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Oaktree Capital Management

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Not to be confused with Oak Hill Capital Partners or Oak Investment Partners.

Oaktree Capital Management, Inc.
Company typePublic
NYSE: OAK.PRA NYSE: OAK.PRB[1]
IndustryFinancial services
FoundedApril 1995; 29 years ago (1995-04)
FoundersHoward Marks, Bruce Karsh, Larry Keele, Richard Masson, Sheldon Stone[2]
Headquarters
Los Angeles, California
,
U.S.
Number of locations
26[3]
Key people
AUMUS$205 billion (as of September 30, 2024)[5]
OwnerBrookfield Asset Management
SubsidiariesInternazionale (99.6%)
Websiteoaktreecapital.com

Oaktree Capital Management, Inc. is an American global asset management firm specializing in alternative investment strategies. As of September 30, 2024, the company managed $205 billion for its clientele.

The firm was co-founded in 1995 by a group that had formerly worked together at the TCW Group starting in the 1980s. On April 12, 2012, Oaktree Capital Group, LLC became listed on the NYSE under the ticker symbol OAK.[6][7] On March 13, 2019, Canada's Brookfield Asset Management announced that it had agreed to buy 62% of Oaktree Capital Management for approximately $4.7 billion.[8][9]

Firm overview

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The firm is based in Los Angeles,[10] and has more than 1,200 employees[11] in offices in 23 cities worldwide (Los Angeles; New York City; London; Hong Kong; Stamford, Connecticut, Tokyo, Luxembourg, Paris, Frankfurt, Singapore, Seoul, Beijing; Amsterdam; Dubai; Houston, Dallas, Dublin, Shanghai, Sydney, Mumbai, Madrid, Stockholm, Zurich).[12][13] The company's co-chairman, Howard Marks, is known in the investment community for his letters to investors.[14]

Since its formation in 1995, Oaktree has become the largest distressed-debt investor in the world.[15][16] As reported in The Washington Post on June 26, 2011, Oaktree's 17 distressed-debt funds (which do not use leverage) have averaged annual gains of 19% after fees for the past 22 years.[17]

Investor base

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Oaktree's clientele includes 65 of the 100 largest U.S. pension plans, 40 state retirement plans in the United States, over 500 corporations and/or their pension funds, over 275 university, charitable and other endowments and foundations, and 16 sovereign wealth funds.[18][19][20] According to The Wall Street Journal, Oaktree has "long been considered a stable repository for pension-fund and endowment money."[21][9]

The company's distressed-debt funds are often over-subscribed, and in 2010 Oaktree turned down potential investors due to self-imposed limits on fund size.[22]

Investment funds

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Oaktree's current investment activities are divided across three asset classes: credit, equity, and real estate.[9][23]

History

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1990s

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Oaktree was founded in 1995 by a group of principals who first joined at the TCW Group in the mid-1980s[24] Within three months of its founding in 1995, "more than 30 TCW clients transferred $1.5 billion in assets to Oaktree."[25][26]

Oaktree has formed various sub-advisory relationships since 1995. In 1996, Oaktree was selected as the sub-advisor for the Vanguard Convertible Securities Fund.[27]

Since 1995, Oaktree has created what it refers to as "step-out" strategies, usually coincident with the opening of new offices around the world. Its growth in strategies has largely focused on expanding into European and Asian markets. Between 1997 and 1999, Oaktree created three new strategies: Emerging Markets Absolute Return in 1997, European High Yield Bonds in 1999, and Power Opportunities in 1999.[20]

2000s

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In 2001, Oaktree continued to introduce new "step-out" strategies, starting with Mezzanine Finance. Asia Principal Opportunities (2006) followed, along with European Principal Investments (2006), European Senior Loans (2006), U.S. Senior Loans and Value Opportunities (2007), Global High Yield Bonds (2010), Emerging Markets Equities (2011), and Real Estate Debt (2012).[27][28][20]

