Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2021 | Oct. 29, 2021 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-36429 | |
Entity Registrant Name | ARES MANAGEMENT CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 80-0962035 | |
Entity Address, Address Line One | 2000 Avenue of the Stars | |
Entity Address, Address Line Two | 12th Floor | |
Entity Address, City or Town | Los Angeles | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90067 | |
City Area Code | 310 | |
Local Phone Number | 201-4100 | |
Title of 12(b) Security | Class A common stock, par value $0.01 per share | |
Trading Symbol | ARES | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001176948 | |
Current Fiscal Year End Date | --12-31 | |
Class A Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 167,613,551 | |
Non- voting Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 3,489,911 | |
Class B Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 1,000 | |
Class C Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 118,803,257 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Financial Condition - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||||||||
Intangible assets, net | $ 798,690 | $ 222,088 | ||||||
Total assets | 19,934,398 | 15,168,992 | ||||||
Liabilities | ||||||||
Operating lease liabilities | 214,681 | |||||||
Total liabilities | 15,295,223 | 12,596,852 | ||||||
Commitments and contingencies | ||||||||
Stockholders' Equity | ||||||||
Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (zero and 12,400,000 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively) | 0 | 298,761 | ||||||
Additional paid-in-capital | 1,881,913 | 1,043,669 | ||||||
Retained earnings | (128,981) | (151,824) | ||||||
Accumulated other comprehensive income (loss), net of tax | (2,571) | 483 | ||||||
Total stockholders' equity | 1,753,260 | 1,193,685 | ||||||
Total equity | 3,540,526 | $ 3,441,115 | $ 2,420,568 | 2,471,774 | $ 2,370,881 | $ 2,003,748 | $ 1,975,596 | $ 1,858,598 |
Total liabilities, redeemable interest, non-controlling interests and equity | 19,934,398 | 15,168,992 | ||||||
Class A Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 1,676 | 1,472 | ||||||
Non- voting Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 35 | 0 | ||||||
Class B Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 0 | 0 | ||||||
Class C Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 1,188 | 1,124 | ||||||
Consolidated Funds | ||||||||
Assets | ||||||||
Cash and cash equivalents | 1,581,433 | 522,377 | ||||||
U.S. Treasury securities, at fair value | 1,000,165 | 0 | ||||||
Investments, at fair value | 10,360,854 | 10,877,097 | ||||||
Due from affiliates | 9,059 | 17,172 | ||||||
Receivable for securities sold | 187,230 | 121,225 | ||||||
Other assets | 47,806 | 35,502 | ||||||
Liabilities | ||||||||
Accounts payable, accrued expenses and other liabilities | 89,685 | 46,824 | ||||||
Due to affiliates | 0 | 0 | ||||||
Payable for securities purchased | 863,007 | 514,946 | ||||||
CLO loan obligations, at fair value | 10,174,794 | 9,958,076 | ||||||
Fund borrowings | 99,240 | 121,909 | ||||||
Redeemable interest | 1,000,000 | 916,824 | 930,924 | 0 | ||||
Non-controlling interests in Consolidated Funds | 464,400 | 539,720 | ||||||
Ares Operating Group | ||||||||
Liabilities | ||||||||
Redeemable interest | 98,649 | $ 100,031 | $ 99,808 | 100,366 | ||||
Non-controlling interests in Ares Operating Group entities | 1,322,866 | 738,369 | ||||||
Ares Management L.P | ||||||||
Assets | ||||||||
Cash and cash equivalents | 295,704 | 539,812 | ||||||
Investments (includes accrued carried interest of $2,625,319 and $1,145,853 at September 30, 2021 and December 31, 2020, respectively) | 3,322,665 | 1,682,759 | ||||||
Due from affiliates | 493,411 | 405,887 | ||||||
Other assets | 1,006,870 | 590,332 | ||||||
Intangible assets, net | 1,452,690 | 222,087 | ||||||
Right-of-use operating lease assets | 176,511 | 154,742 | ||||||
Liabilities | ||||||||
Accounts payable, accrued expenses and other liabilities | 208,141 | 115,289 | ||||||
Accrued compensation | 309,569 | 103,010 | ||||||
Due to affiliates | 202,438 | 100,186 | ||||||
Performance related compensation payable | 1,895,343 | 813,378 | ||||||
Debt obligations | 1,238,325 | 642,998 | ||||||
Operating lease liabilities | 214,681 | 180,236 | ||||||
Stockholders' Equity | ||||||||
Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (zero and 12,400,000 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively) | 0 | 298,761 | ||||||
Additional paid-in-capital | 1,881,913 | 1,043,669 | ||||||
Retained earnings | (128,981) | (151,824) | ||||||
Accumulated other comprehensive income (loss), net of tax | (2,571) | 483 | ||||||
Total stockholders' equity | 1,753,260 | 1,193,685 | ||||||
Ares Management L.P | Class A Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 1,676 | 1,472 | ||||||
Ares Management L.P | Non- voting Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 35 | |||||||
Ares Management L.P | Class B Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 0 | 0 | ||||||
Ares Management L.P | Class C Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | $ 1,188 | $ 1,124 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Financial Condition (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Preferred stock, shares issued (in shares) | 0 | 12,400,000 |
Preferred stock, shares outstanding (in shares) | 0 | 12,400,000 |
Common stock, shares outstanding (in shares) | 289,875,333 | 259,631,180 |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,500,000,000 | 1,500,000,000 |
Common stock, shares issued (in shares) | 167,581,165 | 147,182,562 |
Common stock, shares outstanding (in shares) | 167,581,165 | 147,182,562 |
Non- voting Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 3,489,911 | 0 |
Common stock, shares outstanding (in shares) | 3,489,911 | 0 |
Class B Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,000 | 1,000 |
Common stock, shares issued (in shares) | 1,000 | 1,000 |
Common stock, shares outstanding (in shares) | 1,000 | 1,000 |
Class C Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 499,999,000 | 499,999,000 |
Common stock, shares issued (in shares) | 118,803,257 | 112,447,618 |
Common stock, shares outstanding (in shares) | 118,803,257 | 112,447,618 |
Ares Management L.P | Carried interest | ||
Equity method investments: | $ 2,625,319 | $ 1,145,853 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenues | ||||
Total revenues | $ 948,719 | $ 489,866 | $ 2,901,926 | $ 1,106,033 |
Expenses | ||||
Compensation and benefits | 335,569 | 837,108 | ||
Performance related compensation | 331,141 | 1,208,954 | ||
General, administrative and other expenses | 134,453 | 285,471 | ||
Total expenses | 813,267 | 392,580 | 2,363,108 | 958,106 |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 8,334 | 18,744 | ||
Interest and dividend income | 1,376 | 6,818 | ||
Interest expense | (11,523) | (25,125) | ||
Other income, net | 36,654 | 30,686 | ||
Total other income (expense) | 111,536 | 62,355 | 218,011 | (43,602) |
Income (loss) before taxes | 246,988 | 159,641 | 756,829 | 104,325 |
Income tax expense | 30,275 | 18,314 | 104,487 | 22,119 |
Net income (loss) | 216,713 | 141,327 | 652,342 | 82,206 |
Net income attributable to Ares Management Corporation | 84,726 | 47,545 | 284,748 | 72,880 |
Less: Series A Preferred Stock dividends paid | 0 | 5,425 | 10,850 | 16,275 |
Less: Series A Preferred Stock redemption premium | 0 | 0 | 11,239 | 0 |
Net income attributable to Ares Management Corporation Class A and non-voting common stockholders | $ 84,726 | $ 42,120 | $ 262,659 | $ 56,605 |
Class A Common Stock | ||||
Net income per share of Class A and non-voting common stock: | ||||
Basic (in dollars per share) | $ 0.49 | $ 0.27 | $ 1.55 | $ 0.37 |
Diluted (in dollars per share) | $ 0.45 | $ 0.27 | $ 1.48 | $ 0.37 |
Weighted-average shares of Class A and non-voting common stock: | ||||
Basic (in shares) | 168,931,621 | 143,466,209 | 161,071,151 | 131,866,471 |
Diluted (in shares) | 186,522,157 | 158,122,563 | 177,143,438 | 131,866,471 |
Consolidated Funds | ||||
Expenses | ||||
Expenses of Consolidated Funds | $ 12,104 | $ 6,019 | $ 31,575 | $ 16,706 |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 34,245 | 17,971 | 44,720 | (153,268) |
Interest expense | (61,578) | (66,322) | (191,577) | (222,860) |
Interest and other income of Consolidated Funds | 104,028 | 116,581 | 333,745 | 346,120 |
Less: Net income (loss) attributable to non-controlling interests | 47,370 | 42,627 | 102,255 | (38,593) |
Ares Operating Group | ||||
Other income (expense) | ||||
Net income (loss) | 169,343 | 98,700 | 550,087 | 120,799 |
Less: Net income (loss) attributable to non-controlling interests | 84,293 | 52,162 | 264,646 | 48,926 |
Less: Net income (loss) attributable to redeemable interest in Ares Operating Group entities | 324 | (1,007) | 693 | (1,007) |
Ares Management L.P | ||||
Revenues | ||||
Total revenues | 948,719 | 489,866 | 2,901,926 | 1,106,033 |
Expenses | ||||
Compensation and benefits | 335,569 | 194,267 | 837,108 | 559,482 |
Performance related compensation | 331,141 | 122,356 | 1,208,954 | 191,565 |
General, administrative and other expenses | 134,453 | 69,938 | 285,471 | 190,353 |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 8,334 | (2,607) | 18,744 | (10,351) |
Interest and dividend income | 1,376 | 1,344 | 6,818 | 5,112 |
Interest expense | (11,523) | (6,815) | (25,125) | (18,203) |
Other income, net | 36,654 | 2,203 | 30,686 | 9,848 |
Management fees | ||||
Revenues | ||||
Total revenues | 448,262 | 1,135,821 | ||
Management fees | Ares Management L.P | ||||
Revenues | ||||
Total revenues | 448,262 | 292,434 | 1,135,821 | 823,150 |
Carried interest allocation | ||||
Revenues | ||||
Total revenues | 460,651 | 1,610,707 | ||
Carried interest allocation | Ares Management L.P | ||||
Revenues | ||||
Total revenues | 460,651 | 168,978 | 1,610,707 | 241,380 |
Incentive fees | ||||
Revenues | ||||
Total revenues | 696 | 19,420 | ||
Incentive fees | Ares Management L.P | ||||
Revenues | ||||
Total revenues | 696 | 7,194 | 19,420 | 4,276 |
Principal investment income | ||||
Revenues | ||||
Total revenues | 14,250 | 86,477 | ||
Principal investment income | Ares Management L.P | ||||
Revenues | ||||
Total revenues | 14,250 | 11,408 | 86,477 | 8,330 |
Administrative, transaction and other fees | ||||
Revenues | ||||
Total revenues | 24,860 | 49,501 | ||
Administrative, transaction and other fees | Ares Management L.P | ||||
Revenues | ||||
Total revenues | $ 24,860 | $ 9,852 | $ 49,501 | $ 28,897 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Net income | $ 216,713 | $ 141,327 | $ 652,342 | $ 82,206 |
Other comprehensive income: | ||||
Foreign currency translation adjustments, net of tax | (11,324) | 16,893 | (18,439) | 5,372 |
Total comprehensive income | 205,389 | 158,220 | 633,903 | 87,578 |
Ares Management L.P | ||||
Other comprehensive income: | ||||
Comprehensive income attributable to Ares Management Corporation | 81,459 | 51,995 | 281,694 | 72,140 |
Consolidated Funds | ||||
Other comprehensive income: | ||||
Less: Comprehensive income (loss) attributable to non-controlling interests | 42,015 | 50,300 | 89,784 | (32,478) |
Ares Operating Group | ||||
Net income | 169,343 | 98,700 | 550,087 | 120,799 |
Other comprehensive income: | ||||
Less: Comprehensive income (loss) attributable to non-controlling interests | 81,947 | 56,290 | 262,492 | 48,281 |
Less: Comprehensive loss attributable to redeemable interest | $ (32) | $ (365) | $ (67) | $ (365) |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Additional Paid-in-Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Non-Controlling interestAres Operating Group | Non-Controlling interestConsolidated Funds | Series A Preferred StockPreferred Stock | Class A Common StockCommon Stock | Non- voting Common StockCommon Stock | Class C Common StockCommon Stock |
Beginning balance at Dec. 31, 2019 | $ 1,858,598 | $ 525,244 | $ (50,820) | $ (6,047) | $ 472,288 | $ 618,020 | $ 298,761 | $ 1,152 | $ 0 | |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Consolidation and deconsolidation of funds, net | (3,882) | (3,882) | ||||||||
Changes in ownership interests and related tax benefits | (74,079) | (196,670) | 122,551 | 40 | ||||||
Issuances of common stock | 383,334 | 382,061 | 121 | 1,152 | ||||||
Capital contributions | 175,277 | 42,012 | 133,265 | |||||||
Dividends/Distributions | (125,755) | (51,090) | (55,748) | (13,492) | (5,425) | |||||
Net income (loss) | (275,797) | (36,461) | (78,355) | (166,406) | 5,425 | |||||
Currency translation adjustment, net of tax | (14,208) | (4,802) | (4,719) | (4,687) | ||||||
Equity compensation | 32,557 | 16,420 | 16,137 | |||||||
Stock option exercises | 19,551 | 19,540 | 11 | |||||||
Ending balance at Mar. 31, 2020 | 1,975,596 | 746,595 | (138,371) | (10,849) | 514,166 | 562,818 | 298,761 | 1,324 | 1,152 | |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Consolidation and deconsolidation of funds, net | 1,475 | 1,475 | ||||||||
Changes in ownership interests and related tax benefits | 94 | (9,702) | 9,796 | 4 | (4) | |||||
Expenses incurred upon issuance of common stock | (181) | (181) | ||||||||
Capital contributions | (9,341) | 229 | (9,570) | |||||||
Dividends/Distributions | (259,831) | (57,620) | (59,949) | (136,837) | (5,425) | |||||
Net income (loss) | 216,676 | 50,946 | 75,119 | 85,186 | 5,425 | |||||
Currency translation adjustment, net of tax | 2,687 | (388) | (54) | 3,129 | ||||||
Equity compensation | 28,683 | 15,500 | 13,183 | |||||||
Stock option exercises | 47,890 | 47,865 | 25 | |||||||
Ending balance at Jun. 30, 2020 | 2,003,748 | 800,077 | (145,045) | (11,237) | 552,490 | 506,201 | 298,761 | 1,353 | 1,148 | |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Changes in ownership interests and related tax benefits | (3,751) | (122,555) | 118,804 | 2 | (2) | |||||
Issuances of common stock | 305,338 | 305,261 | 77 | |||||||
Capital contributions | 499 | 481 | 18 | |||||||
Dividends/Distributions | (135,393) | (61,159) | (49,391) | (19,418) | (5,425) | |||||
Net income (loss) | 142,334 | 42,120 | 52,162 | 42,627 | 5,425 | |||||
Currency translation adjustment, net of tax | 16,251 | 4,450 | 4,128 | 7,673 | ||||||
Equity compensation | 30,337 | 16,921 | 13,416 | |||||||
Stock option exercises | 11,518 | 11,512 | 6 | |||||||
Ending balance at Sep. 30, 2020 | 2,370,881 | 1,011,697 | (164,084) | (6,787) | 691,609 | 537,101 | 298,761 | 1,438 | 1,146 | |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Changes in ownership interests and related tax benefits | (21,409) | 508 | (21,922) | 27 | (22) | |||||
Issuances of common stock | 1 | 1 | ||||||||
Capital contributions | 11,275 | 2,558 | 8,717 | |||||||
Dividends/Distributions | (199,008) | (61,577) | (50,246) | (81,760) | (5,425) | |||||
Net income (loss) | 242,248 | 73,837 | 96,308 | 66,678 | 5,425 | |||||
Currency translation adjustment, net of tax | 22,460 | 7,270 | 6,206 | 8,984 | ||||||
Equity compensation | 31,409 | 17,553 | 13,856 | |||||||
Stock option exercises | 13,917 | 13,910 | 7 | |||||||
Ending balance at Dec. 31, 2020 | 2,471,774 | 1,043,669 | (151,824) | 483 | 738,369 | 539,720 | 298,761 | 1,472 | $ 0 | 1,124 |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Changes in ownership interests and related tax benefits | (86,139) | (41,686) | (44,477) | 26 | (2) | |||||
Capital contributions | 11,011 | 11,011 | ||||||||
Dividends/Distributions | (186,022) | (74,684) | (67,084) | (38,829) | (5,425) | |||||
Net income (loss) | 164,278 | 52,953 | 56,042 | 49,858 | 5,425 | |||||
Currency translation adjustment, net of tax | (9,983) | (545) | (366) | (9,072) | ||||||
Equity compensation | 55,649 | 31,752 | 23,897 | |||||||
Ending balance at Mar. 31, 2021 | 2,420,568 | 1,033,735 | (173,555) | (62) | 706,381 | 552,688 | 298,761 | 1,498 | 0 | 1,122 |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Changes in ownership interests and related tax benefits | (22,016) | (165,886) | 143,867 | 3 | 0 | |||||
Issuances of common stock | 827,430 | 827,273 | 122 | 35 | ||||||
Capital contributions | 352,643 | 317,595 | 34,994 | 54 | ||||||
Redemption of preferred stock | (310,000) | (310,000) | ||||||||
Dividends/Distributions | (185,295) | (82,825) | (63,585) | (33,460) | (5,425) | |||||
Net income (loss) | 270,982 | 124,980 | 124,311 | 5,027 | 16,664 | |||||
Currency translation adjustment, net of tax | 3,272 | 758 | 558 | 1,956 | ||||||
Equity compensation | 69,504 | 41,003 | 28,501 | |||||||
Stock option exercises | 14,027 | 14,019 | 8 | |||||||
Ending balance at Jun. 30, 2021 | 3,441,115 | 1,750,144 | (131,400) | 696 | 1,257,628 | 561,205 | 0 | 1,631 | 35 | 1,176 |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Changes in ownership interests and related tax benefits | (107,650) | 79,787 | (187,454) | 38 | (21) | |||||
Capital contributions | 85,138 | 211,444 | (126,339) | 33 | ||||||
Dividends/Distributions | (162,871) | (82,307) | (68,083) | (12,481) | ||||||
Net income (loss) | 216,389 | 84,726 | 84,293 | 47,370 | ||||||
Currency translation adjustment, net of tax | (10,968) | (3,267) | (2,346) | (5,355) | ||||||
Equity compensation | 65,991 | 38,607 | 27,384 | |||||||
Stock option exercises | 13,382 | 13,375 | 7 | |||||||
Ending balance at Sep. 30, 2021 | $ 3,540,526 | $ 1,881,913 | $ (128,981) | $ (2,571) | $ 1,322,866 | $ 464,400 | $ 0 | $ 1,676 | $ 35 | $ 1,188 |
Condensed Consolidated Statem_6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net income | $ 652,342 | $ 82,206 |
Net cash provided by (used in) operating activities | (1,843,751) | 12,462 |
Cash flows from investing activities: | ||
Net cash used in investing activities | (1,072,578) | (126,437) |
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||
Net cash provided by financing activities | 2,692,984 | 827,550 |
Effect of exchange rate changes | (20,763) | 16,793 |
Net change in cash and cash equivalents | (244,108) | 730,368 |
Cash and cash equivalents, beginning of period | 539,812 | |
Cash and cash equivalents, end of period | 295,704 | 868,752 |
Supplemental disclosure of non-cash financing activities: | ||
Issuance of AOG Units in connection with acquisitions | 511,069 | 305,338 |
Consolidated Funds | ||
Cash flows from operating activities: | ||
Adjustments to reconcile net income to net cash provided by operating activities | (1,688,085) | (766,399) |
Cash flows due to changes in operating assets and liabilities | (729,703) | 366,367 |
