K2, co-founded in 1994 by William Douglass and David Saunders, is a fund of hedge funds solutions provider. It has a global presence with 115 employees in the US, UK, Japan, Australia and Hong Kong, and approximately US$9.3 billion in assets under management as of 31 August 2012.
This acquisition is expected to enhance Franklin Templeton’s alternative investments and multi-asset solutions platforms.
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The proceeds of this acquisition by Franklin Templeton will be used by K2 to purchase all of the equity currently held by TA Associates and to retire all of K2’s debt obligations.
As per the agreement, the current management of K2 will not sell any of its interests at this time and will receive no up-front consideration in this transaction.
Franklin Templeton said it will acquire the remainder of K2 over a multi-year period beginning 2016.
The transaction is subject to certain conditions including regulatory approval and is expected to close in the calendar fourth quarter of 2012.
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By GlobalDataDouglass and Saunders, K2’s founding managing directors, have entered into long-term employment arrangements in connection with the transaction and will continue to manage the business.
