Debevoise & Plimpton LLP advised Parnassus Investments on the deal.
Parnassus Investments, the largest ESG-dedicated fund manager in the U.S., executed its agreement to sell a majority equity interest to Affiliated Managers Group, Inc. (NYSE: AMG). Upon closing of the agreement, Parnassus partners will continue to own a substantial portion of the equity of the firm and direct its day-to-day operations consistent with AMG’s partnership approach, which is recognized by the marketplace for preserving the operating and investment independence of AMG Affiliates.
The terms of the transaction were not disclosed. AMG expects that the investment in Parnassus will contribute approximately $70 million to Adjusted EBITDA and $1.30 to Economic earnings per share in 2022, and the transaction will be funded with existing corporate resources. Mr. Allen and Mr. Ahlsten will enter into long-term employment agreements with the firm. The transaction, which is expected to close during the second half of 2021, is subject to customary closing conditions and regulatory approvals.
AMG is a leading partner to independent active investment management firms globally. AMG’s strategy is to generate long-term value by investing in a diverse array of excellent independent partner-owned firms, through a proven partnership approach, and allocating resources across AMG’s unique opportunity set to the areas of highest growth and return.
Founded in 1984, Parnassus Investments is a pioneer in socially responsible investing. The firm invests responsibly to build wealth for its clients by selecting businesses that the investment team believes have increasingly relevant products or services, sustainable competitive advantages and quality management teams for their high conviction portfolios.
Moelis & Company LLC acted as exclusive financial advisor to Parnassus Investments.
The Debevoise team was led by M&A partner William Regner (Picture) and included associates Vishaal Sharma, Yean Do and Daniel Randazzo, investment management partner Marc Ponchione, benefits partner Jonathan Lewis and associate David Deutsch, tax partner Peter Furci and associate Kimberly Lee, and litigation associate Roy Sengupta.
Involved fees earner: David Deutsch – Debevoise & Plimpton; Yean Do – Debevoise & Plimpton; Peter Furci – Debevoise & Plimpton; Jonathan Lewis – Debevoise & Plimpton; Marc Ponchione – Debevoise & Plimpton; Daniel Randazzo – Debevoise & Plimpton; William Regner – Debevoise & Plimpton; Roy Sengupta – Debevoise & Plimpton; Vishaal Sharma – Debevoise & Plimpton;
Law Firms: Debevoise & Plimpton;
Clients: Parnassus Investments;