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||
Contributions from redeemable and non-controlling interests in Consolidated Funds | 919,666 | 123,713 |
Distributions to non-controlling interests in Consolidated Funds | (84,770) | (169,747) |
Borrowings under loan obligations by Consolidated Funds | 1,456,887 | 618,207 |
Repayments under loan obligations by Consolidated Funds | (74,909) | (104,794) |
Ares Management L.P | ||
Cash flows from operating activities: | ||
Adjustments to reconcile net income to net cash provided by operating activities | 71,133 | 184,586 |
Cash flows due to changes in operating assets and liabilities | (149,438) | 145,702 |
Cash flows from investing activities: | ||
Purchase of furniture, equipment and leasehold improvements, net of disposals | (15,152) | (8,608) |
Acquisitions, net of cash acquired | (1,057,426) | (117,829) |
Cash flows from financing activities: | ||
Net proceeds from issuance of Class A and non-voting common stock | 827,430 | 383,154 |
Proceeds from Credit Facility | 468,000 | 790,000 |
Proceeds from issuance of senior and subordinated notes | 450,000 | 399,084 |
Repayments of Credit Facility | (318,000) | (860,000) |
Dividends and distributions | (438,568) | (334,957) |
Series A Preferred Stock dividends | (10,850) | (16,275) |
Redemption of Series A Preferred Stock | (310,000) | 0 |
Stock option exercises | 27,409 | 78,959 |
Taxes paid related to net share settlement of equity awards | (221,287) | (75,657) |
Other financing activities | 1,976 | (4,137) |
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||
Cash and cash equivalents, beginning of period | 539,812 | 138,384 |
Cash and cash equivalents, end of period | $ 295,704 | $ 868,752 |
ORGANIZATION
ORGANIZATION | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | 1. ORGANIZATION Ares Management Corporation (the “Company”), a Delaware corporation, together with its subsidiaries, is a leading global alternative investment manager operating integrated groups across Credit, Private Equity, Real Estate, Secondary Solutions and Strategic Initiatives. Information about segments should be read together with “Note 15. Segment Reporting.” Subsidiaries of the Company serve as the general partners and/or investment managers to various investment funds and managed accounts within each investment group (the “Ares Funds”). These subsidiaries provide investment advisory services to the Ares Funds in exchange for management fees. The accompanying unaudited financial statements include the condensed consolidated results of the Company and its subsidiaries. The Company is a holding company, and the Company's assets include equity interests in Ares Holdings Inc., Ares Offshore Holdings, Ltd., and Ares AI Holdings L.P. In this quarterly report, the following of the Company’s subsidiaries are collectively referred to as the “Ares Operating Group” or “AOG”: Ares Offshore Holdings L.P. (“Ares Offshore”), Ares Holdings L.P. (“Ares Holdings”), and Ares Investments L.P. (“Ares Investments”). The Company, indirectly through its wholly owned subsidiaries, is the general partner of each of the Ares Operating Group entities. The Company operates and controls all of the businesses and affairs of and conducts all of its material business activities through the Ares Operating Group. On April 1, 2021, the Company completed an internal reorganization (the “Reorganization”) that simplified the organizational structure and merged Ares Offshore and Ares Investments with Ares Holdings. As a result of the Reorganization, Ares Holdings became the sole entity in the Ares Operating Group. The Company and its wholly owned subsidiaries manages or controls certain entities that have been consolidated in the accompanying financials statements as described in “Note 2. Summary of Significant Accounting Policies.” These entities include Ares funds, co-investment entities, collateralized loan obligations or funds (collectively “CLOs”) and a special purpose acquisition company (“SPAC”) (collectively, the “Consolidated Funds”). In February 2021, the Company’s first sponsored SPAC, Ares Acquisition Corporation (NYSE: AAC) (“AAC”), consummated its initial public offering that raised capital of $1.0 billion. Prior to the completion of a business combination, the sponsor, a wholly owned subsidiary of the Company, owns the majority of the Class B ordinary shares outstanding of AAC, and consolidates AAC under the voting interest model. Including the results of the Consolidated Funds significantly increases the reported amounts of the assets, liabilities, revenues, expenses and cash flows in the accompanying consolidated financial statements; however, the Consolidated Funds results included herein have no direct effect on the net income attributable to Ares Management Corporation or to Stockholders' Equity. Instead, economic ownership interests of the investors in the Consolidated Funds are reflected as redeemable and non-controlling interests in Consolidated Funds. Further, cash flows allocable to redeemable and non-controlling interest in Consolidated Funds are specifically identifiable in the Consolidated Statements of Cash Flows. Redeemable Interest and Non-Controlling Interests in Ares Operating Group Entities The non-controlling interests in AOG entities represent a component of equity and net income attributable to the owners of the Ares Operating Group Units (“AOG Units”) that are not held directly or indirectly by the Company. These owners consist predominantly of Ares Owners Holdings L.P. but also include other strategic distribution partnerships with whom the Company has established joint ventures. Non-controlling interests in AOG entities are adjusted for contributions to and distributions from AOG during the reporting period and are allocated income from the AOG entities based on their historical ownership percentage for the proportional number of days in the reporting period. On February 21, 2020, the Company completed its acquisition (“Crestline Acquisition”) of the Class A membership interests (the “Class A membership interests”) in Crestline Denali Capital LLC (“Crestline Denali”). The Class A membership interests entitle the Company to the fees associated with managing seven collateral management contracts. The Class B membership interests of Crestline Denali (the “Class B membership interests”) were retained by the former owners of Crestline Denali and represent the financial interests in the subordinated notes of the collateralized loan obligations. In connection with the Company's control over Crestline Denali, the Company also consolidates investments and financial results that are attributable to the Class B membership interests to which the Company has no economic rights or obligations. Equity and income (loss) attributable to the Class B membership interests is included within non-controlling interests in AOG entities. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying condensed consolidated financial statements are prepared in accordance with the generally accepted accounting principles in the United States (“GAAP”) for interim financial information and instructions to the Quarterly Report on Form 10-Q. The condensed consolidated financial statements, including these notes, are unaudited and exclude some of the disclosures required in annual financial statements. Management believes it has made all necessary adjustments so that the condensed consolidated financial statements are presented fairly and that estimates made in preparing its condensed consolidated financial statements are reasonable and prudent, and that all such adjustments are of a normal recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission (“SEC”). As of September 30, 2021, the impact of the outbreak of the novel coronavirus (“COVID-19”) pandemic continues to unfold. As a result, management's estimates and assumptions may be subject to a higher degree of variability and volatility that may result in material differences from the current period. The condensed consolidated financial statements include the accounts and activities of the AOG entities, their consolidated subsidiaries and certain Consolidated Funds. All intercompany balances and transactions have been eliminated upon consolidation. The Company has reclassified certain prior period amounts to conform to the current year presentation. Business Combinations The Company accounts for business combinations using the acquisition method of accounting, under which the purchase price of the acquisition, including the fair value of certain elements of contingent consideration, is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. Contingent consideration obligations are recognized as of the acquisition date at fair value based on the probability that contingency will be realized. Any fair value of purchase consideration in excess of the fair value of the assets acquired less liabilities assumed is recorded as goodwill. Conversely, any excess of the fair value of the net assets acquired over the purchase consideration is recognized as a bargain purchase gain. Acquisition-related costs incurred in connection with a business combination are expensed as incurred. U.S. Treasury Securities, at Fair Value U.S. Treasury securities, at fair value represents U.S. Treasury bills that were purchased with funds raised through the initial public offering of AAC, a consolidated SPAC that is presented within Consolidated Funds. The funds raised are held in a trust account that is restricted for use and may only be used for purposes of completing an initial business combination or redemption of public shares as set forth in the trust agreement. The U.S. Treasury bills have original maturities greater than three months when purchased and therefore are recorded at fair value. Interest income received on such securities is separately presented from the overall change in fair value and is recognized within interest and other income of Consolidated Funds in the Condensed Consolidated Statements of Operations. Any remaining change in fair value of such securities, that is not recognized as interest income, is recognized in net realized and unrealized gains (losses) on investments of Consolidated Funds in the Condensed Consolidated Statements of Operations. Redeemable Interest in Consolidated Funds Redeemable interest in Consolidated Funds represent the Class A ordinary shares issued by AAC that are redeemable for cash by the public shareholders in the event that AAC does not complete a business combination or tender offer associated with stockholder approval provisions. The class A ordinary shareholders have redemption rights that are considered to be outside of AAC’s control. At each balance sheet date, the carrying value of the redeemable interest is presented at the redemption amount. At September 30, 2021, all 100,000,000 Class A ordinary shares of AAC were classified outside of permanent equity. Recent Accounting Pronouncements The Company considers the applicability and impact of all accounting standard updates (“ASU”) issued by the Financial Accounting Standards Board (“FASB”). ASUs not listed below were assessed and either determined to be not applicable or expected to have minimal impact on its condensed consolidated financial statements. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). The amendments in this update provide optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this update apply only to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued because of reference rate reform. In January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) , to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. An entity may elect to adopt the amendments in ASU 2020-04 and ASU 2021-01 at any time after March 12, 2020 but no later than December 31, 2022. The expedients and exceptions provided by the amendments do not apply to contract modifications and hedging relationships entered into or evaluated after December 31, 2022, except for hedging transactions as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. The Company is currently evaluating the impact of this guidance on its condensed consolidated financial statements. |
BUSINESS COMBINATIONS
BUSINESS COMBINATIONS | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
BUSINESS COMBINATIONS | 3. BUSINESS COMBINATIONS Acquisition of Landmark Partners, LLC (collectively with its subsidiaries, “Landmark”) On June 2, 2021, a subsidiary of the Company completed the acquisition of 100% of the equity interests of Landmark, a subsidiary of BrightSphere Investment Group Inc. (NYSE: BSIG) and Landmark Investment Holdings L.P., in accordance with the purchase agreement entered into on March 30, 2021 (the “Landmark Acquisition”). As a result of the Landmark Acquisition, the Company expanded into the secondaries market with Landmark’s focus of managing private equity, real estate and infrastructure secondaries funds. Following the completion of the Landmark Acquisition, the results of Landmark are included in a newly created Secondary Solutions Group segment. The acquisition date fair value of the consideration transferred totaled $1.1 billion, which consisted of the following: Cash $ 803,829 Equity (1) 299,640 Total $ 1,103,469 (1) 5,419,413 AOG Units were issued in connection with the Landmark Acquisition and increased Ares Owners Holdings L.P.’s ownership interest in the AOG entities. The following is a summary of the fair values of assets acquired and liabilities assumed for the Landmark Acquisition as of June 2, 2021, based upon third party valuations of certain intangible assets. The fair value of assets acquired and liabilities assumed are estimated to be: Cash $ 25,685 Other tangible assets 23,411 Intangible assets: Management contracts 425,880 Client relationships 197,160 Trade name 86,200 Total intangible assets 709,240 Total identifiable assets acquired 758,336 Accounts payable, accrued expenses and other liabilities 72,532 Net identifiable assets acquired 685,804 Goodwill 417,665 Net assets acquired $ 1,103,469 The Company incurred $4.9 million of acquisition related costs that were expensed and reported within general, administrative and other expenses within the Condensed Consolidated Statements of Operations. The carrying value of goodwill associated with Landmark was $417.7 million as of the acquisition date and is entirely allocated to the Secondary Solutions Group segment. The goodwill is attributable primarily to expected synergies and the assembled workforce of Landmark. In connection with the Landmark Acquisition, the Company allocated $425.9 million, $197.2 million and $86.2 million of the purchase price to the fair value of the management contracts, client relationships and trade name, respectively. The acquired management contracts and client relationships had a weighted average amortization period as of the acquisition date of 7.4 years and 11.8 years, respectively. The trade name was determined to have an indefinite useful life at the time of the Landmark Acquisition and is not subject to amortization as the Company intends Landmark to continue to operate under its brand name into perpetuity. Landmark’s revenues and net income of $54.0 million and $26.8 million, respectively, are included in the Company’s Consolidated Statements of Operations for the period from June 2, 2021 through September 30, 2021. Supplemental information of the Company’s consolidated results on an unaudited pro forma basis, as if the Landmark Acquisition had been consummated as of January 1, 2020, is as follows: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Total revenues $ 948,719 $ 527,105 $ 2,966,540 $ 1,214,989 Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 87,542 $ 37,570 $ 257,361 $ 41,263 The unaudited pro forma supplemental information is based on estimates and assumptions, which the Company believes are reasonable. These results are not necessarily indicative of the Company’s consolidated financial condition or statements of operations in future periods or the results that actually would have been realized had the Company and Landmark been a combined entity during the periods presented. These pro forma amounts have been calculated after applying the following adjustments that were directly attributable to the Landmark Acquisition: • adjustments to include the impact of the additional amortization that would have been charged assuming the fair value adjustments to intangible assets had been applied on January 1, 2020, together with the consequential tax effects; • adjustments to include the AOG Units issued as consideration for the Landmark Acquisition, as if they were issued on January 1, 2020, and the resulting change in ownership attributable to Ares Management Corporation; • adjustments to reflect the pro-rata economic ownership attributable to Ares Management Corporation; • adjustments to reflect the tax effects of the Landmark Acquisition and the related adjustments as if Landmark had been included in the Company’s results as of January 1, 2020; and • adjustments to include Landmark Acquisition related transaction costs in earnings for the nine months ended September 30, 2020. Purchase of Landmark GP Interests The Company acquired an ownership interest in Landmark Partners XVI - GP, L.P. and Landmark Real Estate Fund VIII – GP, L.P. (collectively referred to as the “Landmark GP Entities”). The ownership interest entitles the Company to 60% of the capital interests and a portion of the carried interest in Landmark Equity Partners XVI L.P., Landmark Real Estate Partners VIII L.P. and certain related co-investment vehicles. The Company’s control over Landmark GP Entities also results in the Company consolidating investments and financial results that are attributable to ownership interests that were retained by former Landmark owners. The economic rights retained by the former Landmark owners attributable to these interests are reflected as non-controlling interests in the AOG entities. Acquisition of Black Creek Group On July 1, 2021, a subsidiary of the Company completed the acquisition of 100% of the equity interests of Black Creek Group’s U.S. real estate investment advisory and distribution business (“Black Creek”) in accordance with the purchase agreement entered into on May 20, 2021 (the “Black Creek Acquisition”). Black Creek is a leading real estate investment management firm that operates in core and core-plus real estate strategies across two non-traded Real Estate Investment Trusts (“REITs”) and various institutional fund vehicles. Following the completion of the Black Creek Acquisition, the results of Black Creek are included within the Real Estate Group segment. In connection with the Black Creek Acquisition, the Company recorded a bargain purchase gain of $42.3 million that has been presented within other income (expense), net in the Condensed Consolidated Statements of Operations. The bargain purchase gain resulted from the fair value of the identifiable tangible and intangible assets acquired exceeding the purchase consideration. The purchase agreement with Black Creek contains provisions obligating the Company to make a payment upon the achievement of certain revenue targets to certain senior professionals and advisors that is excluded from purchase consideration as it is subject to continued and future service. See “Note 9. Commitments and Contingencies” for a further description of this contingency. