BrightSphere Investment Group Inc. Announces Agreement to Sell Affiliate, Thompson, Siegel and Walmsley LLC
May 09 2021 - 6:25PM
Business Wire
- BrightSphere and the management team of Thompson, Siegel and
Walmsley LLC (“TSW”) have entered into an agreement to sell 100% of
the equity interests in TSW to Pendal Group Limited (ASX: PDL)
- BrightSphere to receive $254 million in cash for its 75.1%
ownership interest in TSW and its seed capital investments in TSW’s
strategies
- Total expected after-tax proceeds to BrightSphere of
approximately $196 million
BrightSphere Investment Group Inc. (NYSE: BSIG) today announced
that it has entered into a definitive agreement to sell its 75.1%
ownership interest in Thompson, Siegel Walmsley LLC (“TSW”) to
Pendal Group Limited (”Pendal") for $240 million. As part of the
transaction, Pendal will additionally acquire the 24.9% ownership
interest in TSW held by the TSW management team, resulting in
Pendal acquiring 100% of TSW for total consideration of
approximately $320 million.
In addition to acquiring BrightSphere’s equity interest in TSW,
Pendal has also agreed to acquire BrightSphere’s seed capital in
TSW strategies, which had a book value of approximately $14 million
as of April 30, 2021. BrightSphere anticipates total after-tax
proceeds from the transaction of approximately $196 million,
including proceeds from the return of its seed capital.
The transaction is subject to customary regulatory approvals and
closing conditions and is anticipated to close in the third quarter
of 2021.
Suren Rana, BrightSphere’s President and Chief Executive Officer
said, “This transaction unlocks significant value for
BrightSphere’s shareholders given the valuation received in the
transaction relative to our stock’s current trading levels. We
expect to use the proceeds from this divestiture primarily to pay
down debt and return capital to our shareholders. Our remaining
business now predominately comprises Acadian, a highly diversified
and differentiated manager providing best-in-class quantitative
strategies and solutions to its clients.”
“We are pleased that TSW will be joining a highly reputed,
global organization that is committed to supporting TSW in their
continued growth. We are thankful to the TSW team for their
important contributions to BrightSphere and wish them the best in
their future initiatives.” Mr. Rana added.
Founded in 1969, TSW applies a value-oriented investment
approach across a range of products in U.S. and international
equities, fixed income and alternative investments. TSW’s singular
objective is to outperform its benchmarks, net of fees, over
rolling three- to five- year periods. As of March 31, 2021, TSW had
$24.9 billion in assets under management, and for the year ended
December 31, 2020, contributed GAAP net income attributable to
controlling shareholders and Adjusted EBITDA to BrightSphere of
$22.1 million and $25.2 million, respectively.1
Morgan Stanley & Co. LLC acted as financial advisor to
BrightSphere on the transaction, while Ropes & Gray LLP served
as legal advisor to BrightSphere.
About BrightSphere
BrightSphere is a diversified, global asset management company
with approximately $141 billion2 of assets under management as of
March 31, 2021. Through its world-class investment management
Affiliates, BrightSphere offers sophisticated investors access to a
wide array of leading quantitative and solutions-based, and
alternative strategies designed to meet a range of risk and return
objectives. For more information, please visit BrightSphere’s
website at www.bsig.com. Information that may be important to
investors will be routinely posted on our website.
Forward Looking Statements
This press release includes forward-looking statements,
including those related to the after-tax proceeds from our
disposition of TSW and the expected closing date of the
transaction. The words or phrases “expect,” “anticipate,”
“estimate,” and other similar expressions are intended to identify
such forward-looking statements, but the absence of these words
does not necessarily mean that a statement is not forward-looking.
Such statements are subject to various known and unknown risks and
uncertainties and readers should be cautioned that any
forward-looking information provided by or on behalf of the Company
is not a guarantee of future performance.
Actual results may differ materially from those in
forward-looking information as a result of various factors, some of
which are beyond the Company’s control, including, but not limited
to, those discussed in the Company’s most recent Annual Report on
Form 10-K, filed with the Securities and Exchange Commission on
March 1, 2021, and subsequent SEC filings, including risks related
to the disruption caused by the COVID-19 pandemic, which has and is
expected to continue to materially affect our business, financial
condition, results of operations and cash flows for an extended
period of time, as well as those related to the expected closing of
the transaction and the satisfaction of necessary closing
conditions. Due to such risks and uncertainties and other factors,
the Company cautions each person receiving such forward-looking
information not to place undue reliance on such statements.
Further, such forward-looking statements speak only as of the date
of this press release and the Company undertakes no obligations to
update any forward looking statement to reflect events or
circumstances after the date of this press release or to reflect
the occurrence of unanticipated events.
Non-GAAP Financial Measures
This release contains references to Adjusted EBITDA, which is a
non-GAAP financial measure. A reconciliation of Adjusted EBITDA to
GAAP net income attributable to controlling interests is included
below. The Company notes that its calculation of Adjusted EBITDA
may not be consistent with Adjusted EBITDA as calculated by other
companies.
Reconciliation of TSW GAAP net
income attributable to controlling interests to Adjusted EBITDA for
the year ended December 31, 2020
$ in millions
U.S. GAAP net income
attributable to controlling interests
$22.1
Non-cash key employee-owned
equity and profit interest revaluations
(5.1
)
Depreciation and amortization
0.4
Income tax expense
7.8
Adjusted EBITDA
$25.2
_______________________________ 1 See “Non-GAAP Measures” and
“Reconciliation of TSW GAAP net income attributable to controlling
interests to Adjusted EBITDA” at the end of this release for more
information. 2 In the first quarter of 2021, BrightSphere announced
the divestiture of Investment Counselors of Maryland and Landmark
Partners, which are each expected to close in the second quarter of
2021. These figures give effect to these divestitures.
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version on businesswire.com: https://www.businesswire.com/news/home/20210509005039/en/
Elie Sugarman ir@bsig.com (617) 369-7300
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