Ares Management to float public offering

Reports indicate the firm, which has $74bn of assets under management, is on the verge of filing for an IPO that would see it join the likes of The Blackstone Group and Kohlberg Kravis Roberts as a public entity.

Ares Management is preparing to file for an initial public offering, according to reports by Bloomberg and Reuters.

The reports indicated the $74 billion firm would file its IPO plan with the US Securities and Exchange Commission in the coming days or weeks.  A firm spokesperson declined to comment.

Ares’ decision to pursue an IPO would group the firm alongside fellow asset managers The Carlyle Group, Oaktree Capital Management, The Blackstone Group and Kohlberg Kravis Roberts, all of which opted to go public in recent years.

Like each of those firms, Ares has expanded its product offerings since its launch in 1997. The firm initially pursued investments in the leveraged loan, high yield bond and private debt markets, eventually building out its investment platform to include robust holdings in real estate and private equity.

As of 31 December, the firm managed assets across four core investment platforms, which include a $28 billion tradable credit platform and a $27 billion direct lending business. Ares also manages $10 billion in assets through its five private equity funds and a $9 billion real estate platform.

The firm raised its first private debt fund in 2004, the same year it launched its business development company,  Ares Capital Corporation. ARCC is already traded on the Nasdaq exchange and has $8.1 billion in total assets. 

Earlier this year, TPG Capital co-founder David Bonderman said that his firm had also contemplated a public offering, adding that limited partners have not withheld commitments from publicly traded managers.

Some have argued that public shareholder interests oppose those of fund LPs. While both benefit from returns reaped by fund investments, shareholders also demand regular distributable earnings, which are partially generated by management and performance fees paid by fund LPs and portfolio companies.

“The LPs have not put their money where their mouth is,” Bonderman  said.