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | 4. GOODWILL AND INTANGIBLE ASSETS Intangible Assets, Net The following table summarizes the carrying value, net of accumulated amortization, of the Company's intangible assets: Weighted Average Amortization Period as of September 30, 2021 As of September 30, As of December 31, 2021 2020 Management contracts 6.5 years $ 641,737 $ 210,857 Client relationships 11.2 years 229,501 25,141 Trade name 8.7 years 11,079 11,079 Finite-lived intangible assets 882,317 247,077 Foreign currency translation 1,530 3,093 Total finite-lived intangible assets 883,847 250,170 Less: accumulated amortization (85,157) (28,082) Finite-lived intangible assets, net 798,690 222,088 Management contracts 567,800 — Trade name 86,200 — Indefinite-lived intangible assets 654,000 — Intangible assets, net $ 1,452,690 $ 222,088 In connection with the Black Creek Acquisition, the Company allocated $576.2 million and $7.2 million of the purchase consideration to the fair value of management contracts and client relationships, respectively. Certain management contracts were determined to have indefinite useful lives at the time of the Black Creek Acquisition and are not subject to amortization. The remaining management contracts and client relationships had a weighted average amortization period as of the acquisition date of 6.1 years and 12.0 years, respectively. Amortization expense associated with intangible assets was $32.8 million and $11.1 million for the three months ended September 30, 2021 and 2020, respectively, and $60.7 million and $13.7 million for the nine months ended September 30, 2021 and 2020 and is presented within general, administrative and other expenses within the Condensed Consolidated Statements of Operations. During the third quarter of 2021, the Company accelerated the amortization of a collateral management contract due to the redemption of that CLO and removed $3.4 million of intangible assets that were fully amortized. Goodwill The following table summarizes the carrying value of goodwill that is included within other assets in the Condensed Consolidated Statements of Financial Condition: Credit Group Private Real Secondary Solutions Group Strategic Initiatives Total Balance as of December 31, 2020 $ 32,196 $ 58,600 $ 53,120 $ — $ 227,131 $ 371,047 Acquisitions — — — 417,665 — 417,665 Foreign currency translation — — 219 (16) (1,165) (962) Balance as of September 30, 2021 $ 32,196 $ 58,600 $ 53,339 $ 417,649 $ 225,966 $ 787,750 There was no impairment of goodwill recorded during the nine months ended September 30, 2021 and 2020. The impact of foreign currency translation is reflected within other comprehensive income. |
INVESTMENTS
INVESTMENTS | 9 Months Ended |
Sep. 30, 2021 | |
Investments in and Advances to Affiliates [Abstract] | |
INVESTMENTS | 5. INVESTMENTS The Company’s investments are comprised of the following: Percentage of total investments September 30, December 31, September 30, December 31, 2021 2020 2021 2020 Equity method investments: Equity method private investment partnership interests - principal (1) $ 492,482 $ 366,471 14.8 % 21.8 % Equity method - carried interest (1) 2,625,319 1,145,853 79.0 68.1 Equity method private investment partnership interests and other (held at fair value) (1) 117,015 92,196 3.5 5.5 Equity method private investment partnership interests and other (1) 32,132 23,883 1.0 1.4 Total equity method investments 3,266,948 1,628,403 98.3 96.8 Collateralized loan obligations (2) 32,724 31,766 1.0 1.9 Other fixed income 21,583 21,583 0.6 1.3 Collateralized loan obligations and other fixed income, at fair value 54,307 53,349 1.6 3.2 Common stock, at fair value 1,410 1,007 0.1 0.1 Total investments $ 3,322,665 $ 1,682,759 (1) Investment or portion of the investment is denominated in foreign currency and is translated into U.S. dollars at each reporting date. (2) As of September 30, 2021 and December 31, 2020, includes $3.2 million and $3.4 million, respectively, of collateralized loan obligations that are attributable to the Class B Membership Interests. Equity Method Investments The Company’s equity method investments include investments that are not consolidated but over which the Company exerts significant influence. The Company evaluates each of its equity method investments to determine if any were significant as defined by guidance from the SEC. As of and for the three and nine months ended September 30, 2021 and 2020, no individual equity method investment held by the Company met the significance criteria. The Company recognized net gains related to its equity method investments of $18.9 million and $8.9 million for the three months ended September 30, 2021 and 2020, respectively, and net gains of $99.3 million and $1.8 million for the nine months ended September 30, 2021 and 2020, respectively. The net gains were included within principal investment income, net realized and unrealized gains (losses) on investments, and interest and dividend income within the Condensed Consolidated Statements of Operations. With respect to the Company's equity method investments, the material assets are expected to generate either long-term capital appreciation and/or interest income, the material liabilities are debt instruments collateralized by, or related to, the financing of the assets and net income is materially comprised of the changes in fair value of these net assets. Investments of the Consolidated Funds Investments held in the Consolidated Funds are summarized below: Fair Value at Percentage of total investments as of September 30, December 31, September 30, December 31, 2021 2020 2021 2020 Fixed income investments: Bonds $ 434,226 $ 397,494 3.9 % 3.6% Loans 9,389,769 10,012,948 82.6 92.1 U.S. Treasury securities 1,000,165 — 8.8 — Investments in CLO warehouse 28,500 — 0.3 — Total fixed income investments 10,852,660 10,410,442 95.6 95.7 Equity securities 264,202 227,031 2.3 2.1 Partnership interests 244,157 239,624 2.1 2.2 Total investments, at fair value $ 11,361,019 $ 10,877,097 As of September 30, 2021, the SPAC’s investment in U.S. Treasury bills exceeded 5.0% of the Company’s total assets. The U.S. Treasury bills mature in November 2021 and have an interest yield of approximately 0.06%. At December 31, 2020, no single issuer or investment, including derivative instruments and underlying portfolio investments of the Consolidated Funds, had a fair value that exceeded 5.0% of the Company’s total assets. |
FAIR VALUE
FAIR VALUE | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | 6. FAIR VALUE Fair Value Measurements GAAP establishes a hierarchical disclosure framework that prioritizes the inputs used in measuring financial instruments at fair value into three levels based on their market price observability. Market price observability is affected by a number of factors, including the type of instrument and the characteristics specific to the instrument. Financial instruments with readily available quoted prices from an active market or for which fair value can be measured based on actively quoted prices generally have a higher degree of market price observability and a lesser degree of judgment inherent in measuring fair value. Financial assets and liabilities measured and reported at fair value are classified as follows: • Level I —Quoted prices in active markets for identical instruments. • Level II —Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in inactive markets; and model-derived valuations with directly or indirectly observable significant inputs. Level II inputs include prices in markets with few transactions, non-current prices, prices for which little public information exists or prices that vary substantially over time or among brokered market makers. Other inputs include interest rates, yield curves, volatilities, prepayment risks, loss severities, credit risks and default rates. • Level III —Valuations that rely on one or more significant unobservable inputs. These inputs reflect the Company’s assessment of the assumptions that market participants would use to value the instrument based on the best information available. In some instances, an instrument may fall into more than one level of the fair value hierarchy. In such instances, the instrument’s level within the fair value hierarchy is based on the lowest of the three levels (with Level III being the lowest) that is significant to the fair value measurement. The Company’s assessment of the significance of an input requires judgment and considers factors specific to the instrument. The Company accounts for the transfer of assets into or out of each fair value hierarchy level as of the beginning of the reporting period. Contingent consideration: The Company generally determines the fair value of its contingent consideration liabilities by using a Monte Carlo simulation model. The model considers a range of assumptions including historical experience, prior period performance, current progress towards targets, probability-weighted scenarios, and management's own assumptions. The discount rate used is determined based on the weighted average cost of capital for the Company. The fair value of the Company's contingent consideration liabilities are classified as Level III. Liabilities recorded in connection with the Company’s contingent consideration are included within accounts payable, accrued expenses and other liabilities in the Condensed Consolidated Statements of Financial Condition and the associated changes in fair value are included within other income (expense), net in the Condensed Consolidated Statements of Operations. Fair Value of Financial Instruments Held by the Company and Consolidated Funds The following tables summarize the financial assets and financial liabilities measured at fair value for the Company and the Consolidated Funds as of September 30, 2021: Financial Instruments of the Company Level I Level II Level III Investments Total Assets, at fair value Investments: Collateralized loan obligations and other fixed income $ — $ — $ 54,307 $ — $ 54,307 Common stock and other equity securities — 1,410 108,397 — 109,807 Partnership interests — — 2,575 6,043 8,618 Total investments, at fair value — 1,410 165,279 6,043 172,732 Derivatives-foreign exchange contracts and interest rate contracts — 4,361 — — 4,361 Total assets, at fair value $ — $ 5,771 $ 165,279 $ 6,043 $ 177,093 Liabilities, at fair value Derivatives-foreign exchange contracts — (265) — — (265) Contingent consideration — — (41,413) — (41,413) Total liabilities, at fair value $ — $ (265) $ (41,413) $ — $ (41,678) Financial Instruments of the Consolidated Funds Level I Level II Level III Investments Total Assets, at fair value Investments: Fixed income investments: Bonds $ — $ 406,253 $ 27,973 $ — $ 434,226 Loans — 9,015,066 374,703 — 9,389,769 U.S. Treasury securities 1,000,165 — — — 1,000,165 Investments in CLO warehouse — 28,500 — — 28,500 Total fixed income investments 1,000,165 9,449,819 402,676 — 10,852,660 Equity securities 3,366 1,590 259,246 — 264,202 Partnership interests — — 237,558 6,599 244,157 Total investments, at fair value $ 1,003,531 $ 9,451,409 $ 899,480 $ 6,599 $ 11,361,019 Derivatives: Asset swaps-other — — 325 — 325 Total derivative assets, at fair value — — 325 — 325 Total assets, at fair value $ 1,003,531 $ 9,451,409 $ 899,805 $ 6,599 $ 11,361,344 Liabilities, at fair value Derivatives: Warrants $ (17,000) $ — $ — $ — $ (17,000) Asset swaps-other — — (1,513) — (1,513) Total derivative liabilities, at fair value (17,000) — (1,513) — (18,513) Loan obligations of CLOs — (10,174,794) — — (10,174,794) Total liabilities, at fair value $ (17,000) $ (10,174,794) $ (1,513) $ — $ (10,193,307) The following tables summarize the financial assets and financial liabilities measured at fair value for the Company and the Consolidated Funds as of December 31,2020: Financial Instruments of the Company Level I Level II Level III Investments Total Assets, at fair value Investments: Collateralized loan obligations and other fixed income $ — $ — $ 53,349 $ — $ 53,349 Common stock and other equity securities — 1,007 88,412 — 89,419 Partnership interests — — 2,575 1,209 3,784 Total investments, at fair value — 1,007 144,336 1,209 146,552 Derivatives-foreign exchange contracts — 1,440 — — 1,440 Total assets, at fair value $ — $ 2,447 $ 144,336 $ 1,209 $ 147,992 Liabilities, at fair value Derivatives-foreign exchange contracts $ — $ (1,565) $ — $ — $ (1,565) Total liabilities, at fair value $ — $ (1,565) $ — $ — $ (1,565) Financial Instruments of the Consolidated Funds Level I Level II Level III Investments Measured Total Assets, at fair value Investments: Fixed income investments: Bonds $ — $ 397,485 $ 9 $ — $ 397,494 Loans — 9,470,651 542,297 — 10,012,948 Total fixed income investments — 9,868,136 542,306 — 10,410,442 Equity securities 5,749 239 221,043 — 227,031 Partnership interests — — 231,857 7,767 239,624 Total investments, at fair value 5,749 9,868,375 995,206 7,767 10,877,097 Derivatives: Asset swaps-other — — 1,104 — 1,104 Total assets, at fair value $ 5,749 $ 9,868,375 $ 996,310 $ 7,767 $ 10,878,201 Liabilities, at fair value Derivatives: Asset swaps-other $ — $ — $ (44) $ — $ (44) Loan obligations of CLOs — (9,958,076) — — (9,958,076) Total liabilities, at fair value $ — $ (9,958,076) $ (44) $ — $ (9,958,120) The following tables set forth a summary of changes in the fair value of the Level III measurements for the three months ended September 30, 2021: Level III Assets and Liabilities of the Company Equity Securities Fixed Income Partnership Interests Contingent Consideration Total Balance, beginning of period $ 107,240 $ 55,840 $ 2,575 $ — $ 165,655 Established in connection with acquisition — — — (34,200) (34,200) Purchases (1) — 708 — — 708 Sales/settlements (2) — (2,904) — — (2,904) Realized and unrealized appreciation (depreciation), net 1,157 663 — (7,213) (5,393) Balance, end of period $ 108,397 $ 54,307 $ 2,575 $ (41,413) $ 123,866 Change in net unrealized appreciation/depreciation included in earnings related to financial assets and liabilities still held at the reporting date $ 1,157 $ 675 $ — $ (7,213) $ (5,381) Level III Net Assets of Consolidated Funds Equity Securities Fixed Income Partnership Derivatives, Net Total Balance, beginning of period $ 229,300 $ 455,426 $ 255,278 $ (1,658) $ 938,346 Transfer in — 18,792 — — 18,792 Transfer out — (209,282) — — (209,282) Purchases (1) 27,346 219,180 — — 246,526 Sales/settlements (2) (313) (88,584) (30,000) 625 (118,272) Amortized discounts/premiums — 394 — — 394 Realized and unrealized appreciation (depreciation), net 2,913 6,750 12,280 (155) 21,788 Balance, end of period $ 259,246 $ 402,676 $ 237,558 $ (1,188) $ 898,292 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 2,912 $ 1,607 $ 12,280 $ (63) $ 16,736 (1) Purchases include paid-in-kind interest and securities received in connection with restructuring. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the three months ended September 30, 2020: Level III Assets of the Company Equity Securities Fixed Income Partnership Interests Total Balance, beginning of period $ 14,704 $ 67,355 $ 2,575 $ 84,634 Transfer in due to changes in consolidation 72,967 — — 72,967 Purchases (1) — 5,983 — 5,983 Sales/settlements (2) — (899) — (899) Realized and unrealized appreciation (depreciation), net (1,746) 3,175 — 1,429 Balance, end of period $ 85,925 $ 75,614 $ 2,575 $ 164,114 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (1,746) $ 3,175 $ — $ 1,429 Level III Net Assets of Consolidated Funds Equity Securities Fixed Income Partnership Interests Derivatives, Net Total Balance, beginning of period $ 42,259 $ 586,287 $ 312,636 $ 1,402 $ 942,584 Transfer in — 96,671 — — 96,671 Transfer out — (230,326) — — (230,326) Purchases (1) 150 118,558 — — 118,708 Sales/settlements (2) (25) (73,010) (2,000) 705 (74,330) Amortized discounts/premiums — (135) — 140 5 Realized and unrealized appreciation (depreciation), net 828 15,836 (1,402) (393) 14,869 Balance, end of period $ 43,212 $ 513,881 $ 309,234 $ 1,854 $ 868,181 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 878 $ 13,690 $ (1,402) $ (604) $ 12,562 (1) Purchases include paid-in-kind interest and securities received in connection with restructurings. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the nine months ended September 30, 2021: Level III Assets and Liabilities of the Company Equity Fixed Income Partnership Interests Contingent Consideration Total Balance, beginning of period $ 88,412 $ 53,349 $ 2,575 $ — $ 144,336 Transfer in due to changes in consolidation — 7,623 — — 7,623 Established in connection with acquisition — — — (34,200) (34,200) Purchases (1) 19,278 1,689 — — 20,967 Sales/settlements (2) — (12,120) — — (12,120) Realized and unrealized appreciation (depreciation), net 707 3,766 — (7,213) (2,740) Balance, end of period $ 108,397 $ 54,307 $ 2,575 $ (41,413) $ 123,866 Change in net unrealized appreciation/depreciation included in earnings related to financial assets and liabilities still held at the reporting date $ 707 $ 2,315 $ — $ (7,213) $ (4,191) Level III Net Assets of Consolidated Funds Equity Fixed Partnership Derivatives, Net Total Balance, beginning of period $ 221,043 $ 542,305 $ 231,857 $ 1,060 $ 996,265 Transfer out due to changes in consolidation (157) (49,326) — — (49,483) Transfer in 2,195 47,818 — — 50,013 Transfer out (33) (216,177) — — (216,210) Purchases (1) 36,201 437,426 13,000 — 486,627 Sales/settlements (2) (876) (371,006) (32,000) 301 (403,581) Amortized discounts/premiums 1 1,464 — — 1,465 Realized and unrealized appreciation (depreciation), net 872 10,172 24,701 (2,549) 33,196 Balance, end of period $ 259,246 $ 402,676 $ 237,558 $ (1,188) $ 898,292 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 790 $ 2,700 $ 24,701 $ (1,670) $ 26,521 (1) Purchases include paid-in-kind interest and securities received in connection with restructuring. