TPG to Acquire Angelo Gordon for $2.7B

Image by Bruce Emmerling via Pixabay.com

TPG is acquiring Angelo Gordon for approximately $2.7 billion in cash and equity. Upon closing, Angelo Gordon will become an investing platform of its new parent. The New York City-based company’s co-CEOs, Josh Baumgarten and Adam Schwartz, will become co-managing partners of the new investment vehicle.

San Francisco-based TPG’s board has unanimously approved the deal, which is expected to close in the fourth quarter of 2023. The purchase price is based on TPG’s share price as of May 12, including an estimated $970 million in cash and up to 62.5 million common units of the TPG Operating Group, as well as restricted stock units of TPG, the companies announced on Monday, May 15.

READ ALSO: Why Having a Workplace Strategy Is a Must Today

The deal includes an earnout based on Angelo Gordon’s future financial performance, valued at as much as $400 million. The cash portion of the deal will be funded by TPG’s cash balance and undrawn revolver.

Combined AUM value

Angelo Gordon, which was founded in 1988, has more than 650 employees at its 12 offices across the U.S., Europe and Asia, as well as a $55 billion credit platform and an $18 billion real estate platform. The two companies’ combined AUM was $208 billion as of the end of 2022.

The deal will represent a significant expansion into credit investing for TPG, including corporate credit and special situations, direct lending and structured credit. It will also expand the buyer’s geographic reach in Europe and Asia, broadening its sourcing capabilities and adding additional strategies.

Ardea Partners, Morgan Securities LLC and Morgan Stanley advised TPG, while Weil, Gotshal & Manges acted as lead legal counsel. Goldman, Sachs & Co. and Piper Sandler were Angelo Gordon’s financial advisors, with Paul, Weiss acting as the firm’s legal advisor.