Ayalas raising stake in investment firm

MANILA, Philippines—The Ayalas have agreed to give up a 50-percent stake in Hong Kong-based real-estate investment management group ARCH Capital in exchange for a bigger interest in the investment firm The Rohatyn Group (TRG).

This was disclosed to the Philippine Stock Exchange Tuesday by Ayala Corp. and its property unit, Ayala Land Inc.

TRG is an emerging markets-focused private investment company with $3 billion worth of assets under management.

With the exchange, Ayala Corp., a cornerstone investor in TRG since its founding in 2003, will increase its investment in TRG “to become one of its largest outside shareholder,” the conglomerate said.

Ayala, however, did not say how much direct stake it would have in TRG.

TRG is expected to become the controlling stockholder of ARCH Capital after acquiring the Ayalas’ 50-percent direct stake.

The Ayalas’ stake in ARCH Capital group was worth about $32 million as of January.

The Ayalas, thus, gave up in favor of TRG its shares in ARCH Capital Management Co., Ltd. and ARCH Capital Asian Partners G.P.

ARCH Capital Management is a Hong Kong SFC-licensed asset management company. ARCH Capital Asian Partners is a Cayman Islands-registered company. They are the investment manager and general partner, respectively, of ARCH Capital Asian Partners L.P., a $330-million Asia real-estate fund with projects in China, Macau, Singapore, Thailand and India.

“We believe this is a natural progression for ARCH which has been a fruitful and exciting investment for us. At this stage, in its next growth cycle, we feel it would be better served and managed within a globally dedicated alternative asset management firm,” Ayala chief executive officer Jaime Augusto Zobel de Ayala said.

“Given Ayala’s successful experience as an investor in TRG for a significant period of time, we believe TRG will be an ideal partner in ensuring ARCH’s continued success. It will also allow us to consolidate our investments in this particular industry grouping,” Zobel de Ayala said.

For the Ayala group, the deal gives it a broader exposure in TRG, which plans to grow its business in Asia. TRG has presence in New York, Singapore, Hong Kong, London, Buenos Aires, Lima, Montevideo and Johannesburg.