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the nine months ended September 30, 2020: Level III Assets and Liabilities of the Company Equity Fixed Income Partnership Interests Total Balance, beginning of period $ 14,704 $ 69,183 $ 35,192 $ 119,079 Transfer in due to changes in consolidation 72,967 3,686 — 76,653 Purchases (1) — 7,285 — 7,285 Sales/settlements (2) — (1,587) (32,430) (34,017) Realized and unrealized depreciation, net (1,746) (2,953) (187) (4,886) Balance, end of period $ 85,925 $ 75,614 $ 2,575 $ 164,114 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (1,746) $ (1,917) $ 5,511 $ 1,848 Level III Net Assets of Consolidated Funds Equity Fixed Partnership Interests Derivatives, Net Total Balance, beginning of period $ 85,988 $ 339,136 $ 296,012 $ (4,106) $ 717,030 Transfer in (out) due to changes in consolidation (635) 392,672 — — 392,037 Transfer in — 146,839 — — 146,839 Transfer out — (350,078) — — (350,078) Purchases (1) 551 256,514 64,000 — 321,065 Sales/settlements (2) (714) (249,027) (58,000) 813 (306,928) Amortized discounts/premiums — 777 — 291 1,068 Realized and unrealized appreciation (depreciation), net (41,978) (22,952) 7,222 4,856 (52,852) Balance, end of period $ 43,212 $ 513,881 $ 309,234 $ 1,854 $ 868,181 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (41,930) $ (25,701) $ 7,222 $ 4,439 $ (55,970) (1) Purchases include paid-in-kind interest and securities received in connection with restructurings. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. Transfers out of Level III were generally attributable to certain investments that experienced a more significant level of market activity during the period and thus were valued using observable inputs either from independent pricing services or multiple brokers. Transfers into Level III were generally attributable to certain investments that experienced a less significant level of market activity during the period and thus were only able to obtain one or fewer quotes from a broker or independent pricing service. The following tables summarize the quantitative inputs and assumptions used for the Company’s and the Consolidated Funds' Level III measurements as of September 30, 2021: Level III Measurements of the Company Fair Value Valuation Technique(s) Significant Unobservable Input(s) Range Weighted Average Assets Equity securities $ 14,704 Transaction price (1) N/A N/A N/A 46,765 Discounted cash flow Discount Rates 14.0% - 20.0% 15.3% 46,928 Market approach Multiple of Book Value 1.5x N/A Partnership interests 2,575 Other N/A N/A N/A Collateralized loan obligations 32,724 Broker quotes and/or 3rd party pricing services N/A N/A N/A Other fixed income 21,583 Other N/A N/A N/A Total assets $ 165,279 Liabilities Contingent consideration $ (8,600) Monte Carlo simulation Discount Rates 8% N/A Volatility 17% N/A $ (32,813) Other N/A N/A N/A Total liabilities $ (41,413) Level III Measurements of the Consolidated Funds Fair Value Valuation Technique(s) Significant Unobservable Input(s) Range Weighted Average Assets Equity securities $ 896 Market approach EBITDA multiple (2) 1.8x - 83.3x 15.3x 14 Broker quotes and/or 3rd party pricing services N/A N/A N/A 258,336 Transaction price (1) N/A N/A N/A Partnership interest 237,558 Discounted cash flow Discount rate 22.4% 22.4% Fixed income securities 261,064 Broker quotes and/or 3rd party pricing services N/A N/A N/A 98,055 Income approach Yield 1.8%-54.7% 6.5% 14,791 Transaction price N/A N/A N/A 28,766 Other N/A N/A N/A Derivative instruments 325 Broker quotes and/or 3rd party pricing services N/A N/A N/A Total assets $ 899,805 Liabilities Derivative instruments $ (1,513) Broker quotes and/or 3rd party pricing services N/A N/A N/A Total liabilities $ (1,513) (1) Transaction price consists of securities purchased or restructured. The Company determined that there was no change to the valuation based on the underlying assumptions used at the closing of such transactions. (2) “EBITDA” in the table above is a non-GAAP financial measure and refers to earnings before interest, tax, depreciation and amortization. The following tables summarize the quantitative inputs and assumptions used for the Company’s and the Consolidated Funds' Level III measurements as of December 31, 2020: Level III Measurements of the Company Fair Value Valuation Technique(s) Significant Unobservable Input(s) Range Assets Equity securities $ 14,704 Transaction price (1) N/A N/A 32,905 Discounted Cash Flow Discount Rates 14.0% - 20.0% 40,803 Market Approach Multiple of Book Value 1.6x Partnership interests 2,575 Other N/A N/A Collateralized loan obligations 31,766 Broker quotes and/or 3rd party pricing services N/A N/A Other fixed income 21,583 Other N/A N/A Total $ 144,336 Level III Measurements of the Consolidated Funds Fair Value Valuation Technique(s) Significant Unobservable Input(s) Range Weighted Average Assets Equity securities $ 438 Market approach EBITDA multiple (2) 2.9x - 19.5x 13.4x 32,528 Other Net income multiple 30.0x 30.0x Illiquidity discount 25.0% 25.0% 33 Broker quotes and/or 3rd party pricing services N/A N/A N/A 188,044 Transaction price (1) N/A N/A N/A Partnership interests 231,857 Discounted cash flow Discount rate 23.8% 23.8% Fixed income securities 384,419 Broker quotes and/or 3rd party pricing services N/A N/A N/A 6,605 Market approach EBITDA multiple (2) 6.5x - 7.8x 6.9x 122,962 Income approach Yield 2.7% - 48.1% 7.9% 28,320 Other N/A N/A N/A Derivative instruments 1,104 Broker quotes and/or 3rd party pricing services N/A N/A N/A Total assets $ 996,310 Liabilities Derivative instruments $ (44) Broker quotes and/or 3rd party pricing services N/A N/A N/A Total liabilities $ (44) (1) Transaction price consists of securities purchased or restructured. The Company determined that there has been no change to the valuation based on the underlying assumptions used at the closing of such transactions. (2) “EBITDA” in the table above is a non-GAAP financial measure and refers to earnings before interest, tax, depreciation and amortization. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS | 7. DERIVATIVE FINANCIAL INSTRUMENTS In the normal course of business, the Company and the Consolidated Funds are exposed to certain risks relating to their ongoing operations and use various types of derivative instruments primarily to mitigate against credit and foreign exchange risk. The derivative instruments are not designated as hedging instruments under the accounting standards for derivatives and hedging. The Company recognizes all of its derivative instruments at fair value as either assets or liabilities in the Condensed Consolidated Statements of Financial Condition within other assets or accounts payable, accrued expenses and other liabilities, respectively. These amounts may be offset to the extent that there is a legal right to offset and if elected by management. The following tables identify the fair value and notional amounts of derivative contracts by major product type on a gross basis for the Company and the Consolidated Funds: As of September 30, 2021 As of December 31, 2020 Assets Liabilities Assets Liabilities The Company Notional (1) Fair Value Notional (1) Fair Value Notional (1) Fair Value Notional (1) Fair Value Foreign exchange contracts $ 81,008 $ 4,352 $ 9,868 $ 265 $ 30,040 $ 1,440 $ 39,362 $ 1,565 Interest rate contracts 18,455 9 — — — — — — Total derivatives, at fair value (2) $ 99,463 $ 4,361 $ 9,868 $ 265 $ 30,040 $ 1,440 $ 39,362 $ 1,565 As of September 30, 2021 As of December 31, 2020 Assets Liabilities Assets Liabilities Consolidated Funds Notional (1) Fair Value Notional (1) Fair Value Notional (1) Fair Value Notional (1) Fair Value Warrants $ — $ — $ 230,000 $ 17,000 $ — $ — $ — $ — Asset swap - other 44,521 325 39,701 1,513 7,600 1,104 540 44 Total derivatives, at fair value (3) $ 44,521 $ 325 $ 269,701 $ 18,513 $ 7,600 $ 1,104 $ 540 $ 44 (1) Represents the total contractual amount of derivative assets and liabilities outstanding. (2) As of September 30, 2021 and December 31, 2020, the Company had the right to, but elected not to, offset $0.3 million and $1.6 million of its derivative liabilities. (3) As of September 30, 2021 and December 31, 2020, the Consolidated Funds offset $0.3 million and $0.4 million of their derivative assets and liabilities, respectively. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
DEBT | 8. DEBT The following table summarizes the Company’s and its subsidiaries’ debt obligations: As of September 30, 2021 As of December 31, 2020 Debt Origination Date Maturity Original Borrowing Amount Carrying Interest Rate Carrying Interest Rate Credit Facility (1) Revolver 3/31/2026 N/A $ 150,000 1.13% $ — —% 2024 Senior Notes (2) 10/8/2014 10/8/2024 $ 250,000 247,802 4.21 247,285 4.21 2030 Senior Notes (3) 6/15/2020 6/15/2030 400,000 396,045 3.28 395,713 3.28 2051 Subordinated Notes (4) 6/30/2021 6/30/2051 450,000 444,478 4.13 — — Total debt obligations $ 1,238,325 $ 642,998 (1) The AOG entities are borrowers under the Credit Facility, which provides a $1.090 billion revolving line of credit. It has a variable interest rate based on LIBOR or a base rate plus an applicable margin with an unused commitment fee paid quarterly, which is subject to change with the Company’s underlying credit agency rating. On March 31, 2021, the Company amended the Credit Facility to, among other things, extend the maturity date from March 2025 to March 2026. As of September 30, 2021, base rate loans bear interest calculated based on the base rate plus 0.125% and the LIBOR rate loans bear interest calculated based on LIBOR plus 1.125%. The unused commitment fee is 0.10% per annum. There is a base rate and LIBOR floor of zero. (2) The 2024 Senior Notes were issued in October 2014 by Ares Finance Co. LLC, an indirect subsidiary of the Company, at 98.27% of the face amount with interest paid semi-annually. The Company may redeem the 2024 Senior Notes prior to maturity, subject to the terms of the indenture governing the 2024 Notes. (3) The 2030 Senior Notes were issued in June 2020 by Ares Finance Co. II LLC, an indirect subsidiary of the Company, at 99.77% of the face amount with interest paid semi-annually. The Company may redeem the 2030 Senior Notes prior to maturity, subject to the terms of the indenture governing the 2030 Notes. (4) The 2051 Subordinated Notes were issued in June 2021 by Ares Finance Co. III LLC, an indirect subsidiary of the Company, at 100.00% of par with interest paid semi-annually at a fixed-rate of 4.125%. Beginning June 30, 2026, the interest rate will reset on every fifth year based on the five-year U.S. Treasury Rate plus 3.237%. The Company may redeem the 2051 Subordinated Notes prior to maturity or defer interest payments up to five As of September 30, 2021, the Company and its subsidiaries were in compliance with all covenants under the debt obligations. The Company typically incurs and pays debt issuance costs when entering into a new debt obligation or when amending an existing debt agreement. Debt issuance costs related to the 2024 and 2030 Senior Notes (the “Senior Notes”) and 2051 Subordinated Notes are recorded as a reduction of the corresponding debt obligation, and debt issuance costs related to the Credit Facility are included in other assets in the Condensed Consolidated Statements of Financial Condition. All debt issuance costs are amortized over the remaining term of the related obligation into interest expense in the Condensed Consolidated Statements of Operations. The following table presents the activity of the Company's debt issuance costs: Credit Facility Senior Subordinated Notes Unamortized debt issuance costs as of December 31, 2020 $ 5,232 $ 4,283 $ — Debt issuance costs incurred 1,282 — 5,568 Amortization of debt issuance costs (929) (446) (46) Unamortized debt issuance costs as of September 30, 2021 $ 5,585 $ 3,837 $ 5,522 Loan Obligations of the Consolidated CLOs Loan obligations of the Consolidated Funds that are CLOs (“Consolidated CLOs”) represent amounts due to holders of debt securities issued by the Consolidated CLOs. The Company measures the loan obligations of the Consolidated CLOs using the fair value of the financial assets of its Consolidated CLOs. The following loan obligations were outstanding and classified as liabilities of the Consolidated CLOs: As of September 30, 2021 As of December 31, 2020 Loan Fair Value of Weighted Loan Fair Value of Loan Obligations Weighted Senior secured notes (1) $ 9,577,725 $ 9,561,079 9.5 $ 9,796,442 $ 9,665,804 10.1 Subordinated notes (2) 723,567 613,715 8.3 482,391 292,272 10.2 Total loan obligations of Consolidated CLOs $ 10,301,292 $ 10,174,794 $ 10,278,833 $ 9,958,076 (1) Original borrowings under the senior secured notes totaled $9.6 billion, with various maturity dates ranging from September 2026 to July 2034. The weighted average interest rate as of September 30, 2021 was 1.96%. (2) Original borrowings under the subordinated notes totaled $723.6 million, with various maturity dates ranging from September 2026 to July 2034. The notes do not have contractual interest rates; instead, holders of the notes receive distributions from the excess cash flows generated by each Consolidated CLO. Loan obligations of the Consolidated CLOs are collateralized by the assets held by the Consolidated CLOs, consisting of cash and cash equivalents, corporate loans, corporate bonds and other securities. The assets of one Consolidated CLO may not be used to satisfy the liabilities of another Consolidated CLO. Loan obligations of the Consolidated CLOs include floating rate notes, deferrable floating rate notes, revolving lines of credit and subordinated notes. Amounts borrowed under the notes are repaid based on available cash flows subject to priority of payments under each Consolidated CLO’s governing documents. Based on the terms of these facilities, the creditors of the facilities have no recourse to the Company. Credit Facilities of the Consolidated Funds Certain Consolidated Funds maintain credit facilities to fund investments between capital drawdowns. These facilities generally are collateralized by the unfunded capital commitments of the Consolidated Funds’ limited partners, bear an annual commitment fee based on unfunded commitments and contain various affirmative and negative covenants and reporting obligations, including restrictions on additional indebtedness, liens, margin stock, affiliate transactions, dividends and distributions, release of capital commitments and portfolio asset dispositions. The creditors of these facilities have no recourse to the Company and only have recourse to a subsidiary of the Company to the extent the debt is guaranteed by such subsidiary. As of September 30, 2021 and December 31, 2020, the Consolidated Funds were in compliance with all covenants under such credit facilities. The Consolidated Funds had the following revolving bank credit facilities and term loan outstanding: As of September 30, 2021 As of December 31, 2020 Consolidated Funds' Debt Facilities Maturity Date Total Capacity Outstanding Loan (1) Effective Rate Outstanding Loan (1) Effective Rate Credit Facilities: 3/4/2022 $ 71,500 $ 71,500 1.59% $ 71,500 1.59% 7/1/2023 18,000 17,740 1.63 17,909 1.75 1/15/2022 (2) — — — 32,500 2.75 7/23/2024 75,000 10,000 2.65 N/A N/A 9/24/2026 150,000 — N/A N/A N/A Total borrowings of Consolidated Funds $ 99,240 $ 121,909 (1) The fair values of the borrowings approximate the carrying value as the interest rate on the borrowings is a floating rate. (2) On July 23, 2021, the credit facility was terminated at the Consolidated Fund’s discretion. