Australian wealth manager AMP has unveiled that American private equity firm Ares Management is interested in acquiring 100% of its A$2.25bn ($1.72bn) private markets businesses.
Ares offered a non-binding indicative proposal for AMP last October. The company later backed out of the buyout offer due to concerns regarding the declining performance of AMP’s wealth management arm.
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Last month, Ares struck a non-binding agreement with the wealth manager to create a A$2.25bn joint venture for AMP Capital’s private markets business.
Under this proposal, Ares intended to take a 60% stake in AMP Capital’s private markets business for A$1.35bn while AMP would retain the remaining 40% interest.
The latest update from AMP comes as the 30-day exclusivity period between the companies to reach a binding agreement comes to an end.
AMP said Ares has expressed interest in buying private markets businesses entirely and the companies are currently working towards a potential deal.
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By GlobalData“There is no certainty that a transaction will proceed, or the terms, size or structure on which it would proceed. Any transaction would remain subject to approval of AMP shareholders,” AMP said in a statement.
AMP’s ongoing troubles
The Australian wealth manager has been struggling with plummeting value in the recent years, after a scandal on widespread misconduct within the company caused its clients to turn their backs on the wealth manager.
AMP’s underlying NPAT in FY20 slumped to A$295m from A$439m a year ago. The company also postponed the final dividend for a second year.
Earlier this month, it agreed to offload the global equities business of its asset management unit to Canadian investment manager Fiera Capital.
