OM Asset Management (OMAM) is to acquire a 60 per cent equity interest in Landmark Partners, a secondary private equity, real estate and real asset investment firm.
Under the terms of the purchase agreement, OMAM will pay approximately USD240 million in cash at closing with the potential for an additional payment based on the growth of the business through 2018. The overall investment is expected to result in a purchase multiple of 8-10x Economic Net Income (ENI) generated by the Landmark transaction, prior to financing costs. OMAM intends to fund the closing payment using available capacity on its existing revolving credit facility or may seek alternative sources of debt financing depending on market conditions. OMAM expects the transaction to be up to 12 per cent accretive to 2017 ENI per share. The transaction is expected to close in the third quarter of 2016.
“Landmark Partners has built a dominant position in the secondary private equity, real estate and real asset space, having delivered close to three decades of excellent results for their clients,” says James J Ritchie, OMAM’s Chairman. “Landmark fits comprehensively into our stated acquisition strategy, providing a leading platform in an increasingly important asset class, leveraging the strength of our global distribution group, expanding our range of active strategies for investors, and further diversifying our earnings base by broadening our participation in alternative investment strategies.”
“Landmark is precisely the kind of industry leader with whom we seek to partner,” says Peter L Bain, OMAM’s President and Chief Executive Officer. “The depth and breadth of their management team are exemplary and we look forward to collaborating with them to grow their existing product set and further diversify their business into emerging secondary asset classes. Our global distribution team is excited about bringing Landmark into certain domestic channels as well as new markets outside the US Further, Landmark enhances the quality of our earnings through the stability of its committed capital-based revenue stream, and generates significant accretion to our ENI per share. In sum, we are delighted to partner with the team and look forward to working together to enhance the growth of their business.”
Landmark has a strong track record of successful innovation in secondary private investments. The firm expanded from private equity secondary investments to include real estate in 1996 and real assets in 2015. Landmark is distinguished by its long track record, proprietary transaction sourcing capabilities, and the competitive results it has generated for investors. Landmark has completed over 500 transactions with committed capital of USD15.5 billion since its founding in 1989, and has acquired interests in over 1,900 partnerships, managed by over 700 general partners. The firm is led by its Managing Partners, Francisco L. Borges and Timothy L. Haviland, with a senior team averaging 17 years of experience with Landmark. The firm’s 89-member team operates through locations in Boston, London, New York, and Simsbury, Connecticut. Landmark’s global client base includes institutional investors in the United States, Canada, the United Kingdom, continental Europe, the Middle East, Asia and South America.
“We are pleased to partner with OMAM,” says Francisco L Borges, Managing Partner of Landmark. “OMAM’s partnership orientation combined with our management team’s retention of substantial equity in perpetuity, and ability to offer both growth capital and a strong, broad-based global distribution network were particularly attractive to us. We look forward to working with Peter and the team to continue to grow our business.”