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 9. COMMITMENTS AND CONTINGENCIES Indemnification Arrangements Consistent with standard business practices in the normal course of business, the Company enters into contracts that contain indemnities for affiliates of the Company, persons acting on behalf of the Company or such affiliates and third parties. The terms of the indemnities vary from contract to contract and the Company’s maximum exposure under these arrangements cannot be determined and has not been recorded in the Condensed Consolidated Statements of Financial Condition. As of September 30, 2021, the Company has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote. Commitments As of September 30, 2021 and December 31, 2020, the Company had aggregate unfunded commitments to invest in funds it manages or to support certain strategic initiatives of $732.8 million and $784.2 million, respectively. Contingent Liabilities In connection with the Landmark Acquisition, the Company established a management incentive program (the “Landmark MIP”) with certain professionals of Landmark. The Landmark MIP represents a contingent liability not to exceed $300.0 million and is based on the achievement of fundraising targets for certain Landmark funds during a measurement period. The Company expects to settle this liability with a combination of 15% cash and 85% equity awards. Expense associated with the cash component is recognized ratably over the measurement period, which will end on the earlier of the final fundraising date or December 31, 2022. Expense associated with the equity component is recognized ratably over the service period, which will continue for four years beyond the measurement period end date. The Landmark MIP is remeasured each period with incremental changes in fair value included within compensation and benefits expense within the Condensed Consolidated Statements of Operations. At the measurement period end date, the cash component will be paid and restricted units for the balance of the Landmark MIP will be granted at fair value. The unpaid liability at the measurement period end date will be reclassified from liability to additional paid-in-capital and any difference between the fair value of the Landmark MIP at the measurement period end date and the previously recorded compensation expense will be recognized over the remaining four year service period as equity-based compensation expense. As of September 30, 2021, the fair value of the contingent liability was estimated to be $236.0 million. Compensation expense of $14.7 million and $19.3 million for the three months ended September 30, 2021 and for the period from June 2, 2021 through September 30, 2021, respectively, was recorded in the Condensed Consolidated Statements of Operations. The purchase agreement with Black Creek contains provisions obligating the Company to make payments in an aggregate amount not to exceed $275.0 million to certain senior professionals and advisors upon the achievement of certain revenue targets through a measurement period no later than December 31, 2024. Because these future payments require continued service through the measurement period, this consideration is accounted for as compensation expense instead of as purchase consideration. The fair value of this contingent liability is remeasured at each reporting date with compensation expense recorded ratably over the service period, which is the Black Creek Acquisition date through the measurement period end date. As of September 30, 2021, the fair value of the contingent liability was $206.7 million and the Company recorded a contingent liability of $13.5 million within accrued compensation in the Consolidated Statements of Financial Condition. For the three months ended September 30 2021, compensation expense of $13.5 million was recorded within compensation and benefits expense within the Condensed Consolidated Statements of Operations. The purchase agreement with Black Creek also contains a provision obligating the Company to make a payment to the sellers equal to 50% of the performance income realized for certain Black Creek funds for the year ended December 31, 2021. The fair value of this contingent obligation as of the acquisition date was $28.6 million. The contingent obligation is subject to remeasurement until settlement and changes in fair value from the acquisition date are recorded within other income (expense), net within the Condensed Consolidated Statements of Operations. As of September 30, 2021, the fair value of the contingent obligation was $32.8 million and recorded within due to affiliates within the Consolidated Statements of Financial Condition. Performance Income Performance income is affected by changes in the fair values of the underlying investments in the funds that are advised by the Company. Valuations, on an unrealized basis, can be significantly affected by a variety of external factors including, but not limited to, public equity market volatility, industry trading multiples and interest rates. Generally, if at the termination of a fund (and increasingly at interim points in the life of a fund), the fund has not achieved investment returns that (in most cases) exceed the preferred return threshold or (in all cases) the general partner receives net profits over the life of the fund in excess of its allocable share under the applicable partnership agreement, the Company will be obligated to repay carried interest that was received by the Company in excess of the amounts to which the Company is entitled. This contingent obligation is normally reduced by income taxes paid by the Company related to its carried interest. Senior professionals of the Company who have received carried interest distributions are responsible for funding their proportionate share of any contingent repayment obligations. However, the governing agreements of certain of the Company's funds provide that if a current or former professional does not fund his or her respective share for such fund, then the Company may have to fund additional amounts beyond what was received in carried interest, although the Company will generally retain the right to pursue any remedies under such governing agreements against those carried interest recipients who fail to fund their obligations. Additionally, at the end of the life of the funds there could be a payment due to a fund by the Company if the Company has recognized more performance income than was ultimately earned. The general partner obligation amount, if any, will depend on final realized values of investments at the end of the life of the fund. At September 30, 2021 and December 31, 2020, if the Company assumed all existing investments were worthless, the amount of performance income subject to potential repayment, net of tax distributions, which may differ from the recognition of revenue, would have been approximately $202.3 million and $326.4 million, respectively, of which approximately $158.0 million and $252.4 million, respectively, is reimbursable to the Company by certain professionals who are the recipients of such performance income. Management believes the possibility of all of the investments becoming worthless is remote. As of September 30, 2021 and December 31, 2020, if the funds were liquidated at their fair values, there would be no contingent repayment obligation or liability. Litigation From time to time, the Company is named as a defendant in legal actions relating to transactions conducted in the ordinary course of business. Although there can be no assurance of the outcome of such legal actions, in the opinion of management, the Company does not have a potential liability related to any current legal proceeding or claim that would individually or in the aggregate materially affect its results of operations, financial condition or cash flows. Leases The Company leases office space and certain office equipment. The Company's leases have remaining lease terms of one As of September 30, As of December 31, Classification 2021 2020 Operating lease assets Right-of-use operating lease assets $ 176,511 $ 154,742 Finance lease assets Other assets (1) 1,164 1,386 Total lease assets $ 177,675 $ 156,128 Operating lease liabilities Operating lease liabilities $ 214,681 $ 180,236 Finance lease obligations Accounts payable, accrued expenses and other liabilities 977 1,273 Total lease liabilities $ 215,658 $ 181,509 (1) Finance lease assets are recorded net of accumulated amortization of $1.4 million and $1.0 million as of September 30, 2021 and December 31, 2020, respectively. Maturity of lease liabilities Operating Leases Finance Leases 2021 $ 10,591 $ 73 2022 41,989 598 2023 38,277 164 2024 36,579 162 2025 36,251 11 After 2025 66,683 — Total future payments 230,370 1,008 Less: interest 15,689 31 Total lease liabilities $ 214,681 $ 977 Three months ended September 30, Nine months ended September 30, Classification 2021 2020 2021 2020 Operating lease expense General, administrative and other expenses $ 9,697 $ 7,701 $ 27,203 $ 23,138 Finance lease expense: Amortization of finance lease assets General, administrative and other expenses 154 127 408 346 Interest on finance lease liabilities Interest expense 7 11 24 33 Total lease expense $ 9,858 $ 7,839 $ 27,635 $ 23,517 Nine months ended September 30, Other information 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 26,704 $ 23,098 Operating cash flows for finance leases 34 48 Financing cash flows for finance leases 463 412 Leased assets obtained in exchange for new finance lease liabilities 189 — Leased assets obtained in exchange for new operating lease liabilities 55,461 12,477 As of September 30, As of December 31, Lease term and discount rate 2021 2020 Weighted-average remaining lease terms (in years): Operating leases 6.1 6.0 Finance leases 2.1 2.6 Weighted-average discount rate: Operating leases 2.97 % 3.59 % Finance leases 2.91 % 3.26 % |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 10. RELATED PARTY TRANSACTIONS Substantially all of the Company’s revenue is earned from its affiliates, including management fees, carried interest allocation, incentive fees, principal investment income and administrative expense reimbursements. The related accounts receivable are included within due from affiliates within the Condensed Consolidated Statements of Financial Condition, except that accrued carried interest allocations, which is predominantly due from affiliated funds, is presented separately within investments in the Condensed Consolidated Statements of Financial Condition. The Company has investment management agreements with the Ares Funds that it manages. In accordance with these agreements, these Ares Funds may bear certain operating costs and expenses which are initially paid by the Company and subsequently reimbursed by the Ares Funds. The Company also has entered into agreements to be reimbursed for its expenses incurred for providing administrative services to certain related parties, including ARCC, ACRE, ARDC, Ivy Hill Asset Management, L.P., ACF FinCo I L.P. and CION Ares Diversified Credit Fund. As a result of the Black Creek Acquisition, the Company is party to agreements with each Black Creek fund to provide various services, such as administration, acquisition, development and property management, among others. Employees and other related parties may be permitted to participate in co-investment vehicles that generally invest in Ares funds alongside fund investors. Participation is limited by law to individuals who qualify under applicable securities laws. These co-investment vehicles generally do not require these individuals to pay management fees or performance income. Performance income from the funds can be distributed to professionals or their related entities on a current basis, subject, in the case of carried interest programs, to repayment by the subsidiary of the Company that acts as general partner of the relevant fund in the event that certain specified return thresholds are not ultimately achieved. The professionals have personally guaranteed, subject to certain limitations, the obligations of these subsidiaries in respect of this general partner obligation. Such guarantees are several, and not joint, and are limited to distributions received by the relevant recipient. The Company considers its professionals and non-consolidated funds to be affiliates. Amounts due from and to affiliates were composed of the following: As of September 30, As of December 31, 2021 2020 Due from affiliates: Management fees receivable from non-consolidated funds $ 347,078 $ 308,581 Incentive fee receivable from non-consolidated funds 579 21,495 Payments made on behalf of and amounts due from non-consolidated funds and employees 145,754 75,811 Due from affiliates—Company $ 493,411 $ 405,887 Amounts due from portfolio companies and non-consolidated funds $ 9,059 $ 17,172 Due from affiliates—Consolidated Funds $ 9,059 $ 17,172 Due to affiliates: Management fee received in advance and rebates payable to non-consolidated funds $ 7,959 $ 4,808 Tax receivable agreement liability 97,698 62,505 Undistributed carried interest and incentive fees 64,675 27,322 Payments made by non-consolidated funds on behalf of and payable by the Company 32,106 5,551 Due to affiliates—Company $ 202,438 $ 100,186 Due from Ares Funds and Portfolio Companies In the normal course of business, the Company pays certain expenses on behalf of Consolidated Funds and non-consolidated funds for which it is reimbursed. Amounts advanced on behalf of Consolidated Funds are eliminated in consolidation. Certain expenses initially paid by the Company, primarily professional services, travel and other costs associated with particular portfolio company holdings, are subject to reimbursement by the portfolio companies. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 11. INCOME TAXES The Company’s income tax provision includes corporate income taxes and other entity level income taxes, as well as income taxes incurred by certain affiliated funds that are consolidated in these financial statements. For the three and nine months ended September 30, 2021, the Company recorded income tax expense of $30.3 million and $104.5 million. For the three and nine months ended September 30, 2020, the Company recorded income tax expense of $18.3 million and $22.1 million, respectively. The Company’s effective income tax rate is dependent on many factors, including the estimated nature and amounts of income and expenses allocated to the non-controlling interests without being subject to federal, state and local income taxes at the corporate level. Additionally, the Company’s effective tax rate is influenced by the amount of income tax provision recorded for any affiliated funds and co-investment entities that are consolidated in the Company's condensed consolidated financial statements. For the three and nine months ended September 30, 2021 and 2020, the Company recorded its interim income tax provision utilizing the estimated annual effective tax rate. The income tax effects of temporary differences give rise to significant portions of deferred tax assets and liabilities, which are presented on a net basis. As of September 30, 2021 and December 31, 2020, the Company recorded a net deferred tax asset of $29.9 million and $70.0 million, respectively, within other assets in the Condensed Consolidated Statements of Financial Condition. The Company files its tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by U.S. federal, state, local and foreign tax authorities. With limited exceptions, the Company is no longer subject to income tax audits by taxing authorities for any years prior to 2017. Although the outcome of tax audits is always uncertain, the Company does not believe the outcome of any future audit will have a material adverse effect on the Company’s condensed consolidated financial statements. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | 12. EARNINGS PER SHARE For the three and nine months ended September 30, 2021, the Company had Class A and non-voting common stock outstanding. The non-voting common stock has the same economic rights as the Class A common stock; therefore, earnings per share is presented on a combined basis. Income of the Company has been allocated on a proportionate basis to the two common stock classes. Additional information on the issuance of the non-voting common stock is discussed in “Note 14. Equity and Redeemable Interests.” Basic earnings per share of Class A and non-voting common stock is computed by using the two-class method. Diluted earnings per share of Class A and non-voting common stock is computed using the more dilutive method of either the two-class method or the treasury stock method. For the three and nine months ended September 30, 2021 and the three months ended September 30, 2020, the treasury stock method was the more dilutive method. For the nine months ended September 30, 2020, the two-class method was the more dilutive method. The computation of diluted earnings per share for the three and nine months ended September 30, 2021 and 2020 excludes the following restricted units and AOG units, as their effect would have been anti-dilutive: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Restricted units 450 572 167 — AOG Units 119,855,724 114,726,173 115,394,058 — The following table presents the computation of basic and diluted earnings per common share: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Basic earnings per share of Class A and non-voting common stock: Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 84,726 $ 42,120 $ 262,659 $ 56,605 Distributions on unvested restricted units (1,440) (2,757) (8,142) (7,715) Undistributed earnings allocable to participating unvested restricted units (306) — (2,858) — Net income available to Class A and non-voting common stockholders $ 82,980 $ 39,363 $ 251,659 $ 48,890 Basic weighted-average shares of Class A and non-voting common stock 168,931,621 143,466,209 161,071,151 131,866,471 Basic earnings per share of Class A and non-voting common stock $ 0.49 $ 0.27 $ 1.55 $ 0.37 Diluted earnings per share of Class A and non-voting common stock: Net income available to Class A and non-voting common stockholders $ 84,726 $ 42,120 $ 262,659 $ 56,605 Distributions on unvested restricted units — — — (7,715) Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 84,726 $ 42,120 $ 262,659 $ 48,890 Effect of dilutive shares: Restricted units 12,273,068 9,762,645 10,807,242 — Options 5,317,468 4,893,709 5,265,045 — Diluted weighted-average shares of Class A and non-voting common stock 186,522,157 158,122,563 177,143,438 131,866,471 Diluted earnings per share of Class A and non-voting common stock $ 0.45 $ 0.27 $ 1.48 $ 0.37 Dividend declared and paid per Class A and non-voting common stock $ 0.47 $ 0.40 $ 1.41 $ 1.20 |
EQUITY COMPENSATION
EQUITY COMPENSATION | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
