Ares Management Corporation (NYSE: ARES), a leading global alternative investment manager, has announced a definitive agreement to acquire Landmark Partners, LLC, a prominent firm specializing in secondary private fund investments. This strategic acquisition, valued at $1.08 billion, marks a significant expansion for Ares into the burgeoning secondary market and further solidifies its position as a comprehensive alternatives provider. The deal encompasses approximately $787 million in cash and $293 million in Ares Operating Group Units, subject to adjustments, signaling a strong commitment to integrating Landmark Partners into its operations.
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Landmark Partners, recognized as a pioneer in the secondary private fund market, brings to Ares a substantial portfolio of $18.7 billion in assets under management as of December 31, 2020, across private equity, real estate, and infrastructure secondaries. With a global team of 150 professionals operating from six offices, Landmark has cultivated a strong reputation for providing innovative and flexible transaction solutions to a diverse base of over 600 institutional investors and financial sponsors worldwide. Founded in 1989, Landmark Partners has demonstrated impressive growth, achieving a 17% compound annual growth rate in assets under management over the past four years, driven by the increasing investor demand for private market secondaries.
Michael Arougheti, Chief Executive Officer and President of Ares, emphasized the strategic importance of this acquisition, stating, “We are incredibly proud to announce this transaction with Landmark, a pioneer in developing the asset class of private market secondaries. We believe secondary investments are only increasing in their appeal to a growing group of investors, and we are excited to include these strategies in our comprehensive alternatives offering. We have known Landmark’s leadership team for many years and hold them in high regard for their approach to partnership and demonstrated ability to develop creative, win-win solutions.” He further added, “We look forward to welcoming Frank Borges, Tim Haviland, and their colleagues and we expect significant benefits for our investors, employees, and other stakeholders from this combination.”
Francisco Borges, Chairman and Managing Partner of Landmark Partners, also expressed enthusiasm about the merger, “We are excited to join forces with Ares as we enter this new chapter in Landmark’s history. Ares’ global platform and significant resources will enhance our combined investment capabilities, and my partners and I look forward to driving continued strong performance, transaction structuring innovation, and business growth for many years to come. As a reflection of this optimism, I am very pleased that our management team has agreed to accept significant equity in the combined firm.”
Timothy Haviland, President and Managing Partner of Landmark Partners, highlighted the synergistic potential of the acquisition, noting, “As alternative assets continue to gain share, we believe growth in the secondaries market should also continue to accelerate. We are excited to enhance and expand our already strong market position as a new investment group within the broader Ares platform. Our approach and processes are culturally similar to Ares’, and we look forward to building on key sourcing, relative value, and structuring advantages as well as unlocking new growth opportunities.”
The acquisition of Landmark Partners strategically positions Ares to capitalize on the double-digit growth rates within the secondary market for alternative assets. This market offers unique benefits, providing liquidity to sellers of private market fund interests while enabling buyers to invest in mature portfolios with accelerated cash flows. The secondary market has also evolved to facilitate fund recapitalizations and GP-led secondary funds, further expanding its appeal and utility within the investment landscape.
For Ares, the addition of Landmark Partners expands its product offerings and significantly broadens its client base. The combined platform will serve over 1,600 institutional investors, with a substantial cross-selling opportunity as less than 5% of these clients currently invest with both Ares and Landmark. This merger creates a powerful synergy, integrating Landmark’s secondary market expertise with Ares’ extensive direct lending relationships with approximately 825 financial sponsors and its well-established global network across North America, Europe, Asia Pacific, and the Middle East. This enhanced network and market insight will further strengthen Landmark’s competitive edge in transaction sourcing, evaluation, and structuring.
Michael McFerran, Chief Operating Officer and Chief Financial Officer of Ares, underscored the financial benefits of the acquisition, stating, “The acquisition of Landmark is not only highly strategic, but it is also expected to be immediately financially accretive to Ares’ core earnings metrics, including after-tax realized income per common share, and it should be a meaningful driver of our growth in the years ahead. In addition, the transaction is expected to be accretive to our fee-related earnings margins and further enhances our fee-related earnings composition within our realized income.”
The transaction is anticipated to close in the second quarter of 2021, pending customary closing conditions, including regulatory approvals. Ares Management was advised by RBC Capital Markets, LLC and Credit Suisse Securities (USA) LLC as financial advisors, and Kirkland & Ellis LLP as legal counsel. Landmark Partners and BrightSphere were advised by Goldman Sachs & Co. LLC and Morgan Stanley & Co LLC as financial advisors respectively, and Ropes & Gray served as legal counsel to both Landmark and BrightSphere.
About Ares Management Corporation
Ares Management Corporation (NYSE: ARES) is a leading global alternative investment manager with integrated groups across Credit, Private Equity, Real Estate, and Strategic Initiatives. Ares Management seeks to provide innovative investment solutions and attractive, consistent investment returns for fund investors throughout market cycles. As of December 31, 2020, Ares Management’s global platform had approximately $197 billion of assets under management and more than 1,450 employees across North America, Europe, Asia Pacific, and the Middle East. For more information, visit www.aresmgmt.com.
About Landmark Partners
Landmark Partners, established in 1989, is a leading investment firm specializing in secondary markets. With six global offices and 150 employees, including over 65 investment and research professionals, Landmark has built a strong reputation over 30+ years. The firm has invested in over 2,400 partnership interests, fostering deep relationships with institutional investors, fund sponsors, and market advisors to execute unique and proprietary transactions. Landmark has raised over $28 billion in commitments across more than 30 funds and related vehicles, adhering to a consistent “thought partner” investment philosophy, providing tailored liquidity solutions, and leveraging the benefits of secondary investing. For more information, visit www.landmarkpartners.com.
Forward-Looking Statements
This announcement contains forward-looking statements subject to the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties, including the ability to close and integrate the Landmark Partners acquisition and achieve expected benefits. Actual results may differ due to various factors detailed in Ares Management Corporation’s SEC filings. Ares Management Corporation undertakes no duty to update forward-looking statements.
