Alonzo, and senior investment professionals Jon Fenn and John Ragard, have all agreed to continue overseeing the firm's operations. They have entered into long-term employment agreements, ensuring continuity in investment management and client service.

Yes, AMG has an agreement to acquire an additional 19% equity interest in Friess Associates from the majority selling equity-holder in three years, subject to certain conditions. This suggests a potential for AMG to increase its control and economic interest in Friess Associates over time.