EQUITY COMPENSATION | 13. EQUITY COMPENSATION Equity Incentive Plan Equity-based compensation is granted under the Company's 2014 Equity Incentive Plan (as amended, the "Equity Incentive Plan"). The total number of shares available to be issued under the Equity Incentive Plan resets based on a formula defined in the Equity Incentive Plan and may increase on January 1 of each year. On January 1, 2021, the total number of shares available for issuance under the Equity Incentive Plan reset to 44,510,451 shares and as of September 30, 2021, 38,972,964 shares remain available for issuance. Generally, unvested restricted units are forfeited upon termination of employment in accordance with the Equity Incentive Plan. The Company recognizes forfeitures as a reversal of previously recognized compensation expense in the period the forfeiture occurs. Equity-based compensation expense, net of forfeitures, recorded by the Company is included in the following table: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Restricted units $ 36,390 $ 30,036 $ 127,219 $ 86,804 Restricted units with a market condition 29,601 300 63,925 4,729 Options — — — 43 Equity-based compensation expense $ 65,991 $ 30,336 $ 191,144 $ 91,576 Restricted Units Each restricted unit represents an unfunded, unsecured right of the holder to receive a share of the Company's Class A common stock on a specific date. The restricted units generally vest and are settled in shares of Class A common stock either (i) at a rate of one-third per year, beginning on the third anniversary of the grant date, (ii) in their entirety on the fifth anniversary of the grant date, (iii) at a rate of one quarter per year, beginning on the second anniversary of the grant date or the holder's employment commencement date, or (iv) at a rate of one third per year, beginning on the first anniversary of the grant date in each case generally subject to the holder’s continued employment as of the applicable vesting date (subject to accelerated vesting upon certain qualifying terminations of employment or retirement eligibility provisions). Compensation expense associated with restricted units is recognized on a straight-line basis over the requisite service period of the award. Restricted units are delivered net of the holder's payroll related taxes upon vesting. For the nine months ended September 30, 2021, 8.2 million restricted units vested and 4.4 million shares of Class A common stock were delivered to the holders. For the nine months ended September 30, 2020, 4.7 million restricted units vested and 2.6 million shares of Class A common stock were delivered to the holders. The holders of restricted units, other than awards that have not yet been issued as described in the subsequent sections, generally have the right to receive as current compensation an amount in cash equal to (i) the amount of any dividend paid with respect to a share of Class A common stock multiplied by (ii) the number of restricted units held at the time such dividends are declared (“Dividend Equivalent”). During the nine months ended September 30, 2021, the Company declared dividends of $0.47 per share to Class A common stockholders at the close of business on March 17, 2021, June 16, 2021 and September 16, 2021. For the three and nine months ended September 30, 2021, Dividend Equivalents were made to the holders of restricted units in the aggregate amount of $6.4 million and $21.7 million, respectively, which are presented as dividends within the Condensed Consolidated Statements of Changes in Equity. When units are forfeited, the cumulative amount of Dividend Equivalents previously paid is reclassified to compensation and benefits expense in the Condensed Consolidated Statements of Operations. During the first quarter of 2021, in addition to grants awarded in 2021, the Company approved the future grant of restricted units to certain senior executives in each of 2022, 2023 and 2024, subject to the holder’s continued employment and acceleration in certain instances. The vesting period of these awards are at a rate of 25% per year, beginning on the second anniversary of the grant date. Given that these future restricted units have been communicated to the recipient, the Company accounts for these awards as if they have been granted and recognizes the compensation expense on a straight-line basis over the service period. The restricted units that have been approved and communicated but not yet granted are not eligible to receive a Dividend Equivalent until the grant date. The following table presents unvested restricted units' activity: Restricted Units Weighted Average Balance - January 1, 2021 16,299,664 $ 24.30 Granted 9,667,989 46.16 Vested (6,278,948) 20.70 Forfeited (1,255,502) 30.48 Balance - September 30, 2021 18,433,203 $ 36.33 The total compensation expense expected to be recognized in all future periods associated with the restricted units is approximately $504.8 million as of September 30, 2021 and is expected to be recognized over the remaining weighted average period of 3.5 years. Performance-Based Restricted Unit Awards with a Market Condition During the first quarter of 2021, the Company granted certain restricted units with a vesting condition contingent upon the volume-weighted, average closing price of the Company’s Class A common stock meeting or exceeding a stated price for 30 consecutive calendar days on or prior to January 22, 2029, referred to as the market condition. 537,500 restricted units with a market condition of $55.00 per share (“Tranche I”), 537,500 restricted units with a market condition of $60.00 per share (“Tranche II”), 537,500 restricted units with a market condition of $65.00 per share (“Tranche III”) and 537,500 restricted units with a market condition of $75.00 per share (“Tranche IV”) were granted. Vesting is also generally subject to continued employment at the time such market condition is achieved, subject to certain exceptions upon certain qualifying terminations of employment. Under the terms of the awards, if the target price of the applicable market condition is not achieved by the close of business on January 22, 2029, the unvested market condition awards will be automatically canceled and forfeited for no consideration. Restricted units subject to a market condition are not eligible to receive a Dividend Equivalent. The grant date fair values for Tranche I, Tranche II, Tranche III and Tranche IV awards were $37.28, $34.47, $31.92 and $27.75 per unit, respectively, based on a probability distributed Monte-Carlo simulation. Due to the existence of the market condition, the vesting period for the awards is not explicit, and as such, compensation expense is recognized on a straight-line basis over the median vesting period derived from the positive iterations of the Monte Carlo simulation where the market condition was achieved. The median vesting period is 0.7 years, 1.2 years, 1.6 years and 2.3 years for Tranche I, Tranche II, Tranche III and Tranche IV, respectively. Below is a summary of the significant assumptions used to estimate the grant date fair value of market condition awards: Closing price of the Company's common shares as of valuation date $45.76 Risk-free interest rate 0.88% Volatility 35.0% Dividend yield 3.5% Cost of equity 10.0% The following table presents the market condition awards' activity: Market Condition Awards Units Weighted Average Balance - January 1, 2021 — $ — Granted 2,150,000 32.86 Vested (1,925,000) 33.21 Forfeited (225,000) 29.84 Balance - September 30, 2021 — $ — During the nine months ended September 30, 2021, the market-priced vesting condition was met for all four tranches of the market condition awards and resulted in the acceleration of $43.4 million of compensation expense. Tranche I was met during the second quarter of 2021 and Tranche II, III and IV were met during the third quarter of 2021, and the compensation expense was accelerated during each of the quarters of $14.0 million and $29.4 million, respectively. Options A summary of options activity during the nine months ended September 30, 2021 is presented below: Options Weighted Average Exercise Price Weighted Average Aggregate Intrinsic Value Balance - January 1, 2021 8,312,203 $ 18.99 3.4 $ 233,251 Granted — — — — Exercised (1,489,789) 18.94 — — Expired — — — — Forfeited — — — — Balance - September 30, 2021 6,822,414 $ 19.00 2.6 $ 374,073 Exercisable at September 30, 2021 6,822,414 $ 19.00 2.6 $ 374,073 |
EQUITY AND REDEEMABLE INTEREST
EQUITY AND REDEEMABLE INTEREST | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
EQUITY AND REDEEMABLE INTEREST | 14. EQUITY AND REDEEMABLE INTEREST Common Stock The Company's common stock consists of Class A, Class B, Class C and non-voting common stock, each $0.01 par value per share. The non-voting common stock has the same economic rights as the Class A common stock. Sumitomo Mitsui Banking Corporation (“SMBC”) is the sole holder of the non-voting common stock. The Class B common stock and Class C common stock are non-economic and holders are not entitled to dividends from the Company or to receive any assets of the Company in the event of any dissolution, liquidation or winding up of the Company. Ares Management GP LLC is the sole holder of the Class B common stock and Ares Voting LLC (“Ares Voting”) is the sole holder of the Class C common stock. In February 2021, the Company's board of directors authorized the renewal of the stock repurchase program that allows for the repurchase of up to $150 million of shares of Class A common stock. Under the program, shares may be repurchased from time to time in open market purchases, privately negotiated transactions or otherwise, including in reliance on Rule 10b5-1 of the Securities Act. The program is scheduled to expire in February 2022. Repurchases under the program, if any, will depend on the prevailing market conditions and other factors. During the nine months ended September 30, 2021 and 2020, the Company did not repurchase any shares as part of the stock repurchase program. On April 5, 2021, the Company entered into a Share Purchase Agreement (the “Purchase Agreement”) with SMBC. Pursuant to the Purchase Agreement, the Company agreed to issue and sell to SMBC approximately $250.0 million of the Company’s common stock (consisting of 3,489,911 shares of non-voting common stock and 1,234,200 shares of Class A common stock) at a price per share equal to the public offering price of Class A common stock being offered pursuant to the Offering (as defined below), less underwriting discounts and commissions (the “Private Placement”). The Private Placement closed on April 8, 2021 and resulted in gross proceeds to the Company of approximately $250.0 million before deducting offering expenses. On April 6, 2021, the Company entered into an underwriting agreement pursuant to which the Company agreed to issue and sell 10,925,000 shares of the Class A common stock (including 1,425,000 shares of Class A common stock sold pursuant to the exercise of the underwriters' option to purchase additional shares of Class A common stock) (collectively, the “Offering”). The Offering closed on April 8, 2021 and resulted in gross proceeds to the Company of approximately $578.2 million before deducting offering expenses. Offering expenses for the Private Placement and Offering amounted to approximately $0.7 million. The expenses have been recorded as a reduction in the proceeds received and are presented on a net basis together with issuances of common stock in additional paid-in-capital within the Condensed Consolidated Statements of Changes in Equity. The following table presents the changes in each class of common stock: Class A Common Stock Non-Voting Common Stock Class B Common Stock Class C Common Stock Total Balance - January 1, 2021 147,182,562 — 1,000 112,447,618 259,631,180 Issuance of stock (1) 12,159,200 3,489,911 — 8,744,296 24,393,407 Exchanges of AOG Units 2,330,367 — — (2,330,367) — Redemptions of AOG Units — — — (58,290) (58,290) Stock option exercises, net of shares withheld for tax 1,460,388 — — — 1,460,388 Vesting of restricted stock awards, net of shares withheld for tax 4,448,648 — — — 4,448,648 Balance - September 30, 2021 167,581,165 3,489,911 1,000 118,803,257 289,875,333 (1) Issuances of Class C Common stock corresponds with increases in Ares Owners Holdings L.P.’s ownership interest in the AOG entities. The following table presents each partner's AOG Units and corresponding ownership interest in each of the Ares Operating Group entities, as well as its daily average ownership of AOG Units in each of the Ares Operating Group entities: Daily Average Ownership As of September 30, 2021 As of December 31, 2020 Three months ended September 30, Nine months ended September 30, AOG Units Direct Ownership Interest AOG Units Direct Ownership Interest 2021 2020 2021 2020 Ares Management Corporation 171,071,076 59.02 % 147,182,562 56.69 % 58.50 % 55.57 % 58.26 % 53.33 % Ares Owners Holdings, L.P. 118,803,257 40.98 112,447,618 43.31 41.50 44.43 41.74 46.67 Total 289,874,333 100.00 % 259,630,180 100.00 % Preferred Stock As of December 31, 2020, the Company had 12,400,000 shares of the Series A Preferred Stock outstanding. As and if declared by the Company’s board of directors, dividends on the Series A Preferred Stock are payable quarterly at a rate per annum equal to 7.00%. The Series A Preferred Stock could be redeemed at the Company’s option, in whole or in part, at any time on or after June 30, 2021, at a price per share of $25.00. On June 30, 2021 (the “Redemption Date”), the Company redeemed all shares of the Series A Preferred Stock outstanding at a redemption price per share of $25.00. The redemption price did not include any accrued dividends as the Redemption Date occurred on the dividend payment date. On the Redemption Date, the Company paid $310.0 million for the redemption of the Series A Preferred Stock and $5.4 million for the previously announced dividend of $0.4375 per share. The excess of the redemption price over the carrying value of the Series A Preferred Stock of approximately $11.2 million relates to the original issuance costs and is presented as a reduction to net income available to common stockholders and to non-controlling interests in AOG entities within the Condensed Consolidated Statements of Operations. Redeemable Interest The following table summarizes the activities associated with the redeemable interest in Ares Operating Group entities: Total Balance - January 1, 2021 $ 100,366 Net income 32 Currency translation adjustment, net of tax (590) Balance- March 31, 2021 $ 99,808 Net income $ 337 Currency translation adjustment, net of tax 186 Distribution (300) Balance- June 30, 2021 $ 100,031 Net income $ 324 Currency translation adjustment, net of tax (356) Distribution (1,350) Balance- September 30, 2021 $ 98,649 The following table summarizes the activities associated with the redeemable interest in Consolidated Funds: Total Balance - January 1, 2021 $ — Redemption value 930,924 Balance- March 31, 2021 $ 930,924 Change in redemption value (14,100) Balance- June 30, 2021 $ 916,824 Change in redemption value 83,176 Balance- September 30, 2021 $ 1,000,000 |
SEGMENT REPORTING
SEGMENT REPORTING | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | 15. SEGMENT REPORTING The Company operates through its distinct operating segments that are summarized below: Credit Group: The Credit Group manages credit strategies across the liquid and illiquid spectrum, including syndicated loans, high yield bonds, multi-asset credit, alternative credit investments and direct lending. The syndicated loans strategy focuses on evaluating individual credit opportunities related primarily to non-investment grade senior secured loans and primarily targets first lien secured debt, with a secondary focus on second lien secured loans and subordinated and other unsecured loans. The high yield bond strategy seeks to deliver a diversified portfolio of liquid, traded non-investment grade corporate bonds, including secured, unsecured and subordinated debt instruments. Multi-asset credit is a “go anywhere” strategy designed to offer investors a flexible solution to global credit investing by allowing us to tactically allocate between multiple asset classes in various market conditions. The alternative credit strategy seeks to capitalize on asset-focused investment opportunities that fall outside of traditional, well-defined markets such as corporate debt, real estate and private equity. The alternative credit strategy emphasizes downside protection and capital preservation through a focus on investments that tend to share the following key attributes: asset security, covenants, structural protections and cash flow velocity. The direct lending strategy is one of the largest self-originating direct lenders to the U.S. and European markets and has a multi-channel origination strategy designed to address a broad set of investment opportunities in the middle market. The direct lending team maintains a flexible investment strategy with the capability to invest in first lien senior secured loans (including “unitranche” loans which are loans that combine senior and subordinated debt, generally in a first lien position), second lien senior secured loans, subordinated debt, preferred equity and non-control equity co-investments in private middle market companies. U.S. direct lending activities are managed through a publicly traded business development company, ARCC, as well as through private commingled funds and separately managed accounts (“SMAs”). Private Equity Group: The Private Equity Group manages investment strategies broadly categorizes its investment activities into three strategies: Corporate Private Equity, Special Opportunities and Infrastructure and Power. In the Corporate Private Equity strategy, the Company targets four principal transactions types: prudently leveraged control buyouts, growth equity, rescue/deleveraging capital and distressed buyouts/discounted debt accumulation together with the broad resources of potential investment opportunities. This flexible capital approach, together with the broad resources of the Ares platform, widens our universe of potential investment opportunities and allows us to remain active in different markets and to be highly selective in making investments across various market environments. In the Special Opportunities strategy, the Company employs a flexible capital strategy to target non-control positions across a broad spectrum of stressed, distressed and opportunistic situations. The Infrastructure and Power strategy targets value-added approach that seeks to source and structure essential infrastructure assets with strong downside protection and potential for capital appreciation throughout the climate infrastructure, natural gas generation, and energy transportation sectors. Real Estate Group : The Real Estate Group manages comprehensive real estate equity and debt strategies, focusing on activities categorized as core, value-add, and opportunistic. Real Estate equity strategies involve high-quality properties and locations and de-risked developments with an opportunity to create value through repositioning, lease-up, re-tenanting, redevelopment, and/or complex recapitalizations. The group targets assets located in liquid markets with diversified economies in order to deliver compelling, risk-adjusted returns through a combination of asset selectivity and disciplined portfolio management. The U.S. core investment activities focus on the acquisition of assets secured by long-term cash flows and durable tenancy diversified across geographies and end-user industries. The core strategy encompasses industrial, multifamily, office, necessity-based retail, and other property types across major metropolitan economies. The value-add investment activities focus on acquiring underperforming, income-producing, institutional-quality assets that can be improved through select value-creation initiatives across the U.S. and Europe. The opportunistic activities focus on capitalizing on distressed and special situations, repositioning underperforming assets and undertaking select development and redevelopment projects across the U.S. and Europe. Additionally, the Ares Real Estate Group has specialized operating and investment capabilities specifically in the industrial sector