The real estate arm of Kayne Anderson is set to be sold in a deal that values the investment platform at well more than $1 billion.
Bridgepoint Group announced the acquisition of Kayne Anderson Real Estate on Monday morning. The deal grants KARE an enterprise value of nearly $1.4 billion.
As part of the acquisition, Kayne Anderson shareholders will receive 189 million in newly issued shares of Bridgepoint. They will also receive $759 million in cash.
Bridgepoint expects the acquisition will boost the company’s earnings per share by somewhere in the mid-single-digit percentage range next year and by more than 20 percent the following year. The deal is expected to close by the end of the year.
For Bridgepoint, the acquisition represents one of the private equity firm’s biggest moves into the United States yet.
“This marks another major step forward in our strategy to strengthen our position as a leading global middle-market private markets platform,” Bridgepoint CEO Raoul Hughes said in a statement.
Al Rabil, who co-founded and leads KARE, will continue to run the business under the Kayne Bridgepoint brand.
“We are in the beginning of a super cycle for the alternative real estate sectors on which we focus, and joining together with Bridgepoint provides additional global resources to capitalize on this opportunity and support our continued growth,” Rabil said.
Last month, KARE revealed that it raised $5.12 billion for its opportunistic real estate fund, which significantly exceeded its $3 billion target and an initial $4 billion fundraising cap. The firm plans to deploy the capital in student housing, health care and industrial properties, particularly last-mile warehouses.
KARE counts roughly $22 billion in assets under management, split between real estate equity and debt. Upon the deal closing, the combined platform is expected to boast approximately $117 billion in assets under management.
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