GLP Completes Sale of Non-China Fund Business to Ares Management for $3.7B

Industrial giant GLP announced Monday that it has completed the sale of the firm’s ex-China fund management business to Ares Management for $3.7 billion.

The transaction for GCP International, first announced last October, comprises an upfront purchase price of $3.7 billion in a combination of cash and Ares Class A common shares, GLP said in a release. The deal includes an additional earn-out provision of up to $1.5 billion, contingent on reaching certain performance targets.

The exit shows GLP’s success in building an international fund management business and realising value from the firm’s platforms, said Ming Mei, co-founder and CEO of GLP and CEO of GLP Capital Partners.

“We are confident that Ares will be an excellent steward of GCP International, and we look forward to the next chapter of growth for GLP as we strategically optimise our business development plans across each region to further our global trajectory,” Mei said.

Global Investment to Continue

The deal’s closing marks the separation of GCP International from GCP’s remaining business, which will continue to operate independently, based in Singapore, with a focus on investing in Greater China.

Mei is continuing as CEO of the go-forward GLP and GCP and will also support growth initiatives at Ares as a partner and senior advisor of the Los Angeles-based fund manager, GLP said Monday.

Michael Steele, most recently president of GCP International, has become a partner in the real assets group at Ares, and colleagues across GCP International’s global team have joined Ares Real Estate, which continues to be led by co-heads Bill Benjamin and Julie Solomon.

“We are proud to welcome our new team members as we establish a powerhouse in the critical real asset sectors driving the new economy,” Ares CEO Michael Arougheti said in a separate statement. “Together, we have the scale, relationships and experience to benefit from the long-term secular tailwinds that are facilitating unprecedented growth in logistics, digital infrastructure and clean energy assets.”

GLP established its fund management arm in 2011 and scaled the business to $125 billion in assets under management as of last June. The GCP International business acquired by Ares encompasses $42 billion of this AUM, covering Japan, Europe, the US, Brazil and Vietnam.

GLP retains its existing balance-sheet assets and stakes in GCP International funds and will continue to invest globally, it said, with Greater China remaining one of its highest-conviction markets. The firm’s $81 billion fund management platform includes 44 vehicles under management.

US Player Bulks Up in Asia

After acquiring Hong Kong-based distressed debt specialist SSG Capital Management in 2020, Ares hired former KKR real estate executive Bryan Southergill in 2022 and set its sights on buying a property fund manager in the region.

In 2023, Ares expanded its Southeast Asia footprint with the acquisition of Singapore-based private equity firm Crescent Point Capital, adding $3.8 billion in assets under management in the region.

The NYSE-listed company also joined PAG, CITIC Capital, the Abu Dhabi Investment Authority and Mubadala Investment Company last year in the $8.3 billion takeover of Dalian Wanda Group’s primary shopping mall management business.