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Alternative Market Briefing

Brookfield Asset Management to acquire 62% of Oaktree Capital

Thursday, March 14, 2019

Laxman Pai, Opalesque Asia:

Brookfield Asset Management plans to acquire roughly 62 per cent of global investment manager Oaktree Capital Management in a cash-and-stock deal, bringing an end to the credit-investment firm's six-year run as a public company.

As part of the transaction, Brookfield will acquire all outstanding Oaktree Class A units for either $49 in cash or 1.0770 Class A shares per unit.

The companies say in a joint release that this represents a premium of 12.4% per Oaktree Class A unit based on the closing prices of both companies on March 12.

Oaktree's board has unanimously recommended that Oaktree shareholders approve the deal. Upon the deal's closing, Oaktree will become a private company, according to the release.

Both Brookfield and Oaktree will continue to operate their respective businesses independently, with Howard Marks continuing to serve as co-chairman of Oaktree, Bruce Karsh as co-chairman and chief investment officer and Jay Wintrob as CEO.

When the deal closes, Oaktree will retain voting control and 8 of 10 board seats.

The two companies together will have about $47bn in assets under management. Oaktree had $120bn in AUM as of Dec. 31, with 76% in credit strategies.

Commencing in 2022, former employee-unitholders will be able to sell their remaining Oaktree units to Brookfield over time pursuant to an agreed upon liquidity schedule and approach to valuing such units at the time of liquidation, an......................

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