Various asset supervisor Blue Owl Capital has introduced a definitive settlement to amass Kuvare Insurance coverage Providers LP (also called Kuvare Asset Administration) for $750 million.

KAM, a specialised funding administration agency, caters to the insurance coverage trade, together with Kuvare UK Holdings (Kuvare), by offering asset administration companies.

The acquisition is deliberate to be financed by a mixture of $325 million in money and $425 million in Blue Owl Class A typical inventory.

Anticipated to be accomplished within the second or third quarter of 2024, Blue Owl says that the acquisition’s closure depends on receiving normal regulatory approvals and satisfying different customary closing situations.

Upon finalizing the KAM buy, nearly all of KAM’s workers are slated to transition to Blue Owl. The deal consists of the potential for a further earnout of as much as $250 million, contingent on reaching particular future income benchmarks.

Most well-liked fairness settlement with Kuvare

Concurrently, Blue Owl has bolstered a long-term partnership with Kuvare by buying $250 million in most well-liked fairness, designed to foster a long-lasting relationship between the 2 entities, offering Kuvare’s insurance coverage corporations — which is able to now additionally function Blue Owl’s new asset administration shoppers — with progress capital.

Since its inception in 2015, Kuvare has operated a number of insurance coverage and reinsurance companies, dealing in fastened and listed annuities within the US.

Along side the popular fairness funding, Blue Owl and Kuvare have additionally formalized funding administration agreements (IMAs) permitting Blue Owl to handle as much as $3 billion of property. These funds will probably be unfold throughout Blue Owl’s credit score, GP strategic capital, and actual property funding platforms, with room for future progress.

Whereas Kuvare will proceed overseeing the asset allocations for its insurance coverage operations and strategic investments, the IMAs will bolster Blue Owl’s everlasting capital base and improve Kuvare’s funding capabilities.

Doug Ostrover, co-CEO of Blue Owl, emphasised the acquisition’s significance and welcomed the creation of Blue Owl Insurance coverage Options.

“Our acquisition of KAM permits us to offer broader options to the multi-trillion-dollar insurance coverage market at scale,” Ostrover mentioned.

Marc Lipschultz, Blue Owl’s different co-CEO, additionally highlighted the mutual advantages of the popular fairness funding in Kuvare.

“This partnership with Kuvare anchors Blue Owl’s increasing presence within the insurance coverage channel, enormously complementing our sturdy institutional and wealth footprint and additional diversifying the markets for which we offer funding options,” Lipschultz mentioned.

Lastly, Kuvare founder, chairman, and CEO Dhiren Jhaveri referred to as the collaboration an “necessary and thrilling step within the evolution” of the corporate.

“We at all times attempt to be wonderful stewards of property entrusted to us by our policyholders and reinsurance companions, and the staff at Blue Owl has demonstrated a singular dedication to serving to us obtain our targets. We particularly stay up for continued collaboration with our many valued KAM colleagues who will be a part of the Blue Owl staff on the shut of this transaction,” Jhaveri mentioned.

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