Summary
Ares Management Corporation (ARES) has announced a significant acquisition, agreeing to acquire the international business of GLP Capital Partners Limited (GCP International) for approximately $3.7 billion. The transaction is structured with an initial consideration of $1.8 billion in cash and $1.9 billion in equity, comprising shares of Class A common stock and restricted stock units (RSUs). This equity component is expected to represent about 6% of Ares' outstanding shares as of September 30, 2024. In addition to the initial consideration, the acquisition includes an earn-out provision of up to $1.5 billion, contingent on achieving financial targets related to the growth of Japan and data center businesses through the end of 2027. Ares has the option to pay up to 85% of this earn-out in its Class A common stock, potentially leading to further equity dilution. The deal is anticipated to close in the first half of 2025, subject to regulatory approvals and other closing conditions. Ares has secured a $2.0 billion bridge loan facility to support the cash portion of the acquisition, with plans to use cash on hand and potentially other debt or equity issuances.
Key Highlights
- 1Ares Management Corp. to acquire GCP International for approximately $3.7 billion.
- 2Transaction includes $1.8 billion cash and $1.9 billion in ARES equity (Class A common stock and RSUs).
- 3Acquisition is expected to represent approximately 6% of Ares' outstanding Class A common stock post-closing.
- 4Potential earn-out of up to $1.5 billion based on Japan and data center business growth.
- 5Ares may pay up to 85% of the earn-out in ARES stock, subject to pricing conditions.
- 6Acquisition is expected to close in the first half of 2025, pending regulatory approvals.
- 7A $2.0 billion bridge loan facility has been committed to help finance the cash portion of the deal.