(Bloomberg) — Todd Boehly is planning to launch a new asset management firm and is in talks to sell a stake to investors in an effort to turbocharge growth and finance potential acquisitions across the globe.
The new business, to be called Eldridge, is set to combine at least six existing platforms backed by Boehly's Eldridge Industries with its crown jewel insurer Security Benefit, according to people familiar with the matter, who asked not to be identified. discussing confidential information.
The new firm will launch with at least $65 billion in assets, likely in the next six to 12 months pending regulatory approval, the people said. Boehly is meanwhile working with advisers to solicit interest from global investors, including sovereign wealth funds, pensions and family offices in a minority stake in Eldridge that could value the asset manager at between $10 billion and $15 billion, they said.
Proceeds from any stock sale will be used to strengthen Eldridge's position as a powerhouse focused on credit and insurance. Boehly aims to take advantage as the industry consolidates, targeting firms with $3 billion to $50 billion in assets in the U.S. and Europe, the people said. Beyond that, Eldridge is considering all options, including eventually going public or pursuing a sale himself.
A spokesman for Eldridge Industries declined to comment.
It's the next act for Boehly, the investor known for helping Guggenheim Partners create an asset management unit that now oversees about 234 billion dollars. He is known for acquiring complex credit businesses and pioneering purchases of insurance assets in the wake of the 2008 financial crisis.
Boehly, who is likely to lead the new venture in the interim, has a net worth of $7.2 billion, according to the Bloomberg Billionaires Index. He has ownership stakes in Premier League's Chelsea FC and Major League Baseball's Los Angeles Dodgers.
He is looking to expand his empire as insurance holdings fuel the alternative asset management industry, with Apollo Global Management Inc. and KKR & Co. which own Athene and Global Atlantic respectively.
Boehly bought Security Benefit on behalf of Guggenheim in 2010. Eldridge Industries, his holding company, now wholly owns the insurer, which is one of the top 10 sellers of indexed annuities in the US. It has expanded in recent years through acquisitions, and the insurer will be a major investor in lending opportunities created through Eldridge's asset management arm, the people said.
Meanwhile, Boehly has actively sought to strengthen Eldridge Industries' asset management capabilities. The firm was among the final bidders for private European credit firm Hayfin, which has about 30 billion euros ($32 billion) under management. He has brought in former Investcorp GP equity-focused partner David Lee, who is set to provide capital to alternative asset managers, and has separately formed a private credit partnership with Raymond James.
The new firm will bring together asset managers including real estate investment firm Cain International, private credit firm Maranon Capital, Panagram, which specializes in collateralized loan obligations and other structured products, and Stonebriar Commercial Finance, which focuses on financing such as equipment leasing. A newer real estate venture, Eldridge Acre Partners, can also be added.
The plan is still fluid and what is included in the new firm could still change, the people said.
Eldridge Industries – owned by Boehly, Hansjörg Wyss, Tony Minella and other senior managers – will have approximately 85% of the shares in the new firm, which will be diluted if a sale of the minority shares takes place. The remainder is owned by investors including the management teams of the platform companies, as well as individuals such as Mark Walter of the Guggenheim and Richard Merkin of the Heritage Group.
Asset managers have increasingly focused on scale, in part because investors have sought to consolidate the number of firms they allocate to. BlackRock Inc. at the beginning of this year agreed to acquire Global Infrastructure Partners, while Ares Management Corp. is in talks about a possible merger with GLP Capital Partners' operations outside of China, a deal that would add about $66 billion in assets under management, Bloomberg News reported Thursday.
Eldridge Industries will retain its venture, growth capital and private equity bets, as well as many of the firm's efforts in entertainment, the people said. Those have included stakes in DraftKings, Epic Games, Payactiv and A24.