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Rating:A $111B-AUM Fund Firm Will Buy an Alt Credit Shop Not Rated 0.0 Email Routing List Email & Route  Print Print
Thursday, March 31, 2022

A $111B-AUM Fund Firm Will Buy an Alt Credit Shop

Reported by Neil Anderson, Managing Editor

A PE-backed, $110.5-billion-AUM (as of December 31) fund firm is preparing to buy an employee-owned, $18.7-billion AUM (also as of December 31) institutional fixed asset manager that specializes in alternative credit and has more than 100 employees worldwide (including 47 investment professionals)

Mehdi Asif Mahmud
First Eagle Investment Management, LLC
President, CEO
Yesterday, Mehdi Mahmud, president and CEO of New York City-based First Eagle Investments [profile], confirmed that First Eagle has agreed to buy Napier Park Global Capital. The plan is for Napier Park (which has offices in New York, London, and Switzerland) to become an autonomous, wholly owned First Eagle unit, to be known as "Napier Park, a First Eagle Investments Company," with CEO Jim O'Brien and chief investment officer Jon Dorfman staying on to run the firm as managing principals, reporting to Mahmud.

The deal, pricing and terms of which have not been publicly disclosed, has already been approved by First Eagle's board and by Napier Park's partners, so it's expected to close in the coming months. UBS Investment Bank advised First Eagle on the deal, while Houlihan Lokey advised Napier Park. On the legal side, Goodwin Procter counseled First Eagle and Davis Polk counseled Napier Park.

According to the First Eagle team, the plan is to keep Napier Park's investment philosophy, processes, and team intact after the deal, with Napier Park employees staying in their current roles and signing long-term deals. Mahmud frames the Napier Park deal as fitting in with First Eagle's "investment-led culture ... that encourages philosophical autonomy among ... portfolio management teams."

"Napier Park's capabilities are a strong complement to those of our existing Global Value, Small Cap and First Eagle Alternative Credit teams, and our clients will be better served by having access to all through a single platform," Mahmud states. "The transaction has no impact on First Eagle Alternative Credt, which will continue under its current leadership and operate indepently from Napier Park."

Dorfman lauds First Eagle for its "investment-centric culture and commitment to client outcomes."

"The firm's belief in maintaining Napier Park's investment and operating autonomy was extremely attractive and enabled us to reach this acquisition agreement," Dorfman states.

"We are excited to leverage First Eagle Investments' established global institutional distribution structure to amplify the momentum we've built in our business over the years," O'Brien states. "We look forward to introducing our differentiated lineup of alternative credit vehicles to a wider base of investors seeking incremental returns from credit and liquidity risk premia."

The First Eagle-Napier Park deal comes nine years after Dorfman and O'Brien spun Napier Park (then four years old) out of Citigroup. The boutique's namesake is John Napier, a 16th century Scottish astronomer, mathematician, and physicist known for inventing logarithms. 

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