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Resolute Investment Managers agrees on recapitalization transaction with debtholders
Chicago, July 17 – Resolute Investment Managers Inc. entered into a definitive agreement with all of its lender groups, including first-lien and second-lien debtholders, and its equity sponsors for a recapitalization transaction that will address upcoming debt maturity and strengthen the company’s capital structure, according to a news release.
First-lien lender have agreed to exchange existing debt for new debt and equity.
Second-lien debtholders will receive new equity in exchange for their existing debt.
The company’s revolving credit facility will be extended through 2027.
The company intends to complete the transaction by year-end 2023, subject to the satisfaction of customary closing conditions including the consent of investment advisory and investment company clients of Resolute and its affiliates.
No changes to the day-to-day management, operations, or personnel of Resolute and its affiliates are anticipated.
S&P Global Ratings cut the company’s debt ratings in May.
At the time, the ratings agency noted that “Resolute's earnings declined in 2022, largely due to decreases in assets under management (AUM) and lower distribution revenue. As of Dec. 31, 2022, AUM was around $74 billion, down $15 billion (16%) from year-end 2021. The steep decline in Resolute's AUM, combined with lower ARK distribution fees, led the company's net revenue to fall about $61 million (26%) in 2022.”
Resolute Investment, a Kelso & Co. portfolio company, is an Irving, Tex.-based diversified asset management platform that partners with investment managers on both an affiliated and unaffiliated basis.
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