Summary
Ares Management Corporation (ARES) has announced a material definitive agreement through an 8-K filing on March 30, 2020, detailing a share purchase transaction with Sumitomo Mitsui Banking Corporation (SMBC). The agreement involves the sale of approximately $383.8 million of newly issued Class A Common Stock to SMBC, with the transaction expected to close on March 31, 2020. This transaction also includes the creation of a new series of non-voting common stock, which SMBC may exchange its newly acquired shares for. Furthermore, an Investor Rights Agreement will be established, granting SMBC certain rights, including the potential to appoint a board observer and a director nominee under specific ownership thresholds. The issuance is being conducted under an exemption from registration, indicating a private placement to an accredited investor.
Key Highlights
- 1Ares Management Corporation entered into a Share Purchase Agreement with Sumitomo Mitsui Banking Corporation (SMBC).
- 2The agreement involves the sale of approximately $383.8 million of newly issued Class A Common Stock to SMBC.
- 3The transaction is expected to close on March 31, 2020.
- 4A new series of non-voting common stock will be created, with an option for SMBC to exchange its shares.
- 5An Investor Rights Agreement grants SMBC board observer and potential director nomination rights based on ownership levels.
- 6The share issuance is being made under Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D, indicating a private placement.
- 7Ares Management Corporation also issued Class C Common Stock to Ares Voting LLC, a non-economic class of stock related to voting power.