Acadian Asset Management Inc. current report, 30 March 2021

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Business Context and Reporting Period

This Form 8-K was filed by BrightSphere Investment Group Inc. on March 31, 2021, reporting an agreement entered into on March 30, 2021. Although the request identifies Acadian Asset Management Inc., the filing’s registrant is BrightSphere Investment Group Inc. The transaction concerns the divestiture of Landmark Partners, LLC.

Transaction and Key Financial Terms

  • BrightSphere, through BrightSphere (Landmark) LLC, agreed to sell its 60% interest in Landmark Partners to Ares Holdings L.P. for $690 million in cash.
  • The other 40% interest, held by Landmark Investment Holdings LP, will be sold for $390 million consisting of cash and equity interests in the buyer.
  • The transaction implies total enterprise value of $1.08 billion and will be completed on a cash-free, debt-free basis.
  • The buyer also agreed to acquire BrightSphere’s carried interest and co-investments in Landmark funds for approximately $34 million, subject to specified cash-flow adjustments.
  • The filing does not provide revenue, profit, cash flow, margin, debt, liquidity, or earnings-per-share data for the reporting period.

Material Changes Versus the Prior Comparable Period

The filing reports a pending divestiture rather than periodic operating results. It does not provide comparable-period financial statements or quantify the expected impact on BrightSphere’s revenue, earnings, cash flow, assets, or debt.

Outlook, Conditions, and Unusual Items

  • Closing is subject to customary conditions, including antitrust clearance under the Hart-Scott-Rodino Act, Hong Kong regulatory clearance, absence of injunctions and a material adverse effect, and satisfaction of specified representation and warranty conditions.
  • At closing, Landmark’s investment advisory client revenue run-rate must be at least 80% of the run-rate as of January 1, 2021.
  • No specified key-person event or similar event may occur for designated Landmark funds.
  • The agreement includes customary termination provisions and may be terminated if closing has not occurred by September 30, 2021.
  • Purchase price remains subject to adjustments for cash, debt, working capital, transaction expenses, and changes in client revenue run-rate.
  • The agreement contains no indemnification provisions; the buyer obtained representations and warranty insurance.
  • Management commentary and detailed forward guidance are not included in the provided filing text. A related press release was furnished as Exhibit 99.1.

Investor Verification Checklist

  • Confirm the identity of the registrant and whether the filing is relevant to Acadian Asset Management Inc.; the provided filing is for BrightSphere Investment Group Inc.
  • Verify final cash, equity, and purchase-price-adjustment amounts at closing.
  • Confirm whether required antitrust and Hong Kong regulatory clearances were obtained and whether the transaction closed by September 30, 2021.
  • Assess the effect of the Landmark divestiture and the approximately $34 million carried-interest and co-investment sale on BrightSphere’s financial statements.
  • Review the furnished Exhibit 99.1 press release and subsequent filings for closing status, use of proceeds, tax effects, and updated guidance.