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Overview of Ares Management Corporation
Ares Management Corporation (ARES) is a globally recognized alternative asset manager, known for its diversified investment approach. The company provides investors with a spectrum of investment solutions, covering credit strategies, private equity, real estate, and secondary market opportunities. Its disciplined investment philosophy and risk-adjusted strategies have consistently enabled it to navigate market cycles, making it a notable name in the alternative investments arena.
Core Business Segments
Ares Management operates through several distinct but integrated investment groups. Each group leverages its specialized expertise while benefiting from the overarching collaborative structure:
- Credit Group: Specializes in a broad range of credit strategies including both liquid and illiquid markets. This segment is crucial for generating revenue, focusing on providing flexible capital through direct lending and other credit facilities.
- Private Equity Group: Manages a variety of corporate private equity investments, infrastructure projects, and special opportunities. Its strategies involve hands-on involvement in growth-oriented companies and operational transformations.
- Real Assets Group: Focuses on comprehensive equity and debt strategies in the real estate and infrastructure sectors. This group is instrumental in creating value through diversified real asset investments.
- Secondaries Group: Engages in investments within secondary markets across multiple alternative asset classes, thereby offering liquidity and strategic repositioning across diverse markets.
- Others: This includes a range of complementary investment strategies that support the company’s holistic approach to alternative investments.
Investment Philosophy and Market Approach
Since its inception in 1997, Ares Management has adhered to a disciplined investment philosophy centered on delivering strong, risk-adjusted returns. The company emphasizes rigorous due diligence, a robust risk management framework, and a deep understanding of market dynamics. This approach allows Ares to capitalize on opportunities across economic cycles while maintaining a diversified risk profile.
Global Presence and Operational Excellence
The company has established a significant global footprint, operating across North America, Europe, Asia Pacific, and other key markets. This expansive presence is supported by a network of offices and a team of experienced professionals who are adept at navigating complex financial landscapes. Its ability to integrate localized market insights with global investment strategies is a testament to its operational excellence.
Competitive Landscape and Differentiation
Ares Management Corporation distinguishes itself through a holistic integration of its investment groups. By sharing research, market insights, and capital across its various segments, the company is positioned to offer innovative and flexible investment strategies that address the needs of diverse investors. This unique collaborative framework not only enhances its competitive edge but also reinforces its commitment to delivering consistent investment performance.
Strategic Value Proposition
The primary value of Ares Management lies in its ability to provide comprehensive alternative investment solutions. The synergy among its credit, private equity, real assets, and secondaries groups creates an environment where cross-segment expertise results in optimized capital allocation. Investors benefit from a structure that prioritizes risk management, flexibility, and long-term value creation within a competitive global marketplace.
Industry-Specific Insights
For industry professionals and investors, Ares offers an exemplary model of diversified asset management. The application of advanced credit analysis, strategic private equity investments, and real asset financing methodologies demonstrates a deep mastery of the alternative investments space. These characteristics, combined with an extensive global network, attest to the company's capability in adapting to varied economic conditions while maintaining operational consistency.
Conclusion
In summary, Ares Management Corporation exemplifies a robust and multi-dimensional approach to alternative asset management. Its disciplined investment strategy, combined with a diversified operational framework and comprehensive market insights, positions it as a significant player in the global investment landscape. The company’s integration of complementary strategies across its investment groups enables it to effectively manage market risks and seize value creation opportunities throughout economic cycles.
GI Partners has acquired Valet Living, the largest full-service amenities provider for the multifamily housing sector, from a fund managed by Ares Management (NYSE:ARES) and Harvest Partners. Valet Living has consistently achieved double-digit growth since its inception, performing over 415 million service events annually across 1.6 million apartment homes. The acquisition aims to enhance Valet Living's innovation and facilitate its nationwide growth, leveraging GI Partners' expertise in accelerating services businesses.
