After selling off several stakes, advisory firm Resolute Investment Managers is going on the block again in 2022.
Dreamstime
After failing to find a buyer this year, Resolute Investment Managers, a multibrand financial advisory firm owned by Kelso & Co and Estancia Capital Management, is expected to go up for sale again in 2022, people familiar with the matter said.
Goldman Sachs Group
(ticker: GS) is advising on the revamped Resolute auction, the people said. Kelso and Estancia will try a second time to find a buyer for Resolute, which manages and distributes mutual funds for retail and institutional investors, as well as defined-contribution plans. Resolute has relationships with more than 30 affiliates including investment managers American Beacon Advisors, Continuous Capital, and Shapiro Capital Management.
JPM
) advised on the Resolute auction in 2021 that yielded some interest from private equity but didn’t result in a sale, people said on the condition of anonymity. Kelso and Estancia sought more than $1.5 billion for Resolute, Reuters reported in March.
“JPMorgan is out and Goldman is in,” one of the sources said.
Executives for Kelso, Resolute, JPMorgan and Goldman declined to comment while Estancia did not return messages for comment.
Founded in 1986, Resolute is an asset manager that supplies investment strategies and services to institutions, retirement plans, and retail investors. Kelso and Estancia Capital Management, both private-equity firms, acquired the company, which was then known as American Beacon Advisors, in 2015. Kelso has a majority of Resolute, the company’s website said.
American Beacon changed the name of its parent firm to Resolute Investment Managers in 2017. Resolute then bought stakes in several firms including Ark Investment Management, the asset manager founded by Cathie Wood; direct-indexing firm Green Harvest Asset Management; institutional asset manager SSI Investment Management; financial advisory firm Shapiro Capital; and OpenInvest, a managed-indexing specialist.
The Resolute process is expected to attract private-equity firms and boutique investment firms such as
Affiliated Managers Group
(AMG). But whether it will find a buyer who will pay $1.5 billion is unclear. Resolute’s affiliated companies had about $90 billion in assets under management as of Sept. 30, down from $120 billion in March.
Resolute streamlined its business in 2021, divesting several stakes. The most notable was the sale of its minority holding in Ark. In late 2020, Resolute attempted a takeover of the ETF firm that is known for betting on
Tesla
(
TSLA
), Barron’s reported. Ark in December of that year hashed out a deal where Wood, who is CEO and chief investment officer, remained majority owner of the firm she founded, while Resolute kept its minority holding. This changed over the summer when Ark acquired the stake held by Resolute, three people familiar with the situation said. It’s unclear how much Ark paid for the stake but Resolute did renew its distribution agreement with Ark.
“We can confirm that Resolute no longer has an ownership stake in Ark although Resolute continues to distribute products for Ark,” an Ark spokeswoman said in an emailed response to questions.
ARK was the largest of Resolute’s minority-owned affiliates, Moody’s Investors Service said in a Dec. 6 credit opinion. On a consolidated basis, Ark contributed about $21 billion in net long-term flows over the first quarter of 2021, more than the combined net flows of Resolute’s other affiliates, Moody’s said. However, Resolute’s Ark stake “created lots of disruption and volatility” during the sale process earlier this year, one executive said. Kelso will restart the auction next year without the Ark stake, the people said.
Resolute has also sold its ownership in Green Harvest Asset Management and OpenLink. PGIM Investments, the investment management business of
Prudential Financial
(PRU) completed its acquisition of Green Harvest in December, a notice on the Resolute website said. JPMorgan in August closed its buy of OpenInvest.
PGIM did not immediately return requests for comment.
Write to Luisa Beltran at [email protected]
