Publications

(Article from Registered Funds Alert, February 2015)

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M&A Transactions

• American Beacon Advisors, Inc., a provider of investment advisory services to institutional and retail markets, announced that its parent company, Lighthouse Holdings, Inc., reached a definitive agreement to be acquired by investment funds affiliated with Kelso & Company and Estancia Capital Management, two leading private equity firms. Lighthouse Holdings, Inc. is majority owned by investment funds affiliated with TPG Capital and Pharos Capital Group, LLC. As of September 30, 2014, American Beacon Advisors had $57.2 billion in assets under management.
• Wunderlich Securities, a full-service investment firm headquartered in Memphis, announced an agreement to acquire the wealth management assets of Dominick & Dominick LLC, a privately held investment firm based in New York, New York. Following the acquisition, the purchased business will operate as Dominick & Dominick, a division of Wunderlich Wealth Management, Wunderlich’s private client group.
• American Realty Capital Properties, Inc. announced that it signed an agreement for the sale of Cole Capital, ARCP’s private capital management business, to RCS Capital Corp. for at least $700 million. As part of the transaction, ARCP will act as sub-advisor to Cole Capital’s non-traded real estate investment trusts (the “Managed Funds”) and acquire and property manage net lease real estate assets for the Managed Funds. ARCP also agreed to source, underwrite and acquire U.S. net lease properties for American Realty Capital Global Trust II, Inc.
• BNY Mellon announced that it reached an agreement to acquire Cutwater Asset Management. Upon completion of the deal, Cutwater will operate as part of BNY Mellon Investment Management and will work closely with, and be administered by, Insight Investment, one of BNY Mellon’s investment management boutiques. Cutwater is a U.S.-based fixed income and solutions specialist with approximately $23 billion in assets under management.
• Janus Capital Group Inc. reported that it agreed to acquire VS Holdings Inc., the parent company of VelocityShares, LLC, a provider of exchange-traded products, including exchange-traded funds. As of September 2014, VelocityShares had raised approximately $2 billion in assets across 21 investment products.
• Old Mutual Wealth reached an agreement to acquire Quilter Cheviot for a consideration of up to £585 million. Following approval from regulators, Quilter Cheviot will become the discretionary investment management business within Old Mutual Wealth.
• Austrian lender BAWAG P.S.K. and France-based Amundi Group SA announced BAWAG P.S.K.’s sale of its asset management arm, BAWAG P.S.K. Invest, to Amundi. Amundi, which has more than €800 billion under management, intends to continue operating Invest out of Austria. As of June 2014, Invest had €4.6 billion under management.
• Ares Management, L.P. (NYSE: ARES) announced that its subsidiary reached an agreement to acquire Energy Investors Funds for an undisclosed sum, to be financed primarily in cash, including a portion of the proceeds raised from a prior offering of senior notes by an indirect subsidiary of Ares, and with equity interests in Ares. The transaction was expected to close by the end of 2014 and is subject to regulatory approval. Energy Investors Funds, founded in 1987, is an asset manager in the energy infrastructure industry and has approximately $4 billion of assets under management.
• Affiliated Managers Group, Inc., a global asset management company, announced the completion of its investment in Veritas Asset Management LLP. As part of the transaction, Veritas’ senior professionals agreed to long-term commitments with the firm.
• BlackRock Kelso Capital Advisors LLC entered into an agreement to sell certain of its assets to BlackRock Advisors, LLC, a wholly-owned subsidiary of BlackRock, Inc. Contingent upon BKCA stockholder approval and subject to other closing conditions, BlackRock Advisors will serve as BKCA’s investment manager following the completion of the transaction.
• Securian Financial Group announced that it agreed to acquire a majority interest in Asset Allocation & Management Company, a Chicago-based insurance asset manager, from a private equity fund managed by Stone Point Capital and related investors. AAM will operate independently within Securian following the acquisition and be governed by its own board of directors. Securian is one of the largest financial service providers in the nation, holding close to $46 billion in assets under management and more than $1 trillion of insurance in force. AAM manages $16.4 billion in insurance company assets.
• Mercer, a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC), announced that it agreed to acquire SCM Strategic Capital Management AG, an independent Swiss-based investment advisor and solutions provider for institutional investors. SCM is based in Zurich and has offices in Luxembourg and Hong Kong. The firm is a leading investor for private market fund investments and advises on or manages portfolios with a net asset value of $4 billion.
• New York Life Investment Management subsidiary of New York Life Insurance Co. agreed to acquire Rye Brook, New York-based asset manager IndexIQ. The ETF and liquid alternatives manager, which has 12 funds including its IQ Hedge Multi-Strategy Tracker ETF, will join New York Life’s MainStay Investments platform. The acquisition will add $1.5 billion to MainStay’s $101 billion in assets under management.
• Affiliated Managers Group, announced that it agreed to meaningfully increase its minority ownership interest in AQR Capital Management, LLC. AQR’s principals will maintain majority ownership in AQR, as well as operational independence. Founding Principals Clifford S. Asness, David G. Kabiller and John M. Liew, as well as the firm’s other 18 Principals, entered into long-term commitments with the firm.

Closed-End Fund Initial Public Offerings

BlackRock Science and Technology Trust (NYSE: BST)

• Amount Raised: $420.0 million
• Investment Objectives/Policies: The company’s investment objectives are providing income and total return through a combination of current income, current gains and long-term capital appreciation. Under normal market conditions, the fund will invest at least 80% of its total assets in equity securities issued by U.S. and non-U.S. science and technology companies in any market capitalization range, selected for their rapid and sustainable growth potential from the development, advancement and use of science and/or technology (high growth science and technology stocks), and/or potential to generate current income from advantageous dividend yields (cyclical science and technology stocks).
• Investment Adviser: BlackRock Advisors, LLC
• Book-runners: Morgan Stanley & Co. LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, UBS Securities LLC and Wells Fargo Securities, LLC

Eagle Point Credit Company Inc. (NYSE: ECC)

• Amount Raised: $103.1 million
• Investment Objective/Policies: The fund’s investment objective is to generate high current income and capital appreciation primarily through investment in equity and junior debt tranches of collateralized loan obligations.
• Investment Adviser: Eagle Point Credit Management LLC
• Book-runners: Deutsche Bank Securities Inc. and Keefe, Bruyette & Woods, Inc.

Miller/Howard High Income Equity Fund (NYSE: HIE)

• Amount Raised: $245.0 million
• Investment Objectives/Policies: The fund’s primary investment objective is to seek a high level of current income. As a secondary objective, the fund seeks capital appreciation. The Fund will attempt to achieve its investment objectives by investing, under normal market conditions, at least 80% of its total assets in dividend or distribution paying equity securities of U.S. companies and non-U.S. companies traded on U.S. exchanges. The Fund will terminate on November 24, 2024, absent shareholder approval to extend the term. If the Fund’s Board of Trustees believes that under then current market conditions it is in the best interests of the Fund to do so, the Fund may extend the termination date for one year, to November 24, 2025, without a shareholder vote, upon the affirmative vote of three-quarters of the Trustees then in office.
• Investment Adviser: Miller/Howard Investments, Inc.
• Book-runners: Wells Fargo Securities, LLC, Raymond James & Associates, Inc. and Ameriprise Financial Services, Inc.