Private Equity Firm Ares Management's IPO Comes Up Short

Banking, finance, and taxes

Published: May 2, 2014 10:20 am

Last Updated: April 28, 2020 3:46 am

Ares Management L.P. (NYSE: ARES) sold 11.2 million shares Friday morning at an IPO price of $19 a share, well below both the planned offer of 18.2 million shares and the expected price range of $21 to $23.

The Abu Dhabi Investment Authority had originally planned to sell 6.8 million shares at the initial public offering, but chose instead to retain its entire stake. At the IPO price the firm is valued at about $4 billion.

Ares got its start with junk bonds and leveraged loans, but it has now begun lending to smaller companies as well as buying companies and financing takeovers. The firm has $74 billion in assets under management and employs about 700 people in more than 15 offices in the United States, Europe and Asia.

The private equity firm appears to have run into a lack of enthusiasm for the sector. Adding to that is the recent lack of interest in IPOs in general. Recent offerings have fared less well than those launched in the first three months of the year. Numbers have dwindled in the past few weeks, although they might be reversing again. The calendar for next week currently lists nine companies planning IPOs.

Shares of Ares opened Friday morning at $18.30 and traded down about 4.2% to $18.24 in the first 30 minutes of the session.

ALSO READ: The 10 Best Cities to Flip a Home

Take Charge of Your Retirement In Just A Few Minutes (Sponsor)

Retirement planning doesn’t have to feel overwhelming. The key is finding expert guidance—and SmartAsset’s simple quiz makes it easier than ever for you to connect with a vetted financial advisor.

Here’s how it works:

Answer a Few Simple Questions. Tell us a bit about your goals and preferences—it only takes a few minutes!
Get Matched with Vetted Advisors Our smart tool matches you with up to three pre-screened, vetted advisors who serve your area and are held to a fiduciary standard to act in your best interests. Click here to begin
Choose Your Fit Review their profiles, schedule an introductory call (or meet in person), and select the advisor who feel is right for you.

Why wait? Start building the retirement you’ve always dreamed of. Click here to get started today!