RS Investments on the block, five firms in the running

RS Investments on the block, five firms in the running
Money managers DoubleLine Capital, Victory Capital Management, Virtus Investment Partners, Ridgeworth Investments and private equity firm Lovell Minnick Partners slated to place bids Friday.
AUG 20, 2015
Five firms are vying to buy San Francisco-based money manager RS Investments, and a deal is expected to be reached within two weeks, said a source familiar with sale negotiations. The firms — money managers DoubleLine Capital, Victory Capital Management, Virtus Investment Partners, Ridgeworth Investments and private equity firm Lovell Minnick Partners — were all selected as finalists and are scheduled to place bids Friday. (More: The best- and worst-performing equity mutual funds) If the bids are close in terms of price, then another round of bids would likely be solicited from the top two or three highest bidders in Friday's proceedings, the source said. That additional bidding round would take place within the next two weeks, the source said. One of the bidders, Jeffrey Gundlach's DoubleLine Capital, is considered a strategic buyer and would likely integrate RS Investments into its overall operations, the source said. He said the other four bidders would likely continue operating RS as a separate firm. RS Investments is about 80% owned by New York-based Guardian Life Insurance Co. of America. The remaining 20% of the equity-focused investment firm, which has $20 billion in assets under management, is employee owned. (More: Raymond James bolsters indexed annuities and life wholesaling with acquisition) Los Angeles-based DoubleLine has only one equity team, and the RS acquisition could beef up its efforts to build that capability The source said Guardian Life decided to sell RS Investments several months ago and use the new capital from the purchase to expand its group insurance business. Randy Diamond is a reporter at sister publication Pensions & Investments.

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