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Rating:Management Will Take a $45B-AUM Firm Private Not Rated 0.0 Email Routing List Email & Route  Print Print
Thursday, July 28, 2022

Management Will Take a $45B-AUM Firm Private

Reported by Neil Anderson, Managing Editor

Management of a $45-billion-AUM (as of June 30), 27-year-old asset manager in New York City is preparing to take the company private.

Richard "Rich" Pzena
Pzena Investment Management, Inc.
Chairman, CEO, Co-Chief Investment Officer, Founder
On Tuesday, Rich Pzena, CEO of Pzena Investment Management, Inc. (PZN), unveiled a plan to buy the company via a new subsidiary of its operating company, Pzena Investment Management, LLC (PIM). The price of the deal is $9.60 per share in cash, and it values the company at about $795 million in total. (that translates into about 1.8 percent of Pzena's AUM).

The deal is expected to close next quarter, and the whole of Pzena's investment and management teams are expected to stay on. Ardea Partners LP and CastleOak Securities, L.P. advised the board's special committee (which was formed to evaluate and negotiate the deal, and approved it unanimously), while J.P. Morgan Securities LLC advised PIM. Wachtell, Lipton, Rosen & Katz provided legal counsel to the special committee, while Milbank LLP did so for PIM.

PZN's share price on Tuesday, prior to the deal announcement, was $6.44. That's down 40 percent year-over-year and since PZN IPOed in October 2007. The purchase price of $9.60 is a 49-percent premium over the pre-deal price on Tuesday (though it's still about an 11-percent dip from when it IPOed 15 years ago).

"We are excited to begin this new chapter for our firm," Richard Pzena states.

Richard Pzena founded his eponymous shop in 1995, and the firm now has 142 employees (as of June 30, 2022). The value investing shop serves mostly institutional clients, with $16.4 billion in SMAs (as of June 30) and $26.1 billion in subadvisory business. Yet the firm entered the mutual fund business in 2014, and they now have $2.5 billion in mutual fund AUM (as of June 30). 

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