Our flagship funds pursue investments in growth-oriented franchise businesses in North America and Europe. Our senior investment professionals average over 22 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
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 market 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).
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
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.
Corporate Opportunities Action Plan
Capitalize Balance Sheet for Growth
Inject equity capital
Facilitate balance sheet restructuring if required
Reduce near-term debt maturities and increase liquidity
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
Execute on Growth Strategy
Invest in growth capital projects to enhance capabilities
Opportunistically pursue acquisitions
Inject additional equity to meet growth objectives
Position Company for Exit
Integrate acquisitions and realize synergies
Develop investment thesis for next owner
Actively explore exit alternatives
Enhance Liquidity to Pursue Growth
Expand EBITDA Margins
Grow Top Line Revenues
Maximize Free Cash Flow
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.
|Company Name||Initial Investment||Industry||Headquarters Location||Description|
|2019||Restaurants||IL||Experiential restaurant concept and wine club|
|2017||Energy||TX||Provider of development capital to upstream oil and gas operators|
|2017||Healthcare Services||IL||Independent multi-specialty physician group|
|2017||Energy||TX||Long-haul midstream logistics company|
|2020||Healthcare Services||United Kingdom||A leading provider of full-time, specialist-nursing mental healthcare care for adults with high acuity needs|
|2014||Consumer Products||United Kingdom||Manufacturer and retailer of premium paints and wallpaper|
|2020||Energy||TX||Midstream company focused on developing and operating oil gathering and blending infrastructure assets|
|2010||Retail||CA||Leading retailer of music products in the United States|
|2014||Building Products||United Kingdom||Greater London focused residential homebuilder|
|2013||Retail||Germany||Global online luxury retailer|