In 2005, the Securities And Exchange Commission ordered Oaktree to pay a fine, interest, and disgorge profits after the SEC ruled they had "sold securities short" before the five legal business days after a public offering pricing had gone public. Oaktree was required to put in place policies and procedures to prevent violations in the future.[29]

In 2008, the firm raised $11 billion for their distressed debt fund.[30][31] In 2009, Oaktree was selected by the U.S. Treasury, along with eight other managers (BlackRock, Invesco, AllianceBernstein and others)[32] to participate in the government's Public-Private Investment Program (PPIP).[33] At the time of Oaktree's inclusion in the PPIP program, The New York Times reported: "Howard S. Marks is the sort of financier who Washington hopes will help fix the nation’s tumbledown banks."[34] As of December 31, 2018, the Oaktree PPIP Fund, L.P. had a gross return of 28%.[28][35][20][9]

2010s

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In 2009, Oaktree acquired a 20% stake in DoubleLine Capital, a Los Angeles-based investment firm specializing in mortgage-backed fixed income portfolios.[36]

The firm's relationship with Vanguard was expanded in 2011 when Oaktree was selected as one of four firms to manage Vanguard's Emerging Markets Select Stock Fund. In 2010, Oaktree was named one of three advisors to the Russell Global Opportunistic Credit Fund and was selected as a manager for the Credit Suisse (Lux) I Fund in 2011.[27]

Seeking investment opportunities created by the European sovereign-debt crisis,[37][38] Oaktree started its European Principal Fund III in November 2011 with committed capital of some €3 billion.[39]

On April 12, 2012, Oaktree became a publicly traded partnership with shares listed on the NYSE.[7] The company was previously listed on GSTrUE, a private over-the-counter exchange run by Goldman Sachs[40] which officially ceased operations[41] in 2012 after Oaktree, along with Apollo Global Management (in 2011), de-listed and moved to the NYSE.[42]

According to the company's 2015 published financial results, Oaktree raised $12 billion for Oaktree Opportunities Funds X and Xb ("Opps X and Xb").[20]

In 2017, Eaton Vance launched the Oaktree Diversified Credit NextShares exchange-traded managed fund with Oaktree as subadvisor.

In 2018, Oaktree filed a registration statement to launch a non-traded REIT.[43]

On March 13, 2019, Brookfield Asset Management announced that it had agreed to buy 62% of Oaktree Capital Management for about $4.7 billion, creating one of the world's largest alternative money managers.[8][9] On September 30, 2019, completion of the acquisition of a majority stake by Brookfield Asset Management was announced.[44]

2020s

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In November 2021, Oaktree closed its largest fund, Opportunities Fund XI LP, after collecting $15.9 billion.[45] In March 2022, Oaktree acquired a majority stake in 17Capital, a private credit firm based in London.[46][47] In February 2023, the company launched a private credit fund, Oaktree Lending Partners, which finances private equity takeovers.[48][49] In June 2023, Robert O'Leary and Armen Panossian were named as the incoming co-CEOs.[50] As of August 2023, Oaktree was trying to raise over $18 billion for its 12th fund, Oaktree Opportunities Fund XII, potentially becoming the largest-ever private debt fund.[51]

In July 2024, it was announced that Lloyds Banking Group partnered with Oaktree to finance UK buyouts.[52]

