Blackstone Buys Minority Stake in Marathon Asset Management

Jun 22 2016 | 9:08pm ET

A unit of Blackstone Group has bought a stake in $12.75 billion event-driven hedge fund manager Marathon Asset Management.

The investment will help Marathon further grow and institutionalize its firm while still maintaining full autonomy, the company said in a statement. Additionally, as part of the announcement, long-time Marathon partner and COO Andrew Rabinowitz has been elevated to president.

The transaction was made through the Blackstone Strategic Capital Holdings Fund, a vehicle managed by Blackstone’s Alternative Asset Management unit. Marathon pursues credit-based opportunities through a broad spectrum of investments in global corporate debt, distressed and special situational credit, structured credit, emerging markets and leveraged loans. 

"We are delighted with Blackstone’s commitment to Marathon as we continue to build our franchise and serve our clients,” said Bruce Richards, co-founder and CEO in a statement. “Aligning with the preeminent alternative manager in the world positions us well for the future as we continue to capitalize on opportunities and expand our business." 

Terms of the transaction, which was reportedly finalized this week, were not disclosed. Marathon will retain autonomy over its business management, operations and investment processes, and will continue to be led by the existing management team, the statement said. 

The Marathon stake is fourth hedge fund deal for Blackstone, which raised $3 billion in private equity funds in 2013 to acquire minority stakes in alternative asset managers. It previously bought ownership positions from Solus Alternative Asset Management, Senator Investment Group and Magnetar Capital. 

Founded in 1998 by Richards and Louis Hanover, New York-based Marathon Asset Management has approximately $12.75 billion of capital under management. Blackstone, meanwhile, is one of the world’s largest asset management companies, with $344 billion in AUM deployed across a wide range of global private equity, real estate, public debt and equity, non-investment grade credit, real assets and secondary funds.

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