Affiliated Managers Group invests in Baring Asia
Affiliated Managers Group (AMG), a US-based global asset management company, has acquired a 15% stake in Baring Private Equity Asia for an undisclosed sum.
The senior partners at Baring will continue to hold a majority position in the business and direct day-to-day operations. The leadership team has agreed to long-term commitments to the firm. According to a memo sent to LPs that was obtained by Fortune - since verified by AVCJ - Jean Eric Salata (pictured) has entered into a 10-year employment agreement to remain CEO and chairman of the investment committees.
The memo also offers insights into why Baring decided to sell part of the GP. "Creating shareholder value at the firm level, which is something that has already been done by several of our global competitors who have raised capital from the public markets directly or sold stakes to private investors, is a strategic tool for further motivating and aligning employees and will help to cement the partnership structure we have in place," it said.
The proceeds from the transaction will be used to fund future commitments to Baring funds, improve the firm's financial flexibility and alignment between LPs and staff, and create a mechanism for the long-term inclusion of the next generation of leaders into the shareholding structure. AMG has also agreed to invest in future Baring funds.
"AMG's investment is an endorsement of our firm's position as a leading Asian alternative asset manager, and its unique partnership model allows us to preserve our investment independence, operational autonomy, and focus on generating strong returns for our clients over the long term," Salata said in a separate statement.
Founded by Salata in 1997, Baring has more than $8 billion in assets under management, having closed its sixth pan-regional fund at $3.98 billion early in 2015. The firm also closed its debut real estate fund last year. The firm has more than 120 employees - including 66 investment professionals - located in Hong Kong, Shanghai, Beijing, Mumbai, Singapore, Jakarta and Tokyo.
US-listed AMG had around $627 billion in assets under management as of September 2015 in more than 500 investment products across a broad range of investment styles. Its strategy is to take equity stakes in leading boutique investment management firms, while allowing those firms to maintain operational autonomy.
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