Select past and current investments

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See also

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References

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  1. ^ "UNITED STATES SECURITIES AND EXCHANGE COMMISSION- Oaktree Capital Group, LLC". ir.oaktreecapital.com.
  2. ^ "Oaktree Takes Root: Junk Bond Pros Base New Firm on Old Ideas". Los Angeles Times. July 10, 1995.
  3. ^ "Oaktree: Contact Us".
  4. ^ a b c "Oaktree Capital to Appoint New Leadership at Firm". The Wall Street Journal. June 27, 2023.
  5. ^ "Oaktree: About".
  6. ^ "About Oaktree". Los Angeles: Oaktree Capital Management. Retrieved May 12, 2010. Financial figures as of March 31, 2010.
  7. ^ a b Lattman, Peter (April 12, 2012). "Private Goldman Exchange Officially Closes for Business". Business Day: DealBook.
  8. ^ a b "Brookfield to Acquire 62% of Oaktree Capital Management". NASDAQ.com. Retrieved March 14, 2019.
  9. ^ a b c d e "Document". www.sec.gov. Retrieved July 16, 2019.
  10. ^ Vincent, Roger (November 14, 2014) "Oaktree Capital agrees to expand offices in downtown Los Angeles" Los Angeles Times
  11. ^ "Oaktree Capital Management Group, LLC; Oaktree Capital Appoints Marna Whittington to Board of Directors". Investment Weekly News. July 21, 2012.
  12. ^ "Oaktree Opens Office in Helsinki, Led by Ex-PineBridge Exec Tomi Langstrom". PE Hub. April 14, 2020.
  13. ^ "Oaktree Capital- Contact Us". www.oaktreecapital.com.
  14. ^ Lattman, Peter (May 18, 2011). "Oaktree Capital, an Investment Firm, Is Said to Plan Stock Exchange Listing". The New York Times.
  15. ^ Atlas, Riva (2001). "Company in Trouble? They're Waiting". The New York Times. Retrieved December 24, 2018.
  16. ^ "Finance and Economics: The vultures take wing; Investing in distress". The Economist. March 31, 2007. Retrieved July 12, 2012.
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  20. ^ a b c d e "Oaktree Capital Group, LLC" 10-k form.
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  22. ^ Cox, Rob (May 19, 2011). "A Balancing Act at Oaktree Capital Management". The New York Times. Retrieved July 12, 2012.
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  24. ^ Rundle, Rhona (March 16, 1995). "TCW's Junk-Bond Chief, Marks, Others, to Start Their Own Firm -- Departures Are Major Blow and Could be Followed by Client Defections". The Wall Street Journal.
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  26. ^ "Oaktree Capital Management Company". International Directory of Company Histories. Reproduced in Business and Company Resource Center. Farmington Hills, Mich.:Gale Group. 2012.
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  28. ^ a b "Oaktree Capital S1". United States Securities and Exchange Commission. June 17, 2011. Retrieved January 12, 2012.
  29. ^ "Oaktree Capital Management Company, Exchange Act Release No. 51709 (May 19, 2005)" (PDF). May 19, 2005. Securities and Exchange Commission. Retrieved August 10, 2011.
  30. ^ Arnold, Martin (May 17, 2008). "Oaktree Capital raises 11bn for distressed debt fund". Financial Times. Retrieved July 12, 2012.
  31. ^ Sakoui, Anousha (October 28, 2008). "Distressed debt funds maintain tight secrecy as offerings abound". Financial Times.
  32. ^ Shieber, Jonathan (November 2011). "PPIP Brings Investors Narrow Opportunities, Nice Returns". The Private Equity Analyst.
  33. ^ Protess, Ben (January 24, 2011). "Bad Asset Purchase Program Turning a Profit; DealBook". The New York Times. Retrieved July 12, 2012.
  34. ^ Kouwe, Zachery (February 10, 2009). "Washington Hopes 'Vulture' Investors Will Buy Bad Assets". The New York Times. Retrieved July 12, 2012.
  35. ^ Paletta, Damian (July 9, 2009). "Treasury unveils a trimmed down PPIP – Nine fund managers picked for $30 billion program to buy toxic securities; Pimco backs out". The Wall Street Journal.
