AGF Management, a Canadian asset management firm, has taken a strategic leap into the realm of alternative investments with a significant investment in New Holland Capital (NHC), a New York-based multi-strategy investment manager.
With over $5bn in assets under management and more than 17 years of expertise in providing institutional investors with absolute return investment strategies across various liquidity levels, NHC stands as a robust player in the financial landscape.
The move underscores AGF’s commitment to expanding its diversified alternatives business, AGF Capital Partners, which boasts capabilities across private assets and alternative strategies.
Under the terms of the arrangement, AGF will initiate a strategic investment through a convertible note, entitling it to a 24.99% economic interest in NHC, with the option to bolster its ownership stake in the future.
AGF Capital Partners head Ash Lawrence said: “We look forward to partnering with New Holland as we continue to build and grow our alternatives business.
“The addition of New Holland and its expertise in absolute return-focused investments diversifies AGF Capital Partners’ alternatives capabilities and avenues for growth.”
NHC’s flagship Tactical Alpha multi-PM investment strategy is a testament to its prowess in navigating liquid markets, focusing on alpha-generating opportunities across fundamental and quantitative strategies while emphasising capital preservation.
Moreover, NHC manages a Special Opportunities strategy that delves into non-correlated niche credit opportunities, including specialty finance and real assets infrastructure, catering to institutional investors’ customised absolute return investment needs.
New Holland Capital CEO Scott Radke said: “We believe that AGF Capital Partners is the ideal partner to accelerate our long-term growth.
“With the support of their strong platform and broad distribution channels, we can continue to deliver attractive risk-adjusted returns to our clients to help meet their unique portfolio objectives and execute on our strategic business plan. This investment is an exciting and important step forward for our business and clients in the evolution of New Holland.”
Despite the investment, NHC will maintain its operational independence, with its existing leadership team, spearheaded by CEO Scott Radke and a cadre of nine partners, continuing to oversee day-to-day investment and business operations. AGF’s involvement will provide strategic support to NHC, facilitating joint global distribution efforts and granting access to AGF’s quantitative investing and data analytics expertise.
The growth of AGF’s alternatives business not only expands its investment horizons but also augments management and performance fee revenues, thereby bolstering earnings growth prospects.
Massumi + Consoli acted as legal counsel to AGF in this transaction, while CBRE / Sera Global served as exclusive financial advisor and Simpson Thacher & Bartlett served as legal counsel to NHC, underscoring the complexity and significance of this strategic move in the financial landscape.