In other news, Fidelity joins the FINOS buy-side bandwagon, the DTCC names a new chairman & HKEX has a new link to Mainland China.
TPG-Angelo Gordon’s Combined AUM Is $208 Billion
Private equity asset manager TPG Inc. is acquiring Angelo Gordon, a $73 billion credit and real estate investment firm via a cash and equity transaction valued at approximately $2.7 billion, officials say.
Acquiring Angelo Gordon “marks a significant expansion into credit investing for TPG, establishing additional levers to drive organic growth and further expanding the breadth, diversification, and reach of the TPG platform,” according to TPG.
The price tag is “based on TPG Inc.’s share price as of May 12, 2023, including an estimated $970 million in cash and up to 62.5 million common units of the TPG Operating Group and restricted stock units of TPG, in each case, subject to certain adjustments,” according to TPG officials. “The transaction also includes an earnout based on Angelo Gordon’s future financial performance, valued at up to $400 million.”
An alternative investment manager, Angelo Gordon officials say the firm is “a fully integrated and scaled multi-strategy platform with more than 650 employees across 12 offices in the U.S., Europe, and Asia.”
The firm’s $55 billion credit platform has “scaled and diversified capabilities across the credit investing spectrum, including corporate credit, direct lending, and structured credit,” officials say.
The Angelo Gordon $18 billion real estate platform oversees “dedicated value-add real estate strategies with significant reach in the U.S., Europe, and Asia, as well as a net lease strategy. Similar to TPG, Angelo Gordon has delivered significant and sustained momentum and growth, doubling its AUM over the past five years,” officials say.
The combined assets under management (AUM) for TPG and Angelo Gordon is $208 billion as of Dec 31, 2022, officials say.
“The transaction will enable TPG and Angelo Gordon to be an even stronger partner to LPs, providing investment opportunities across a broader range of asset classes and return profiles,” according to TPG.
The transaction “was unanimously approved by the TPG board of directors,” and will likely close during the fourth quarter of this year, officials say.
Fidelity Is the Latest Buy-Side Firm to Join FINOS
Fidelity Investments reports that it is the latest buy-side firm to join the Fintech Open Source Foundation (FINOS), the financial services umbrella of the Linux Foundation.
“The value for buy-side firms in participating in industry-wide, open collaboration stems not only from infrastructure mutualization and a connected cloud journey, but also from core open source standards like FDC3 and the Common Domain Model (CDM) that drive cross-industry interoperability,” according to FINOS.
“Open source software development and a culture of continuous learning are key pillars in enabling the delivery of secure, stable, and scalable solutions in a rapidly changing environment,” says Joe Frazier, head of cloud and platform engineering at Fidelity Investments, in a prepared statement.
FINOS officials add that the organization has been steadily adding asset managers, hedge funds, and other buy-side firms such as Wellington Management and Point72. “Fidelity’s membership represents a continued recognition of the value in open source standards, projects, and initiatives for the entire financial services ecosystem,” according to FINOS.
“We have seen a significant draw in interest from buy-side firms in the last year on projects such as FDC3, which has subsequently led to further engagement from the sell-side to collaborate through open source,” says Gabriele Columbro, executive director of FINOS and general manager of the Linux Foundation Europe, in a prepared statement.
DTCC Names New Non-Executive Board Chairman
Robert Druskin
The Depository Trust & Clearing Corp. (DTCC) reports that Robert Druskin will be retiring and, after 12 years of service, stepping down from his post as non-executive chairman of the board for the post-trade market infrastructure provider.
Druskin, who is also chairman of the Board Executive Committee, served as executive chairman at the DTCC from April 2011 to December 31, 2015, officials say.
Among his industry leadership roles, Druskin was lead director of E*Trade from May through December 2009, interim CEO from December 2009 to March 2010, and chairman of the board at E*Trade from December 2009 to March 2011, according to the DTCC.
Druskin “spent nearly 16 years at Citigroup and its predecessor companies in a number of senior executive positions across the organization, including chief operating officer and member of the office of the chairman, chief operations and technology officer, and CEO of the Global Corporate and Investment Banking Division,” according to the DTCC.
Druskin will be replaced by Kevin M. Kessinger, a DTCC board member who has been appointed non-executive chairman of the DTCC Board of Directors and chairman of the Board Executive Committee, officials say.
These changes at the chairmanship level will take effect Jan. 1, 2024.
A member of DTCC’s board since 2021, Kessinger has served as chair of the businesses, technology and operations committee since 2022, officials say.
Kessinger is a former advisory board member of Tricentis and has served in that same capacity with Fenergo, Ondot, and Sutter Hill Ventures, officials say. He was also on the board of directors for Scottrade Financial Services and a senior advisor for The Boston Consulting Company.
Kevin Kessinger
Previously, Kessinger “spent five years as chief information officer and head, corporate shared services, for TD Bank in Canada. He was with Citigroup for 13 years where he was on the management committee. During his tenure at Citigroup, his positions included head, global operations and technology, president and CEO of Citi’s Consumer Finance, North America and chief operating officer of CitiCards, North America,” according to DTCC officials.
DTCC officials also announced that William Hirshorn has been elected as a new DTCC board member, effective immediately. Hirshorn is a managing director at Morgan Stanley and the global head of shared services and banking operations as well as the regional head of Americas branch operations, officials say.
The DTCC board has also announced that Claudine Gallagher has retired from the board effective March 30, 2023, “having met her five-year term limit,” officials say. “Gary Stern, chair of the risk and governance committees and member of the executive and audit committees, will step down from the board at the end of 2023 after serving for 13 years.”
The DTCC recently reported that it reached its 50th year in serving global financial markets via “products and services that mitigate risk and increase efficiencies.”
HKEX & Mainland China Launch ‘Swap Connect’
Hong Kong Exchanges and Clearing Ltd. (HKEX) reports that it has launched Swap Connect, described as “a mutual access program between Hong Kong and Mainland China’s interbank interest rate swap markets,” according to HKEX.
In fact, HKEX officials say the new link has been “warmly welcomed by regional and international investors,” and celebrations featuring HKEX and Mainland China executives were held at HKEX Connect Hall and in Beijing.
“HKEX, through its clearing subsidiary OTC Clear, has been working with China Foreign Exchange Trade System (CFETS) and Shanghai Clearing House (SHCH) to support the trading and clearing of Swap Connect, which is launching initially with a Northbound channel,” HKEX officials say.
On the first day of the Swap Connect launch, “27 offshore investors traded onshore Renmenbi (RMB) interest rate swaps with a notional value exceeding RMB8,259 million,” according to HKEX.
HKEX officials add that the launch of Bond Connect in 2017 was “part of the broader Connect program,” and an important milestone.
“This marked the beginning of even closer cooperation between Mainland China and Hong Kong’s fixed-income markets. Since that time, international investors’ onshore bond holdings have grown steadily from RMB0.8 trillion in June 2017 to RMB3.4 trillion in December 2022. Swap Connect is the next step in the evolution of this transformative program of connectivity,” according to HKEX.
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