GLG Partners LP, one of the largest hedge funds in Europe, plans to list on the NYSE through a reverse acquisition transaction with Freedom Acquisition Holdings, a special-purpose acquisition company listed on the American Stock Exchange. The transaction, which is expected to close in Q4, involves two steps: (1) a 28% acquisition, valued at approx. $1.08b, of GLG by Freedom and (2) a new listing of the combined entity, 72% owned by GLG's shareholders, on the NYSE under the symbol GLG. It is expected to have a market cap of $3.4 billion. GLG began in 1995 as a division of Lehman Brothers run by three former Goldman wealth managers. It became independent in 2000, but Lehman still holds a 15.3% stake. Three GLG managing directors will own a combined 45% of the new entity. GLG manages around $20b in assets, which have grown at a compounded annual rate of 45% since 1996, with average returns of 17%, according to sources. It had a profit of $360m, on sales of $621m in '06.
Sources: Bloomberg, New York Times, Wall Street Journal
Commentary: Blackstone's Debut Leaves Some Disappointed • Blackstone IPO May Signal Private Equity Top - Barron's • Lehman Brothers: A Risk-Averse Goldman Sachs - Barron's
Stocks/ETFs to watch: Freedom Acquisition Holdings Inc. (FRH), Lehman Brothers Holdings Inc. (LEH). Competitors: Fortress Investment Group LLC (NYSE:FIG), Blackstone Group LP (NYSE:BX)
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