Morgan Stanley Investment Management Forms Strategic Alliance with Avenue Capital Group
Acquires Minority Stake in Firm with Approximately $12 Billion in Assets Under Management as Part of MSIM's Expansion in Alternative Investments
Oct 30 2006 | New York
Morgan Stanley Investment Management (MSIM) announced today that it has formed a strategic alliance with Avenue Capital Group, a leading New York-based investment manager with approximately $12 billion in assets under management. Under the proposed agreement, Morgan Stanley will acquire a minority interest in Avenue, and Avenue will remain an independent firm led by its current management team. Avenue will invest 100 percent of the proceeds received from this transaction into funds managed by Avenue.
"This alliance with one of the world's leading firms in the distressed securities market is another key step in our strategy to build a more robust alternative investments capability," said Owen Thomas, President and Chief Operating Officer of MSIM. "It is an attractive alliance for both firms. Avenue offers specialized expertise in a key alternative investment category, while MSIM provides Avenue with access to an extensive global presence, broad client reach and numerous new investment opportunities. As we continue to execute our strategy for building our asset management franchise, we will be exploring similar alliances that can bring industry leading investment teams and products to our clients."
Marc Lasry, Managing Partner and Founder of Avenue Capital Group, said, "We are pleased to have the sponsorship of a world-class firm like Morgan Stanley. We see a tremendous number of investment opportunities across all of our strategies and in our key markets. By aligning with Morgan Stanley, we expect to be much better positioned to take advantage of these and other exciting investment opportunities that we see around the globe."
"Our confidence in Avenue's future and the benefits of this strategic alliance with Morgan Stanley is underscored by the fact that we will invest 100 percent of the proceeds from this transaction into the Avenue funds," said Sonia Gardner, Partner and Founder of Avenue Capital Group.
Stu Bohart, Head of Alternative Investments at MSIM, said, "Our partnership with Avenue will help align our Alternative Investments effort with a best-in-class investment management firm. We look forward to building upon this partnership and exploring opportunities for even greater collaboration with Avenue in the future."
"Avenue has an outstanding track record, a differentiated strategy built upon its global expertise, particularly in distressed securities, and investment strategies that are an excellent complement to the hedge fund products currently offered by MSIM's Absolute Return Strategies Group," said Yie-Hsin Hung, Head of Strategic Acquisitions and Alliances at MSIM.
About Avenue Capital Group
Avenue Capital Group manages assets valued at approximately $12 billion as of September 30, 2006. Avenue is a leading global investment management firm specializing in distressed and undervalued credit-related securities (both public and private), bank loans, trade claims and private investments (debt and equities.) Founded in 1995, Avenue is headquartered in New York, with offices in London, Frankfurt, Luxembourg, and has eight offices throughout Asia. Avenue is led by its founders Marc Lasry and Sonia E. Gardner, who have spent virtually their entire careers in the field of distressed investments. Avenue draws on the skills and experience of more than 115 investment professionals and over 240 employees worldwide throughout its twelve offices. Avenue manages capital on behalf of publicly and privately-sponsored pension funds, institutional investors, universities, endowments, fund of funds, and family offices. For further information about Avenue Capital Group, please visit www.avenuecapital.com.
About Morgan Stanley Investment Management
Morgan Stanley Investment Management, together with its investment advisory affiliates, has over 400 investment professionals around the world and $448 billion in assets under management or supervision as of August 31, 2006. These entities offer investment management services to a diverse client base, which includes governments, institutions, corporations and individuals.
About Morgan Stanley
Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, investment management, wealth management and credit services. The Firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 600 offices in 30 countries. For further information about Morgan Stanley, please visit www.morganstanley.com.
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