  36. ^ "Marks's Oaktree Seen Nearing $1 Billion Gain on Gundlach Bet". Bloomberg News. February 18, 2016. Retrieved May 23, 2018.
  37. ^ Deng, Chao. "Oaktree Capital's Marks Says Investors Should Insist on 'Low Prices' in Europe". LBO Wire. July 3, 2012.
  38. ^ Kreutzer, Laura (February 9, 2012). "Washington to Recommend $1B in Private Equity Commitments". LBO Wire.
  39. ^ Kuo, Patricia (March 6, 2012). "Oaktree Is Said to Raise $4 Billion Fund to Buy Distressed European Assets". Bloomberg. Retrieved July 12, 2012.
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  41. ^ Sender, Henry (June 18, 2011). "Oaktree Capital Management files for $8bn NYSE listing". Financial Times. Retrieved July 12, 2012.
  42. ^ Lattman, Peter (April 12, 2012). "Private Goldman Exchange Officially Closes for Business". The New York Times. Retrieved January 12, 2012.
  43. ^ "Global Investment Manager Oaktree Launches $2B Non-Traded REIT". www.bisnow.com. Retrieved May 23, 2018.
  44. ^ "Brookfield Asset Management Completes Acquisition of 61.2% of Oaktree Capital Management".
  45. ^ Cumming, Chris (November 16, 2021). "Oaktree Capital Closes Its Largest-Ever Fund". The Wall Street Journal.
  46. ^ Kozlowski, Rob (March 9, 2022). "Oaktree Capital gets majority stake in private credit firm 17Capital". Pensions & Investments.
  47. ^ Gara, Antoine (April 20, 2022). "Oaktree-backed 17Capital raises almost $3bn for first credit fund". Financial Times.
  48. ^ Platt, Eric (February 28, 2023). "Oaktree Capital moves into leveraged buyout lending with $10bn fund". Financial Times.
  49. ^ Faille, Christopher (February 28, 2023). "Oaktree launches private credit fund, targeting $10bn raise". Private Debt Investor.
  50. ^ Gottfried, Miriam (June 27, 2023). "Oaktree Capital to Appoint New Leadership at Firm". The Wall Street Journal.
  51. ^ Brown, Silas; Benitez, Laura; Hidalgo, Kat (August 10, 2023). "Oaktree Targets Record Private Debt Fund of Over $18 Billion". Bloomberg.
  52. ^ "Lloyds partners with Oaktree in £1bn push to fund buyout loans". Financial Times. Retrieved July 18, 2024.
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  54. ^ "Almatis Group Files Pre-packaged Chapter 11 Cases to Implement Agreed Financial Restructuring" (Press release). Frankfurt: Almatis Group. April 30, 2010. Retrieved May 14, 2010.
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  61. ^ "Quadrant expands wellness empire with acquisition of Fitness First Australia". Australasian Leisure Management. September 29, 2016. Retrieved May 19, 2018.
  62. ^ Tay, Vivienne (February 24, 2017). "Celebrity Fitness and Fitness First Asia set to merge". Marketing. Retrieved May 19, 2018.
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  66. ^ "MediaWorks Ownership Update". MediaWorks. April 29, 2015. Retrieved May 22, 2015.
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  68. ^ Connelly, Laylan (February 11, 2016). "Quiksilver, free from bankruptcy, talks booze and boardshorts". Retrieved June 27, 2016.
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  70. ^ "Communiqué de Oaktree et Pierre-Antoine Capton". September 7, 2020.
  71. ^ Marek, Lynne (July 23, 2012). "Tribune's bankruptcy exit could mean company breakup". Crain's Chicago Business. Retrieved November 1, 2012.
  72. ^ Nouvelle, L'Usine (April 22, 2010). "Investissement, mais coupe claire aux Verreries de l'Orne". L'Usine Nouvelle (in French). Antony, Hauts-de-Seine, France. Retrieved May 14, 2010.
  73. ^ Nic Fildes (September 27, 2020). "Oaktree invests £100m in British broadband". Financial Times. Archived from the original on December 11, 2022. Retrieved September 28, 2020.

Further reading

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