Ares Management could be called the god of investment warfare. The firm's investment activity is split into three platforms: private equity; private debt; and capital markets. Subsidiary Ares Capital (which represents the private debt platform) specializes in senior debt loans, mezzanine debt, and noncontrol equity. Ares Management invests in a variety of industries with deals typically ranging between $25 million and $75 million. Portfolio companies include Simmons Bedding, Orchard Supply Hardware, and WCA Waste. Ares Management was founded in 1997 by several executives affiliated with Apollo Global Management. The private equity firm has more than $50 billion of committed capital under management.
Ares' private equity platform targets leading middle market companies that need extra capital in order to grow over the long term. The firm looks for companies with diverse customer bases, strong cash flow, and experienced management. Ares private equity often often buys majority stakes in companies. Among its private equity holdings is Sotera Defense Solutions.
In the private debt sector Ares provides private debt and noncontrol equity financing for middle market companies. Its Ares Capital Corporation arm is a large business development corporation with more than 143 portfolio companies. Ares Capital Europe specializes in private debt across Europe. Also within the private debt segment is Ares Commercial Real Estate, which focuses on acquiring, managing, and financing commercial mortgage loans and other real estate finance investments.
Ares' capital markets group invests in tradable securities such as leveraged loans, high yield bonds, and distressed debt or other special situations.
Ares Management is headquartered in Los Angeles and has offices in other parts of the US, as well as in Europe and Asia.
Ares has teamed with Ontario Teachers Pension Plan to make several acquisitions over the years. The pair first came together to buy Serta in 2005. The couple then acquired the anemic operations of vitamin maker GNC for $1.65 billion in 2007. Three years later, the investors partnered up again to buy mattress maker Simmons (Serta's former rival) as a part of that company's Chapter 11 reorganization.
Ares teamed with another Canadian institutional investor when it joined forces with the Canada Pension Plan Investment Board in 2011 to acquire 99 Cents Only Stores for some $1.6 billion. The retailer's founding Gold/Schiffer Family also participated in the deal. – less