through its vertically integrated operating platform. The Company’s debt strategies leverage the Real Estate Group’s diverse sources of capital to directly originate and invest in a wide range of financing opportunities in the U.S. In addition to managing private commingled funds and SMAs investing in equity and debt strategies, the Real Estate Group also makes investments through Black Creek Diversified Property Fund, Inc. (“DPF”) and Black Creek Industrial REIT IV, Inc. (“BCI IV”), its non-traded REITs, and ACRE, a publicly traded commercial mortgage REIT. Secondary Solutions Group : The Secondary Solutions Group was formed during the second quarter of 2021 in connection with the Landmark Acquisition. The Secondary Solutions Group invests in secondary markets across a range of alternative asset class strategies, including private equity, real estate and infrastructure. The Company acquires interests across a range of partnership vehicles, including funds, multi-asset portfolios and single asset joint ventures. Each strategy focuses on recapitalizing and restructuring the funds, including transactions that can address pending fund maturity, strategy change or the need for additional equity capital. The private equity secondaries strategy targets opportunities in non-competitive channels and makes investments in durable, performing assets with attractive capital structures. In the real estate secondaries strategy, the Company seeks broad diversification by property sector and geography and to drive investment results through underwriting, transaction structuring and portfolio construction. In the infrastructure secondaries strategy, the Company focuses on achieving diversification through a portfolio that provides inflation protection and exposure to uncorrelated assets. Strategic Initiatives: The Company began reflecting the Strategic Initiatives category beginning in the third quarter of 2020. It represents an all other category that includes operating segments and strategic investments that seek to expand the Company’s reach and its scale in new and existing global markets including Ares SSG, Ares Insurance Solutions (“AIS”) and AAC. The OMG consists of shared resource groups to support the Company’s operating segments by providing infrastructure and administrative support in the areas of accounting/finance, operations, information technology, legal, compliance, human resources, strategy, relationship management and distribution. The OMG includes Ares Wealth Management Solutions (“WMS”) that facilitates the product development, distribution, marketing and client management activities for investment offerings in the global wealth management channel. Additionally, the OMG provides services to certain of the Company’s investment companies and partnerships, which reimburse the OMG for expenses equal to the costs of services provided. The OMG’s revenues and expenses are not allocated to the Company’s reportable segments but the Company does consider the cost structure of the OMG when evaluating its financial performance. Segment Profit Measures: These measures supplement and should be considered in addition to, and not in lieu of, the Condensed Consolidated Statements of Operations prepared in accordance with GAAP. Fee related earnings (“FRE”) is used to assess core operating performance by determining whether recurring revenue, primarily consisting of management fees, is sufficient to cover operating expenses and to generate profits. FRE differs from income before taxes computed in accordance with GAAP as it excludes performance income, performance related compensation, investment income from the Consolidated Funds and non-consolidated funds and certain other items that the Company believes are not indicative of its core operating performance. Realized income (“RI”) is an operating metric used by management to evaluate performance of the business based on operating performance and the contribution of each of the business segments to that performance, while removing the fluctuations of unrealized income and expenses, which may or may not be eventually realized at the levels presented and whose realizations depend more on future outcomes than current business operations. RI differs from income before taxes by excluding (a) operating results of the Consolidated Funds, (b) depreciation and amortization expense, (c) the effects of changes arising from corporate actions, (d) unrealized gains and losses related to performance income and investment performance and (e) certain other items that the Company believes are not indicative of operating performance. Changes arising from corporate actions include equity-based compensation expenses, the amortization of intangible assets, transaction costs associated with mergers, acquisitions and capital activities, underwriting costs and expenses incurred in connection with corporate reorganization. Management believes RI is a more appropriate metric to evaluate the Company's current business operations. Management makes operating decisions and assesses the performance of each of the Company’s business segments based on financial and operating metrics and other data that is presented before giving effect to the consolidation of any of the Consolidated Funds. Consequently, all segment data excludes the assets, liabilities and operating results related to the Consolidated Funds and non-consolidated funds. The following tables present the financial results for the Company’s operating segments, as well as the OMG: Three months ended September 30, 2021 Credit Group Private Equity Group Real Secondary Solutions Group Strategic Initiatives Total OMG Total Management fees $ 271,591 $ 69,591 $ 55,160 $ 41,064 16,544 $ 453,950 $ — $ 453,950 Other fees 5,798 370 3,681 — 2 9,851 3,446 13,297 Compensation and benefits (86,502) (26,773) (29,160) (11,955) (5,316) (159,706) (66,107) (225,813) General, administrative and other expenses (14,930) (6,238) (5,420) (2,593) (1,774) (30,955) (28,142) (59,097) Fee related earnings 175,957 36,950 24,261 26,516 9,456 273,140 (90,803) 182,337 Performance income—realized 6,332 34,316 4,693 — — 45,341 — 45,341 Performance related compensation—realized (3,079) (27,483) (3,166) — — (33,728) — (33,728) Realized net performance income 3,253 6,833 1,527 — — 11,613 — 11,613 Investment income—realized 618 2,020 1,699 — 1,025 5,362 — 5,362 Interest and other investment income (expense)—realized 4,716 4,861 918 699 163 11,357 (270) 11,087 Interest expense (2,392) (2,726) (1,683) (427) (4,135) (11,363) (160) (11,523) Realized net investment income (loss) 2,942 4,155 934 272 (2,947) 5,356 (430) 4,926 Realized income $ 182,152 $ 47,938 $ 26,722 $ 26,788 $ 6,509 $ 290,109 $ (91,233) $ 198,876 Three months ended September 30, 2020 Credit Group Private Equity Group Real Secondary Solutions Group Strategic Initiatives Total OMG Total Management fees $ 208,371 $ 54,653 $ 23,787 $ — $ 13,320 $ 300,131 $ — $ 300,131 Other fees 4,898 2 5 — 6 4,911 — 4,911 Compensation and benefits (74,373) (21,224) (13,011) — (4,241) (112,849) (41,551) (154,400) General, administrative and other expenses (13,789) (6,002) (2,987) — (1,514) (24,292) (19,519) (43,811) Fee related earnings 125,107 27,429 7,794 — 7,571 167,901 (61,070) 106,831 Performance income—realized 7,069 115,997 199 — — 123,265 — 123,265 Performance related compensation—realized (4,131) (93,284) (123) — — (97,538) — (97,538) Realized net performance income 2,938 22,713 76 — — 25,727 — 25,727 Investment income—realized — 16,351 486 — — 16,837 — 16,837 Interest and other investment income (expense)—realized 1,962 1,065 1,308 — (4) 4,331 (503) 3,828 Interest expense (2,340) (2,216) (1,389) — (729) (6,674) (141) (6,815) Realized net investment income (loss) (378) 15,200 405 — (733) 14,494 (644) 13,850 Realized income $ 127,667 $ 65,342 $ 8,275 $ — $ 6,838 $ 208,122 $ (61,714) $ 146,408 Nine months ended September 30, 2021 Credit Group Private Equity Group Real Secondary Solutions Group Strategic Initiatives Total OMG Total Management fees $ 764,702 $ 171,019 $ 115,602 $ 53,962 $ 48,963 $ 1,154,248 $ — $ 1,154,248 Other fees 18,494 726 4,604 — 82 23,906 3,446 27,352 Compensation and benefits (252,783) (73,534) (60,767) (16,244) (15,440) (418,768) (158,943) (577,711) General, administrative and other expenses (37,716) (17,499) (12,064) (3,452) (5,580) (76,311) (69,872) (146,183) Fee related earnings 492,697 80,712 47,375 34,266 28,025 683,075 (225,369) 457,706 Performance income—realized 78,255 159,479 12,255 — — 249,989 — 249,989 Performance related compensation—realized (49,433) (127,706) (8,167) — — (185,306) — (185,306) Realized net performance income 28,822 31,773 4,088 — — 64,683 — 64,683 Investment income—realized 1,858 5,308 4,182 — 1,347 12,695 — 12,695 Interest and other investment income—realized 14,354 10,716 3,892 701 2,824 32,487 170 32,657 Interest expense (5,372) (6,032) (3,930) (432) (8,962) (24,728) (397) (25,125) Realized net investment income (loss) 10,840 9,992 4,144 269 (4,791) 20,454 (227) 20,227 Realized income $ 532,359 $ 122,477 $ 55,607 $ 34,535 $ 23,234 $ 768,212 $ (225,596) $ 542,616 Nine months ended September 30, 2020 Credit Group Private Equity Group Real Estate Group Secondary Solutions Group Strategic Initiatives Total OMG Total Management fees $ 606,596 $ 160,206 $ 71,459 $ — $ 13,320 $ 851,581 $ — $ 851,581 Other fees 12,057 142 716 — 6 12,921 — 12,921 Compensation and benefits (222,063) (62,946) (38,159) — (4,241) (327,409) (114,916) (442,325) General, administrative and other expenses (41,626) (16,083) (9,185) — (1,514) (68,408) (56,877) (125,285) Fee related earnings 354,964 81,319 24,831 — 7,571 468,685 (171,793) 296,892 Performance income—realized 16,085 276,469 27,106 — — 319,660 — 319,660 Performance related compensation—realized (12,142) (222,949) (17,484) — — (252,575) — (252,575) Realized net performance income 3,943 53,520 9,622 — — 67,085 — 67,085 Investment income (loss)—realized (843) 35,866 2,740 — — 37,763 (5,698) 32,065 Interest and other investment income (expense)—realized 13,166 2,364 3,024 — (4) 18,550 (588) 17,962 Interest expense (6,391) (6,106) (3,715) — (729) (16,941) (1,262) (18,203) Realized net investment income (loss) 5,932 32,124 2,049 — (733) 39,372 (7,548) 31,824 Realized income $ 364,839 $ 166,963 $ 36,502 $ — $ 6,838 $ 575,142 $ (179,341) $ 395,801 The following table presents the components of the Company’s operating segments’ revenue, expenses and realized net investment income: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Segment revenues Management fees $ 453,950 $ 300,131 $ 1,154,248 $ 851,581 Other fees 9,851 4,911 23,906 12,921 Performance income—realized 45,341 123,265 249,989 319,660 Total segment revenues $ 509,142 $ 428,307 $ 1,428,143 $ 1,184,162 Segment expenses Compensation and benefits $ 159,706 $ 112,849 $ 418,768 $ 327,409 General, administrative and other expenses 30,955 24,292 76,311 68,408 Performance related compensation—realized 33,728 97,538 185,306 252,575 Total segment expenses $ 224,389 $ 234,679 $ 680,385 $ 648,392 Segment realized net investment income Investment income—realized $ 5,362 $ 16,837 $ 12,695 $ 37,763 Interest and other investment income —realized 11,357 4,331 32,487 18,550 Interest expense (11,363) (6,674) (24,728) (16,941) Total segment realized net investment income $ 5,356 $ 14,494 $ 20,454 $ 39,372 The following table reconciles the Company's consolidated revenues to segment revenue: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Total consolidated revenue $ 948,719 $ 489,866 $ 2,901,926 $ 1,106,033 Performance (income) loss—unrealized (415,317) (52,488) (1,381,697) 77,866 Management fees of Consolidated Funds eliminated in consolidation 11,051 11,719 33,416 33,601 Incentive fees of Consolidated Funds eliminated in consolidation — — 1,528 (70) Administrative, transaction and other fees of Consolidated Funds eliminated in consolidation 4,264 4,448 13,157 12,249 Administrative fees (1) (15,632) (9,216) (34,754) (27,715) OMG revenue (3,446) — (3,446) — Performance income (loss) reclass (2) 680 (291) 1,285 (3,664) Principal investment income, net of eliminations (14,250) (11,408) (86,477) (8,330) Net income of non-controlling interests in consolidated subsidiaries (6,927) (4,323) (16,795) (5,808) Total consolidation adjustments and reconciling items (439,577) (61,559) (1,473,783) 78,129 Total segment revenue $ 509,142 $ 428,307 $ 1,428,143 $ 1,184,162 (1) Represents administrative fees that are presented in administrative, transaction and other fees in the Company’s Condensed Consolidated Statements of Operations and are netted against the respective expenses for segment reporting. (2) Related to performance income for AREA Sponsor Holdings LLC, an investment pool. Changes in value of this investment are reflected within net realized and unrealized gains (losses) on investments in the Company’s Condensed Consolidated Statements of Operations. The following table reconciles the Company's consolidated expenses to segment expenses: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Total consolidated expenses $ 813,267 $ 392,580 $ 2,363,108 $ 958,106 Performance related compensation-unrealized (296,044) (24,818) (1,022,393) 61,010 Expenses of Consolidated Funds added in consolidation (23,206) (17,737) (66,653) (50,237) Expenses of Consolidated Funds eliminated in consolidation 11,102 11,718 35,078 33,531 Administrative fees (1) (15,632) (9,216) (34,754) (27,715) OMG expenses (94,249) (61,070) (228,815) (171,793) Acquisition and merger-related expense (754) (3,474) (18,364) (9,430) Equity compensation expense (65,991) (30,336) (191,144) (91,576) Acquisition-related compensation expense (2) (28,194) — (32,824) — Deferred placement fees (32,413) (2,942) (33,740) (18,677) Depreciation and amortization expense (36,668) (14,336) (71,742) (26,197) Expense of non-controlling interests in consolidated subsidiaries (6,829) (5,690) (17,372) (8,630) Total consolidation adjustments and reconciling items (588,878) (157,901) (1,682,723) (309,714) Total segment expenses $ 224,389 $ 234,679 $ 680,385 $ 648,392 (1) Represents administrative fees that are presented in administrative, transaction and other fees in the Company’s Condensed Consolidated Statements of Operations and are netted against the respective expenses for segment reporting. (2) Represents compensation expense associated with contingent obligations recorded in connection with the Landmark Acquisition and the Black Creek Acquisition and is presented in compensation and benefits in the Company’s Condensed Consolidated Statements of Operations. The following table reconciles the Company's consolidated other income to segment realized net investment income: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Total consolidated other income (expense) $ 111,536 $ 62,355 $ 218,011 $ (43,602) Investment (income) loss—unrealized (3,609) 1,479 (60,588) 83,369 Interest and other investment (income) loss—unrealized (1,405) (1,390) 3,057 (10,330) Other (income) loss from Consolidated Funds added in consolidation, net (76,287) (68,132) (178,195) 20,719 Other expense from Consolidated Funds eliminated in consolidation, net (4,973) (3,470) (13,783) (11,478) OMG other (income) expense 37 (1,820) 646 (781) Performance (income) loss reclass (1) (680) 291 (1,285) 3,664 Principal investment income (loss) 20,719 18,080 96,448 (24,951) Other (income) expense, net (34,812) 9,534 (34,666) 9,903 Other (income) loss of non-controlling interests in consolidated subsidiaries (5,170) (2,433) (9,191) 12,859 Total consolidation adjustments and reconciling items (106,180) (47,861) (197,557) 82,974 Total segment realized net investment income $ 5,356 $ 14,494 $ 20,454 $ 39,372 (1) Related to performance income for AREA Sponsor Holdings LLC. Changes in value of this investment are reflected within net realized and unrealized gains (losses) on investments in the Company’s Condensed Consolidated Statements of Operations. The following table presents the reconciliation of income before taxes as reported in the Condensed Consolidated Statements of Operations to segment results of RI and FRE: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Income before taxes $ 246,988 $ 159,641 $ 756,829 $ 104,325 Adjustments: Depreciation and amortization expense 36,668 14,336 71,742 26,197 Equity compensation expense 65,991 30,336 191,144 91,576 Acquisition-related compensation expense (1) 28,194 — 32,824 — Acquisition and merger-related expense 7,967 3,490 26,188 9,815 Deferred placement fees 32,413 2,942 33,740 18,677 OMG expense, net 90,840 59,250 226,015 171,012 Other (income) expense, net (42,025) 9,518 (42,490) 9,518 Net (income) expense of non-controlling interests in consolidated subsidiaries (5,268) (1,066) (8,614) 15,681 (Income) loss before taxes of non-controlling interests in Consolidated Funds, net of eliminations (47,372) (42,744) (102,331) 38,446 Total performance (income) loss—unrealized (415,317) (52,488) (1,381,697) 77,866 Total performance related compensation—unrealized 296,044 24,818 1,022,393 (61,010) Total investment (income) loss—unrealized (5,014) 89 (57,531) 73,039 Realized income 290,109 208,122 768,212 575,142 Total performance income—realized (45,341) (123,265) (249,989) (319,660) Total performance related compensation—realized 33,728 97,538 185,306 252,575 Total investment income—realized (5,356) (14,494) (20,454) (39,372) Fee related earnings $ 273,140 $ 167,901 $ 683,075 $ 468,685 (1) Represents compensation expense associated with contingent obligations recorded in connection with the Landmark Acquisition and the Black Creek Acquisition and is presented in compensation and benefits in the Company’s Condensed Consolidated Statements of Operations. |
CONSOLIDATION
CONSOLIDATION | 9 Months Ended |
Sep. 30, 2021 | |
Condensed Financial Information Disclosure [Abstract] | |
