Summary
Ares Management, L.P. (ARES) filed an 8-K on October 27, 2015, to report the termination of a previously announced Business Combination and Merger Agreement with Kayne Anderson Capital Advisors, L.P. (KA Parties). The termination was mutually agreed upon and is accompanied by a termination agreement that outlines specific financial arrangements and future business collaborations. As part of the termination, Ares Management will reimburse Kayne Anderson for approximately $30 million in out-of-pocket expenses. Furthermore, Ares Management and its affiliates will invest $150 million in capital to be managed by Kayne Anderson, including commitments to specific energy funds and a separately managed account. This termination event also triggered a special mandatory redemption of Ares Management's 5.250% Senior Notes due 2025, requiring the company to redeem the full $325 million aggregate principal amount of these notes.
Key Highlights
- 1Termination of the Business Combination and Merger Agreement with Kayne Anderson Capital Advisors, L.P. was mutually agreed upon.
- 2Ares Management to reimburse Kayne Anderson approximately $30 million in expenses related to the terminated transaction.
- 3Ares Management and affiliates will invest $150 million in capital managed by Kayne Anderson, including commitments to energy funds and a separately managed account.
- 4The termination triggered a Special Mandatory Redemption Event for Ares Management's $325 million aggregate principal amount of 5.250% Senior Notes due 2025.
- 5The Senior Notes will be redeemed at 101% of the principal amount plus accrued interest.
- 6The termination agreement includes provisions for future collaboration on separately managed accounts and MLP-focused products for one year.
- 7Mutual releases of liability and non-disparagement clauses are included in the termination agreement.