New York Life Investments said Thursday that it has agreed to buy a 60% stake in Private Advisors, an alternative investment firm with $3.9 billion AUM. Financial terms were not announced. Private Advisors’ equity holders will retain 40%. The deal is expected to close by Dec. 31, according to a statement.
New York Life Investments today announced that it has signed an agreement to acquire a majority stake in Private Advisors, LLC, a premier alternative investment firm based in Richmond, Virginia. With $3.9[i] billion in assets under management, the firm has a 13 plus year track record across a range of high quality fund of funds, including the firm’s flagship low volatility multi-strategy capability, launched in 1998.
“Private Advisors has a long history of delivering risk-adjusted investment returns, with a strong focus on capital preservation. The firm has a well-defined investment process that incorporates investing in alternative investment managers with proven track records,” said John Kim, president and chief executive officer of New York Life Investments.
Private Advisors is led by founder and managing partner Louis Moelchert, Jr, who prior to the creation of the firm managed the endowment for the University of Richmond for over 25 years. The endowment began investing in alternatives in the early 1980s.
“This is a great opportunity for our clients and our firm. New York Life Investments’ multi-boutique investment structure will enable Private Advisors to preserve its long-standing investment philosophy, its experienced investment team and capabilities – all while benefitting from the resources of one of the most reputable financial institutions in the world,” said Moelchert.
At closing, New York Life Investments will acquire a 60 percent ownership interest in Private Advisors and Private Advisors’ equity holders will retain the remaining 40 percent. A significant portion of the equity holders’ proceeds will be re-invested in Private Advisors’ funds alongside its clients.
“We believe this structure maintains the alignment of interests between our management and our clients, it encourages employee retention, and places an emphasis on the long-term success of the firm,” said Moelchert.
Private Advisors complements New York Life Investments’ alternative capabilities in private equity and real estate as well as its broad suite of equity and fixed income strategies. The firm represents an opportunity for New York Life Investments to acquire a majority interest in a well-respected, institutional firm with over 60 employees, including 21 experienced investment professionals, and a robust infrastructure.
“Private Advisors’ value-oriented investment approach and emphasis on capital preservation are consistent with that of our organization and our investment boutiques. We are very pleased to have such an esteemed group of investors join the New York Life Investments family,” said Kim.
The parties expect to close the deal on or about December 31, 2010.
About New York Life Investments
New York Life Investments ranks among the largest asset management firms in the United States.[ii] Through its multiple boutique management structure, New York Life Investments offers access to leading institutional managers that drive performance. Through MainStay Investments and NYLIFE Distributors LLC, New York Life Investments provides access to some of the most highly regarded mutual funds and wrap accounts in the industry. Together with its affiliates and over 1,400 employees, New York Life Investments manages over $275 billion in assets as of September 30, 2010. New York Life Investments is a leading provider of retirement plans for corporations, multi-employer trusts, and individuals, and is recognized as one of the nation’s top providers of guaranteed products to both the qualified and non-qualified markets.
“New York Life Investments” is a service mark used by New York Life Investment Management Holdings LLC and its subsidiary, New York Life Investment Management LLC.