T Rowe Price Group is to acquire alternative credit manager purchase Oak Hill Advisors and certain other entities that have common ownership for a purchase price of up to approximately $4.2 billion.
$3.3 billion is payable at closing, approximately 74 per cent in cash and 26 per cent in T Rowe Price common stock, and up to an additional $900 million in cash upon the achievement of certain business milestones beginning in 2025.
The purchase price includes the retirement of OHA debt outstanding at closing. Excluding amortisation of intangibles and the expense impact of the earn-out, the transaction is expected to be accretive to T. Rowe Price diluted earnings per share by a low-to-mid single digit percentage in 2022.
OHA, a leading alternative credit manager, will become T Rowe Price’s private markets platform, accelerating T Rowe Price’s expansion into alternative investment markets and complementing T. Rowe Price’s existing global platform and ongoing strategic investments in its core investments and distribution capabilities. Alternative credit strategies continue to be in demand from institutional and retail investors across the globe seeking attractive yields and risk-adjusted returns.
Read more/Source: Private Equity Wire
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