Man Group has agreed to acquire rival hedge fund manager GLG Partners, Inc. in a $1.6 billion cash and stock deal.
Man Group plc (“Man”) (UK: EMG.L) has agreed to pay $1.6 billion in cash and stock to acquire hedge fund manager GLG Partners, Inc. (“GLG”) (NYSE: GLG). The combined firm will have approximately $63 billion in assets under management upon completion of the transaction.
Under the deal terms, there will be a cash merger under a merger agreement and a share exchange under an agreement entered into with GLG’s principals. Pursuant to the terms of the merger agreement, Man will purchase the outstanding common stock of GLG not subject to the share exchange agreement for $4.50 per share, which represents a 55% premium over GLG’s closing price on May 14, 2010. The merger agreement will also require GLG to make a cash offer to purchase all outstanding warrants for $0.129 per warrant, the May 14, 2010 closing price for the warrants on the NYSE. Under the terms of the share exchange agreement, Man will acquire all of the common stock of GLG held by GLG’s three principals, together with their affiliates, in exchange for Man ordinary shares at an exchange ratio of 1.0856 Man shares per GLG share, representing a value of $3.50 per GLG share based on the May 14, 2010 closing prices of the companies. The share exchange is subject to a cap on the value of Man shares to be received of $4.25 per GLG share.
The deal is subject to customary closing conditions and is expected to close by the end of September 2010, at which time GLG will become a wholly owned subsidiary of Man Group.