Phoenix Investment Partners, Ltd., the wholly owned asset management subsidiary of The Phoenix Companies, Inc. signed a definitive agreement to acquire a majority interest in Kayne Anderson Rudnick Investment Management LLC, a 17-year-old Los Angeles-based investment firm managing over $7 billion in assets. The addition of Kayne Anderson Rudnick will expand Phoenix’s diversified investment capabilities and asset base and support the firm’s managed account growth strategy.
Under the agreement, Phoenix will purchase an initial 60 percent interest in Kayne Anderson Rudnick Investment Management LLC for an amount to be paid in cash based upon management fee revenues at close. An additional payment may be made based upon management fee revenue growth of the purchased business through 2003. The agreement further provides for Phoenix to increase its interest by 15 percent by 2007. The remaining ownership interests will be retained primarily by Kayne Anderson Rudnick portfolio and executive management. The transaction is expected to close in the first quarter of 2002 following receipt of all necessary client approvals. The transaction does not include KA Associates, a broker/dealer, or Kayne Anderson Capital Advisors LP, an alternative investments advisor.
Kayne Anderson Rudnick’s investment management operations will remain unchanged, and existing management will continue to be responsible for day-to-day management of the firm.
Certain key portfolio and executive management team members, including Chief Executive Officer Richard Kayne and Chief Investment Officer Allan Rudnick, have signed long-term employment contracts with the firm.
Upon completion of this transaction and the acquisition of Capital West Asset Management, which was announced on Oct. 15, Phoenix Investment Partners will have 11 investment affiliates, with seven participating in sponsored managed account programs.
Each affiliate operates independently in the management of assets. Phoenix provides centralized support to the affiliates in the form of distribution, marketing, product development, compliance and operations.
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