Pacific Current Group Limited (PAC) a global multi-boutique asset management firm, has acquired a 35 per cent stake in Banner Oak Capital Partners (Banner Oak), a private equity real estate firm.
Banner Oak is a Dallas-based alternative investment manager offering a private equity real estate strategy focused on the creation and growth of fully integrated private real estate operating companies. Currently, Banner Oak manages approximately USD5.7 billion in assets across its platform.
PAC is making an initial investment of USD35.0 million (AUD48.2 million). The agreement also includes an “earn out” provision that could result in Banner Oak receiving additional consideration of up to USD5.0 million. PAC will receive 35 per cent of the management company’s earnings, excluding carried interest. The agreement also includes provisions that will provide PAC with more than its 35 per cent pro- rata share of Banner Oak earnings in the initial years of the investment. PAC classifies Banner Oak as a Tier 1 investment, and estimates its contribution to PAC over the next 12 months to be approximately 25 per cent of PAC’s FY21 underlying NPBT.
PAC has acquired a passive, non-voting minority interest. The transaction will have no impact on the day-to-day management or operations of Banner Oak.