Ares Management Corporation (NYSE: ARES) announced the sale of Valet Living, a leading provider of amenities to the multi-family housing sector, to GI Partners. Valet Living serves over 1.6 million apartment homes across 40 states, offering comprehensive amenities including trash collection and concierge services. Since Ares and Harvest Partners acquired Valet Living in 2015, the company experienced strong double-digit growth and expanded its service offerings. The financial details of the transaction have not been disclosed.
Ares Management Corporation (NYSE: ARES) announced the conversion of a CHF 155 million (€145 million) subordinated mandatory convertible bond in Peach Property Group AG (SIX: PEAN). This conversion makes Ares the largest shareholder in Peach with a 30% stake. The investment is part of a CHF 230 million capital increase aimed at strengthening Peach’s finances for acquiring two significant residential portfolios. Ares has a long-term commitment to the German residential market, leveraging its expertise in public transactions.
EPIC Midstream Holdings has announced a leadership transition, appointing Brian Freed as the new CEO, succeeding Phil Mezey, who will become Non-Executive Chairman. The company aims to shift its focus from project development to improving operational excellence. Freed, previously President since July 2019, is expected to enhance EPIC's position in the midstream sector, particularly in the Permian Basin. This change is viewed positively by investors and stakeholders, as it aims at sustaining the company’s growth trajectory.
Ares Management Corporation announced that CEO Michael Arougheti and CFO Michael McFerran will present at the BofA Securities Future of Financials Conference on November 9, 2020, at 10:30 am ET. A live audio webcast of the presentation will be accessible on the Company’s website, www.aresmgmt.com. Ares Management, listed on NYSE under the symbol ARES, manages approximately $179 billion in assets across Credit, Private Equity, Real Estate, and Strategic Initiatives as of September 30, 2020. The firm operates globally with over 1,400 employees.
Valet Living is providing a year of free amenity services to nominated veterans and military members in San Antonio through its Valet Giving Heroes program. This initiative supports veterans with services like home cleans and pet visits, reflecting Valet Living's commitment to the military community. The program has seen an increase in nominations and aims to alleviate household chore fatigue, which affects many military members. Valet Living, backed by Ares Management, serves over 1.6 million apartment homes nationwide.
Ares Management Corporation (NYSE: ARES) announced significant financing commitments, closing approximately $2.0 billion across 31 transactions in Q3 and $6.4 billion across 95 transactions year-to-date. Key deals include senior secured credit facilities supporting investments in companies like American Technologies, Inc. and EP Wealth Advisors. Ares continues to enhance its presence across various sectors including disaster recovery, financial services, and renewable energy, reflecting its robust investment strategy and commitment to growth.
Ares Management Corporation (NYSE: ARES) reported strong financial results for Q3 2020, with a GAAP net income of $47.5 million, translating to $0.27 per Class A share. After-tax realized income reached $134.1 million, or $0.48 per share, alongside fee-related earnings of $106.8 million. The firm experienced a 24% increase in assets under management, driven by robust fundraising efforts. A quarterly dividend of $0.40 per share will be paid on December 31, 2020. Ares is optimistic about continuing growth in fee-related earnings attributed to its scale and existing opportunities.
Ares Management Corporation (NYSE: ARES) announced the appointment of Raj Krishnan as Partner and Chief Investment Officer of Ares Insurance Solutions (AIS). With over 25 years in insurance asset management, Krishnan joins from F&G Annuities & Life, where he managed a $28 billion portfolio. His role will include overseeing investment management for over 100 insurance clients and supporting Aspida Holdings’ acquisition of F&G Reinsurance Ltd. This strategic move aims to strengthen Ares' asset management capabilities in the life and annuity market.
Ares Management Corporation (NYSE: ARES) will report its third quarter earnings on October 28, 2020, before the NYSE opens. A conference call is scheduled for the same day at 12:00 p.m. ET to discuss financial results. As of June 30, 2020, Ares Management had approximately $165 billion in assets under management, employing around 1,400 staff globally. The company emphasizes its integrated investment strategies across Credit, Private Equity, and Real Estate, aimed at delivering innovative solutions and attractive returns for investors.
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