Ares Management Corporation and Vinci Partners Investments Ltd. recently announced that they have agreed to form a strategic partnership to accelerate the growth of Vinci’s platform in Latin America and collaborate on distribution, product development, and other business opportunities. In connection with forming the strategic partnership, an affiliate of Ares will concurrently make a US$100 million investment in new convertible preferred shares to be issued by Vinci, subject to customary closing conditions.
Together, Ares and Vinci plan to collaborate primarily across three strategically accretive areas:
1.) Strategic Distribution – Ares and Vinci will collaborate on fundraising to broaden each of the respective company’s limited partner relationship networks within Brazil and globally.
2.) New Product Development and Investment Collaboration – Ares and Vinci will explore launching co-branded products and investment strategies that leverage each platform’s unique capabilities. Additionally, Ares and Vinci will collaborate on new investment opportunities in Latin America that could be suitable for the companies’ respective investment strategies.
3.) Implementation of Operational and Strategy Best Practices – Ares will provide Vinci with strategic guidance on investment strategy, investor relations, business operations, pursuit of strategic initiatives and other related functions to drive continued growth of the platform.
In connection with the investment and in order to drive the success of the strategic partnership and connectivity between the platforms, a representative from Ares will be appointed to the Vinci Board of Directors. And Vinci plans to use the proceeds from the Investment for strategic initiatives, including ongoing organic growth efforts as well as potential complementary inorganic opportunities within Brazil and broader Latin America.
The consummation of the investment and the formation of the strategic partnership is subject to the satisfaction of customary closing conditions. And Vinci expects the formation of the Strategic Partnership and the issuance of the convertible preferred shares to occur in late October 2023.
KEY QUOTES:
“We are pleased to announce this strategic partnership with a leading multi-asset class investment manager in Latin America. We have known the Vinci team for over a decade and share similar business-building and investment DNA. Latin America is in the very early innings of the adoption of private market strategies, and we believe there are market forces that will accelerate the growth of these asset classes over the coming years. We are very impressed with the business that the Vinci team have built over the last decade, and we believe that through this partnership we can accelerate value for our respective firms, investors and other key stakeholders.”
– Michael Arougheti, Chief Executive Officer and President of Ares
“We are very excited to form a strategic partnership with Ares. We admire the Ares team’s remarkable history and achievements to create one of the leading alternative asset management firms globally. We are confident that the lessons learned during their journey will be extremely helpful to us in the coming years as Vinci enters a new growth cycle and as opportunities in private credit, in particular, continue to grow across Latin America. We believe this will be a win-win partnership, through which Vinci expects to open new growth avenues in Brazil and Latin America, drive incremental fundraising to Ares and benefit from Ares’ best practices, global footprint, knowledge and scale in key private markets areas.”
– Alessandro Horta, Chief Executive Officer of Vinci Partners
