Corporate Opportunities

Overview

Our flagship funds pursue investments in growth-oriented franchise businesses in North America and Europe. Our senior investment professional average over 21 years of experience investing in, advising, underwriting and restructuring leveraged companies.

We seek to invest in companies with strong existing management teams where our capital can accelerate and maximize growth over the lifecycle of the investment. We seek to partner with management teams to identify, monitor and execute upon key operational and strategic initiatives. We add value to our management partnerships by:

  • Capitalizing the company for growth at entry
  • Utilizing our network to enhance resources available to fully exploit a company’s potential
  • Leveraging our experience in capital markets activities
  • Implementing best practices
  • Assisting with strategic value-add initiatives, such as acquisitions 
Overview

 

Corporate Opportunity Funds


We target high quality, growth-oriented, franchise companies through four principal transaction types: (i) prudently leveraged control buyouts; (ii) growth equity; (iii) rescue capital; and (iv) distressed-for-control.

Our flexible capital approach enables us to quickly adapt to changing market environments and continue sourcing and executing on a broad funnel of deal flow irrespective of conditions. We pursue a relative value investment philosophy focused on identifying opportunities that maximize risk-adjusted return potential, as opposed to limiting opportunities to a specific industry, transaction type or structure. We believe that this strategy is highly differentiated amongst our peers and widens our universe of potential investment opportunities beyond that of many other buyout firms.

We manage five flagship funds focused primarily on North America and Europe:

Ares Corporate Opportunities Fund, L.P. (2003);

Ares Corporate Opportunities Fund II, L.P. (2006);

Ares Corporate Opportunities Fund III, L.P. (2008);

Ares Corporate Opportunities Fund IV, L.P. (2012); and

Ares Corporate Opportunities Fund V, L.P. (2017).

Targeted Investments

Targeted Investments

We seek compelling investments in leading companies that typically have not maximized their growth potential. We invest our capital in a variety of structures, depending on the needs of a company or a particular transaction. We are equally comfortable investing in both majority and shared-control situations and our Private Equity Group has developed extensive expertise in working through the issues that can surround shared-control investing. As a result, this flexibility helps us to develop a creative transaction that meets the needs of a company's various stakeholders.

 

Targeted Investment Characteristics

  • Differentiated or disruptive business model
  • Experienced leadership characterized by strong processes and culture
  • Defensible market position
  • Ability to capitalize on positive secular tailwinds
  • Strong customer base
  • Multiple levers for growth
Targeted Investment Characteristics
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Value Proposition

For Management Teams

We work with our portfolio company management teams to employ a four-stage value creation process, typically over a five to seven-year investment horizon. By properly capitalizing a company at the time of our investment, management can refocus its efforts toward achieving EBITDA growth and maximizing free cash flow. The chart below illustrates the prototypical actions and objectives of this process, which are generally customized for any given particular situation.

For Management Teams

Corporate Opportunities Action Plan


Stage 1
Stage 1

Capitalize Balance Sheet for Growth

Inject equity capital

Facilitate balance sheet restructuring if required

Reduce near-term debt maturities and increase liquidity

Stage 2
Stage 2

Focus on Operational Excellence

Augment management team as appropriate

Formalize process improvement practices

Develop long-term strategic plan in order to maximize value of business model

Stage 3
Stage 3

Execute on Growth Strategy

Invest in growth capital projects to enhance capabilities

Opportunistically pursue acquisitions

Inject additional equity to meet growth objectives

Stage 4
Stage 4

Position Company for Exit

Integrate acquisitions and realize synergies

Develop investment thesis for next owner

Actively explore exit alternatives


Measurable Objective


Enhance Liquidity to Pursue Growth

Expand EBITDA Margins

Grow Top Line Revenues

Maximize Free Cash Flow

For Investors
For Investors

The combination of our flexible capital approach with the broad resources of Ares Management widens our universe of potential investment opportunities and allows us to deploy capital across various market environments while remaining highly selective. Many of these situations originate from proprietary channels and require us to generate creative and complex structuring solutions.

Portfolio of Investments

While open to pursuing investments in a range of industries, we specifically target market-leading businesses that demonstrate attractive long-term growth prospects. We aim to balance our portfolios with a diverse mix of industries and types of securities. The table below lists our current platform equity investments.

 

Current Portfolio of Equity Investments1
Initial InvestmentIndustryHeadquarters LocationDescription
2014EnergyTXIndependent oil and gas exploration and development company
2018EnergyCAIndependent oil and gas exploration and development company
2012Healthcare ServicesUTHealthcare staffing services
2017EnergyTXIndependent oil and gas exploration and development company