Ares Management LP said April 25 that its fifth global flexible capital PE fund raised $7.85 billion, surpassing its $6.5 billion target. The $7.85 billion included $250 million of GP commitments mainly from employees and $7.6 billion from third parties. Ares Corporate Opportunities Fund V LP will invest mainly in North American and European businesses.
April 25, 2016 06:30 AM Eastern Daylight Time
LOS ANGELES–(BUSINESS WIRE)–Ares Management, L.P. (NYSE:ARES), a leading global alternative asset manager, announced the final closing of its fifth global flexible capital private equity fund, Ares Corporate Opportunities Fund V, L.P. (“ACOF V” or the “Fund”). Fundraising began in the third quarter of 2015 with an initial target of $6.5 billion. The Fund held its final closing on $7.85 billion of total commitments, which includes $250 million of GP commitments principally from employees and $7.6 billion of third-party commitments. Approximately 80% of the Fund’s limited partner commitments came from existing investors in one or more of the Ares Private Equity Group’s four prior ACOF funds.
ACOF V will continue to execute the investment strategy employed by the prior ACOF funds, pursuing opportunistic investments in primarily North American and European businesses with strong franchises and world class management teams where the Ares Private Equity Group can help unlock additional growth opportunities through its flexible capital. The Ares Private Equity Group has the experience and expertise to execute a range of transactions across market cycles, including traditional control buyouts, growth equity, distressed for control and rescue investments. This flexible capital approach, combined with the additional deal flow and diligence resources provided by the broader Ares Management platform, expands the universe of potential investment opportunities and allows Ares to remain highly selective in its pursuit of compelling risk-reward opportunities in a variety of market conditions.
The Ares Private Equity Group has a long track record, investing for over 12 years across 48 platform investments in the prior ACOF funds. Over this period, the prior ACOF funds have generated an aggregate gross IRR of 23% and a net IRR of 16%. Currently, the ACOF portfolio covers businesses across a variety of industries including companies such as: Smart & Final, Farrow & Ball, National Veterinary Associates, Blackbrush, American Tire Distributors, CPG International and Insight Global. Additionally, the group has demonstrated an ability to deploy capital across market cycles having invested approximately 40% of the prior funds’ capital in distressed situations and 60% in traditional private equity situations.
“We greatly appreciate the tremendous support of our limited partners and thank them for the trust placed in us as responsible stewards of their capital,” said David Kaplan, Co-Founder of Ares Management, L.P. and Co-Head of the Ares Private Equity Group. “We believe that the strong and favorable response of our limited partners to this fundraising process reflects their confidence in the strength of the Ares investment platform, the Private Equity team and our expertise in creating value and driving growth at our portfolio companies.”
“We believe our demonstrated investment discipline, ability to invest across market cycles and consistent track record of performance were integral to a successful fundraise in a short period of time,” said Bennett Rosenthal, Co-Founder of Ares Management, L.P. and Co-Head of the Ares Private Equity Group. “We are excited to have this new pool of capital to deploy in compelling risk-reward opportunities for our limited partners.”
The Ares Private Equity Group had more than $21 billion in assets under management as of December 31, 2015. The Private Equity Group’s activities are managed by three investment teams dedicated to (1) five North American & European flexible capital funds (ACOF V & the prior ACOF funds), (2) five commingled funds and five related co-investment vehicles focused on U.S. power and energy infrastructure and (3) one China corporate growth fund.
Proskauer Rose LLP represented Ares in the establishment of ACOF V.
Ares Management, L.P. is a publicly traded, leading global alternative asset manager with approximately $94 billion of assets under management as of December 31, 2015 and more than 15 offices in the United States, Europe and Asia. Since its inception in 1997, Ares has adhered to a disciplined investment philosophy that focuses on delivering strong risk-adjusted investment returns throughout market cycles. Ares believes each of its three distinct but complementary investment groups in Credit, Private Equity and Real Estate is a market leader based on assets under management and investment performance. Ares was built upon the fundamental principle that each group benefits from being part of the greater whole. For more information, please visitwww.aresmgmt.com.
Statements included herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which relate to future events or our future performance or financial condition. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in our filings with the Securities and Exchange Commission. Ares Management, L.P. undertakes no duty to update any forward-looking statements made herein.
The aggregate gross IRR of the prior ACOF funds is an annualized gross internal rate of return that is calculated on the basis of monthly inflows and outflows of cash to and from investments and unrealized values, assuming such inflows and outflows occurred as of month end and all remaining investments were sold at their values through the end of December 2015. The net IRR is after giving effect to management fees, performance fees and other expenses and exclude commitments by the General Partner and its affiliates who do not pay management fees. We believe aggregated performance returns reflect our overall performance returns in a strategy, but are not necessarily representative of an investment in ARES. For more information regarding calculation of investment performance please refer to the Ares Investor Presentation, dated April 2016 (including the endnotes thereto), which is available at www.aresmgmt.com under “Investor Resources — Presentations and Reports.”