GCM Grosvenor Announces $85 Million Upsizing of Term Loan to Enable Repurchase of Mosaic Assets

Rhea-AI Summary

GCM Grosvenor (Nasdaq: GCMG) plans to upsize its Term Loan by $85 million to acquire Mosaic Assets, valued at $238 million as of March 31, 2021. The transaction involves repurchasing fund investments of $87 million and unrealized carried interests worth $150 million, at an estimated purchase price of $176 million. This move is expected to enhance shareholder value and simplify the company’s structure. The transaction is projected to close in the third quarter of 2021.

Positive

• Transaction expected to be immediately accretive to shareholders.
• Expected increase in the value of carried interest and investments associated with Mosaic.

Negative

• Transaction funded through a mix of balance sheet cash and debt, potentially increasing financial strain.

CHICAGO, June 14, 2021 (GLOBE NEWSWIRE) -- GCM Grosvenor (Nasdaq: GCMG), a global alternative asset management solutions provider, announced today that it will seek to upsize its Term Loan by $85 million to enable the repurchase of certain fund investments and rights to future carry associated with Mosaic (collectively, the “Mosaic Assets”). Based upon values as of March 31, 2021¹, GCM Grosvenor will repurchase assets and carried interest at net asset value of approximately $238 million (consisting of fund investments valued at $87 million and unrealized carried interests net asset value of $150 million) and rights to additional future carried interest associated with $423 million of carry dollars at work, for an estimated March 31, 2021 purchase price of $176 million (the “Transaction”). The Mosaic Assets generated realized carried interest earnings of $14.7 million² over the twelve-month period ended March 31, 2021 and realized investment income of $1.5 million over the same period.

“In addition to being an immediately accretive transaction to our shareholders and simplifying our structure, we believe there is considerable upside provided by the long-term growth in the value of the carried interest and investments associated with Mosaic,” said Michael Sacks, Chairman and Chief Executive Officer of GCM Grosvenor. “Over the last quarter alone, we saw Mosaic’s unrealized carried interest at NAV increase by 31% to $150 million as of March 31, 2021.”

The Transaction, funded by a combination of balance sheet cash and debt, is expected to close in the third quarter of 2021.  

About GCM Grosvenor

GCM Grosvenor (Nasdaq: GCMG) is a global alternative asset management solutions provider with approximately $65 billion in assets under management across private equity, infrastructure, real estate, credit, and absolute return investment strategies. The firm is in its 50th year of operation and is dedicated to delivering value for clients in the growing alternative investment asset classes.

GCM Grosvenor’s experienced team of approximately 500 professionals serves a global client base of institutional and high net worth investors. The firm is headquartered in Chicago, with offices in New York, Los Angeles, Toronto, London, Tokyo, Hong Kong, and Seoul. For more information, please visit: www.gcmgrosvenor.com.

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¹ The value of the Mosaic Assets is subject to change based on interim cash flows and changes in values between March 31, 2021 and actual Transaction date
² The amount shown represents the redeemable noncontrolling interest had the transaction occurred on March 31, 2021 and included all tax carry attributable to the Mosaic interests from such time forward, consistent with Mosaic’s rights to carry for all future periods

Source: GCM Grosvenor

Public Shareholders Contact
Stacie Selinger
sselinger@gcmlp.com
312-506-6583

Media Contact
Tom Johnson and Will Braun
Abernathy MacGregor
tbj@abmac.com / whb@abmac.com
212-371-5999

FAQ

What is GCM Grosvenor's planned transaction with Mosaic Assets?

GCM Grosvenor plans to upsize its Term Loan by $85 million to repurchase Mosaic Assets valued at $238 million.

How will the repurchase of Mosaic Assets affect GCM Grosvenor's shareholders?

The transaction is expected to be immediately accretive to shareholders and simplify the company’s structure.

When is the expected closing date for GCM Grosvenor's transaction?

The transaction is projected to close in the third quarter of 2021.

What is the estimated purchase price for the Mosaic Assets?

The estimated purchase price for the Mosaic Assets is $176 million.