CONSOLIDATION | 16. CONSOLIDATION Investments in Consolidated Variable Interest Entities The Company consolidates entities in which the Company has a variable interest and as the general partner or investment manager, has both the power to direct the most significant activities and a potentially significant economic interest. Investments in the consolidated VIEs are reported at fair value and represent the Company’s maximum exposure to loss. Investments in Non-Consolidated Variable Interest Entities The Company holds interests in certain VIEs that are not consolidated as the Company is not the primary beneficiary. The Company's interest in such entities generally is in the form of direct equity interests, fixed fee arrangements or both. The maximum exposure to loss represents the potential loss of assets by the Company relating to these non-consolidated entities. Investments in the non-consolidated VIEs are carried at fair value. The Company's interests in consolidated and non-consolidated VIEs, as presented in the Condensed Consolidated Statements of Financial Condition, and its respective maximum exposure to loss relating to non-consolidated VIEs are as follows: As of September 30, As of December 31, 2021 2020 Maximum exposure to loss attributable to the Company's investment in non-consolidated VIEs (1) $ 340,988 $ 224,203 Maximum exposure to loss attributable to the Company's investment in consolidated VIEs (1) 478,164 391,963 Assets of consolidated VIEs 12,190,617 11,580,003 Liabilities of consolidated VIEs 11,238,928 10,716,438 (1) As of September 30, 2021 and December 31, 2020, the Company's maximum exposure of loss for CLO securities was equal to the cumulative fair value of our capital interest in CLOs that are managed and totaled $104.4 million and $107.7 million, respectively. Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Net income (loss) attributable to non-controlling interests related to consolidated VIEs $ 38,597 $ 42,627 $ 84,285 $ (38,593) Consolidating Schedules The following supplemental financial information illustrates the consolidating effects of the Consolidated Funds on the Company's financial condition, results from operations and cash flows: As of September 30, 2021 Consolidated Consolidated Eliminations Consolidated Assets Cash and cash equivalents $ 295,704 $ — $ — $ 295,704 Investments (includes $2,625,319 of accrued carried interest) 3,804,023 — (481,358) 3,322,665 Due from affiliates 517,504 — (24,093) 493,411 Other assets 1,006,870 — — 1,006,870 Intangible assets, net 1,452,690 — — 1,452,690 Right-of-use operating lease assets 176,511 — — 176,511 Assets of Consolidated Funds Cash and cash equivalents — 1,581,433 — 1,581,433 U.S. Treasury securities, at fair value — 1,000,165 — 1,000,165 Investments, at fair value — 10,356,640 4,214 10,360,854 Due from affiliates — 19,089 (10,030) 9,059 Receivable for securities sold — 187,230 — 187,230 Other assets — 47,806 — 47,806 Total assets $ 7,253,302 $ 13,192,363 $ (511,267) $ 19,934,398 Liabilities Accounts payable, accrued expenses and other liabilities $ 218,171 $ — $ (10,030) $ 208,141 Accrued compensation 309,569 — — 309,569 Due to affiliates 202,438 — — 202,438 Performance related compensation payable 1,895,343 — — 1,895,343 Debt obligations 1,238,325 — — 1,238,325 Operating lease liabilities 214,681 — — 214,681 Liabilities of Consolidated Funds Accounts payable, accrued expenses and other liabilities — 102,883 (13,198) 89,685 Due to affiliates — 19,880 (19,880) — Payable for securities purchased — 863,007 — 863,007 CLO loan obligations, at fair value — 10,220,040 (45,246) 10,174,794 Fund borrowings — 99,240 — 99,240 Total liabilities 4,078,527 11,305,050 (88,354) 15,295,223 Commitments and contingencies Redeemable interest in Consolidated Funds — 1,000,000 — 1,000,000 Redeemable interest in Ares Operating Group entities 98,649 — — 98,649 Non-controlling interest in Consolidated Funds — 887,313 (422,913) 464,400 Non-controlling interest in Ares Operating Group entities 1,322,866 — — 1,322,866 Stockholders' Equity Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (zero shares issued and outstanding) — — — — Class A common stock, $0.01 par value, 1,500,000,000 shares authorized (167,581,165 shares issued and outstanding) 1,676 — — 1,676 Non-voting common stock, $0.01 par value, 500,000,000 shares authorized (3,489,911 shares issued and outstanding) 35 — — 35 Class B common stock, $0.01 par value, 1,000 shares authorized (1,000 shares issued and outstanding) — — — — Class C common stock, $0.01 par value, 499,999,000 shares authorized (118,803,257 shares issued and outstanding) 1,188 — — 1,188 Additional paid-in-capital 1,881,913 — — 1,881,913 Retained earnings (128,981) — — (128,981) Accumulated other comprehensive loss, net of tax (2,571) — — (2,571) Total stockholders' equity 1,753,260 — — 1,753,260 Total equity 3,076,126 887,313 (422,913) 3,540,526 Total liabilities, redeemable interest, non-controlling interests and equity $ 7,253,302 $ 13,192,363 $ (511,267) $ 19,934,398 As of December 31, 2020 Consolidated Consolidated Eliminations Consolidated Assets Cash and cash equivalents $ 539,812 $ — $ — $ 539,812 Investments (includes $1,145,853 of accrued carried interest) 2,064,517 — (381,758) 1,682,759 Due from affiliates 426,021 — (20,134) 405,887 Other assets 590,543 — (211) 590,332 Intangible assets, net 222,087 — — 222,087 Right-of-use operating lease assets 154,742 — — 154,742 Assets of Consolidated Funds Cash and cash equivalents — 522,377 — 522,377 Investments, at fair value — 10,873,522 3,575 10,877,097 Due from affiliates — 27,377 (10,205) 17,172 Receivable for securities sold — 121,225 — 121,225 Other assets — 35,502 — 35,502 Total assets $ 3,997,722 $ 11,580,003 $ (408,733) $ 15,168,992 Liabilities Accounts payable, accrued expenses and other liabilities $ 125,494 $ — $ (10,205) $ 115,289 Accrued compensation 103,010 — — 103,010 Due to affiliates 100,186 — — 100,186 Performance related compensation payable 813,378 — — 813,378 Debt obligations 642,998 — — 642,998 Operating lease liabilities 180,236 — — 180,236 Liabilities of Consolidated Funds Accounts payable, accrued expenses and other liabilities — 46,824 — 46,824 Due to affiliates — 16,770 (16,770) — Payable for securities purchased — 514,946 — 514,946 CLO loan obligations — 10,015,989 (57,913) 9,958,076 Fund borrowings — 121,909 — 121,909 Total liabilities 1,965,302 10,716,438 (84,888) 12,596,852 Commitments and contingencies Redeemable interest in Ares Operating Group entities 100,366 — — 100,366 Non-controlling interest in Consolidated Funds — 863,565 (323,845) 539,720 Non-controlling interest in Ares Operating Group entities 738,369 — — 738,369 Stockholders' Equity Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (12,400,000 shares issued and outstanding) 298,761 — — 298,761 Class A common stock, $0.01 par value, 1,500,000,000 shares authorized (147,182,562 shares issued and outstanding) 1,472 — — 1,472 Class B common stock, $0.01 par value, 1,000 shares authorized (1,000 shares issued and outstanding) — — — — Class C common stock, $0.01 par value, 499,999,000 shares authorized (112,447,618 share issued and outstanding) 1,124 — — 1,124 Additional paid-in-capital 1,043,669 — — 1,043,669 Retained earnings (151,824) — — (151,824) Accumulated other comprehensive income, net of tax 483 — — 483 Total stockholders' equity 1,193,685 — — 1,193,685 Total equity 1,932,054 863,565 (323,845) 2,471,774 Total liabilities, redeemable interest, non-controlling interests and equity $ 3,997,722 $ 11,580,003 $ (408,733) $ 15,168,992 Three months ended September 30, 2021 Consolidated Consolidated Eliminations Consolidated Revenues Management fees $ 459,313 $ — $ (11,051) $ 448,262 Carried interest allocation 460,651 — — 460,651 Incentive fees 696 — — 696 Principal investment income 20,719 — (6,469) 14,250 Administrative, transaction and other fees 29,124 — (4,264) 24,860 Total revenues 970,503 — (21,784) 948,719 Expenses Compensation and benefits 335,569 — — 335,569 Performance related compensation 331,141 — — 331,141 General, administrative and other expense 134,453 — — 134,453 Expenses of the Consolidated Funds — 23,206 (11,102) 12,104 Total expenses 801,163 23,206 (11,102) 813,267 Other income (expense) Net realized and unrealized gains on investments 2,759 — 5,575 8,334 Interest and dividend income 2,702 — (1,326) 1,376 Interest expense (11,523) — — (11,523) Other income, net 36,338 — 316 36,654 Net realized and unrealized gains on investments of the Consolidated Funds — 36,695 (2,450) 34,245 Interest and other income of the Consolidated Funds — 104,344 (316) 104,028 Interest expense of the Consolidated Funds — (64,752) 3,174 (61,578) Total other income 30,276 76,287 4,973 111,536 Income before taxes 199,616 53,081 (5,709) 246,988 Income tax expense 30,273 2 — 30,275 Net income 169,343 53,079 (5,709) 216,713 Less: Net income attributable to non-controlling interests in Consolidated Funds — 53,079 (5,709) 47,370 Net income attributable to Ares Operating Group entities 169,343 — — 169,343 Less: Net income attributable to redeemable interest in Ares Operating Group entities 324 — — 324 Less: Net income attributable to non-controlling interests in Ares Operating Group entities 84,293 — — 84,293 Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 84,726 $ — $ — $ 84,726 Three months ended September 30, 2020 Consolidated Consolidated Eliminations Consolidated Revenues Management fees $ 304,153 $ — $ (11,719) $ 292,434 Carried interest allocation 168,978 — — 168,978 Incentive fees 7,194 — — 7,194 Principal investment income 18,080 — (6,672) 11,408 Administrative, transaction and other fees 14,300 — (4,448) 9,852 Total revenues 512,705 — (22,839) 489,866 Expenses Compensation and benefits 194,267 — — 194,267 Performance related compensation 122,356 — — 122,356 General, administrative and other expense 69,938 — — 69,938 Expenses of the Consolidated Funds — 17,737 (11,718) 6,019 Total expenses 386,561 17,737 (11,718) 392,580 Other income (expense) Net realized and unrealized gains (losses) on investments 2,303 — (4,910) (2,607) Interest and dividend income 1,602 — (258) 1,344 Interest expense (6,815) — — (6,815) Other income (expense), net (6,337) — 8,540 2,203 Net realized and unrealized gains on investments of the Consolidated Funds — 9,850 8,121 17,971 Interest and other income of the Consolidated Funds — 126,100 (9,519) 116,581 Interest expense of the Consolidated Funds — (67,818) 1,496 (66,322) Total other income (expense) (9,247) 68,132 3,470 62,355 Income before taxes 116,897 50,395 (7,651) 159,641 Income tax expense 18,197 117 — 18,314 Net income 98,700 50,278 (7,651) 141,327 Less: Net income attributable to non-controlling interests in Consolidated Funds — 50,278 (7,651) 42,627 Net income attributable to Ares Operating Group entities 98,700 — — 98,700 Less: Net loss attributable to redeemable interest in Ares Operating Group entities (1,007) — — (1,007) Less: Net income attributable to non-controlling interests in Ares Operating Group entities 52,162 — — 52,162 Net income attributable to Ares Management Corporation 47,545 — — 47,545 Less: Series A Preferred Stock dividends paid 5,425 — — 5,425 Net income attributable to Ares Management Corporation Class A common stockholders $ 42,120 $ — $ — $ 42,120 Nine months ended September 30, 2021 Consolidated Consolidated Eliminations Consolidated Revenues Management fees $ 1,169,237 $ — $ (33,416) $ 1,135,821 Carried interest allocation 1,610,707 — — 1,610,707 Incentive fees 20,948 — (1,528) 19,420 Principal investment income 96,448 — (9,971) 86,477 Administrative, transaction and other fees 62,658 — (13,157) 49,501 Total revenues 2,959,998 — (58,072) 2,901,926 Expenses Compensation and benefits 837,108 — — 837,108 Performance related compensation 1,208,954 — — 1,208,954 General, administrative and other expense 285,471 — — 285,471 Expenses of the Consolidated Funds — 66,653 (35,078) 31,575 Total expenses 2,331,533 66,653 (35,078) 2,363,108 Other income (expense) Net realized and unrealized gains on investments 10,602 — 8,142 18,744 Interest and dividend income 9,695 — (2,877) 6,818 Interest expense (25,125) — — (25,125) Other income, net 30,861 — (175) 30,686 Net realized and unrealized gains on investments of the Consolidated Funds — 46,541 (1,821) 44,720 Interest and other income of the Consolidated Funds — 333,570 175 333,745 Interest expense of the Consolidated Funds — (201,916) 10,339 (191,577) Total other income 26,033 178,195 13,783 218,011 Income before taxes 654,498 111,542 (9,211) 756,829 Income tax expense 104,411 76 — 104,487 Net income 550,087 111,466 (9,211) 652,342 Less: Net income attributable to non-controlling interests in Consolidated Funds — 111,466 (9,211) 102,255 Net income attributable to Ares Operating Group entities 550,087 — — 550,087 Less: Net income attributable to redeemable interest in Ares Operating Group entities 693 — — 693 Less: Net income attributable to non-controlling interests in Ares Operating Group entities 264,646 — — 264,646 Net income attributable to Ares Management Corporation 284,748 — — 284,748 Less: Series A Preferred Stock dividends paid 10,850 — — 10,850 Less: Series A Preferred Stock redemption premium 11,239 — — 11,239 Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 262,659 $ — $ — $ 262,659 Nine months ended September 30, 2020 Consolidated Consolidated Eliminations Consolidated Revenues Management fees $ 856,751 $ — $ (33,601) $ 823,150 Carried interest allocation 241,380 — — 241,380 Incentive fees 4,206 — 70 4,276 Principal investment income (loss) (24,951) — 33,281 8,330 Administrative, transaction and other fees 41,146 — (12,249) 28,897 Total revenues 1,118,532 — (12,499) 1,106,033 Expenses Compensation and benefits 559,482 — — 559,482 Performance related compensation 191,565 — — 191,565 General, administrative and other expense 190,353 — — 190,353 Expenses of the Consolidated Funds — 50,237 (33,531) 16,706 Total expenses 941,400 50,237 (33,531) 958,106 Other income (expense) Net realized and unrealized losses on investments (25,360) — 15,009 (10,351) Interest and dividend income 8,102 — (2,990) 5,112 Interest expense (18,203) — — (18,203) Other income, net 1,100 — 8,748 9,848 Net realized and unrealized losses on investments of the Consolidated Funds — (148,826) (4,442) (153,268) Interest and other income of the Consolidated Funds — 355,639 (9,519) 346,120 Interest expense of the Consolidated Funds — (227,532) 4,672 (222,860) Total other expense (34,361) (20,719) 11,478 (43,602) Income (loss) before taxes 142,771 (70,956) 32,510 104,325 Income tax expense 21,972 147 — 22,119 Net income (loss) 120,799 (71,103) 32,510 82,206 Less: Net loss attributable to non-controlling interests in Consolidated Funds — (71,103) 32,510 (38,593) Net income attributable to Ares Operating Group entities 120,799 — — 120,799 Less: Net loss attributable to redeemable interest in Ares Operating Group entities (1,007) — — (1,007) Less: Net income attributable to non-controlling interests in Ares Operating Group entities 48,926 — — 48,926 Net income attributable to Ares Management Corporation 72,880 — — 72,880 Less: Series A Preferred Stock dividends paid 16,275 — — 16,275 Net income attributable to Ares Management Corporation Class A common stockholders $ 56,605 $ — $ — $ 56,605 Nine months ended September 30, 2021 Consolidated Consolidated Eliminations Consolidated Cash flows from operating activities: Net income $ 550,087 $ 111,466 $ (9,211) $ 652,342 Adjustments to reconcile net income to net cash provided by (used in) operating activities (28,467) — 99,600 71,133 Adjustments to reconcile net income to net cash used in operating activities allocable to non-controlling interests in Consolidated Funds — (1,697,529) 9,444 (1,688,085) Cash flows due to changes in operating assets and liabilities (153,361) — 3,923 (149,438) Cash flows due to changes in operating assets and liabilities allocable to redeemable and non-controlling interest in Consolidated Funds — 343,253 (1,072,956) (729,703) Net cash provided by (used in) operating activities 368,259 (1,242,810) (969,200) (1,843,751) Cash flows from investing activities: Purchase of furniture, equipment and leasehold improvements, net of disposals (15,152) — — (15,152) Acquisitions, net of cash acquired (1,057,426) — — (1,057,426) Net cash used in investing activities (1,072,578) — — (1,072,578) Cash flows from financing activities: Net proceeds from issuance of Class A and non-voting common stock 827,430 — — 827,430 Proceeds from Credit Facility 468,000 — — 468,000 Proceeds from subordinated notes 450,000 — — 450,000 Repayments of Credit Facility (318,000) — — (318,000) Dividends and distributions (438,568) — — (438,568) Series A Preferred Stock dividends (10,850) — — (10,850) Redemption of Series A Preferred Stock (310,000) — — (310,000) Stock option exercises 27,409 — — 27,409 Taxes paid related to net share settlement of equity awards (221,287) — — (221,287) Other financing activities 1,976 — — 1,976 Allocable to redeemable and non-controlling interests in Consolidated Funds: Contributions from redeemable and non-controlling interests in Consolidated Funds — 1,027,454 (107,788) 919,666 Distributions to non-controlling interests in Consolidated Funds — (102,701) 17,931 (84,770) Borrowings under loan obligations by Consolidated Funds — 1,456,887 — 1,456,887 Repayments under loan obligations by Consolidated Funds — (74,909) — (74,909) Net cash provided by financing activities 476,110 2,306,731 (89,857) 2,692,984 Effect of exchange rate changes (15,899) (4,864) — (20,763) Net change in cash and cash equivalents (244,108) 1,059,057 (1,059,057) (244,108) Cash and cash equivalents, beginning of period 539,812 522,377 (522,377) 539,812 Cash and cash equivalents, end of period $ 295,704 $ 1,581,434 $ (1,581,434) $ 295,704 Supplemental disclosure of non-cash financing activities: Issuance of AOG Units in connection with acquisitions $ 511,069 $ — $ — $ 511,069 Nine months ended September 30, 2020 Consolidated Consolidated Eliminations Consolidated Cash flows from operating activities: Net income (loss) $ 120,799 $ (71,103) $ 32,510 $ 82,206 Adjustments to reconcile net income to net cash provided by operating activities 207,358 — (22,772) 184,586 Adjustments to reconcile net income to net cash used in operating activities allocable to non-controlling interests in Consolidated Funds — (733,607) (32,792) (766,399) Cash flows due to changes in operating assets and liabilities 152,691 — (6,989) 145,702 Cash flows due to changes in operating assets and liabilities allocable to non-controlling interest in Consolidated Funds — 105,992 260,375 366,367 Net cash provided by (used in) operating activities 480,848 (698,718) 230,332 12,462 Cash flows from investing activities: Purchase of furniture, equipment and leasehold improvements, net of disposals (8,608) — — (8,608) Cash paid for asset acquisition (117,829) — — (117,829) Net cash used in investing activities (126,437) — — (126,437) Cash flows from financing activities: Proceeds from issuance of Class A common stock 383,154 — — 383,154 Proceeds from Credit Facility 790,000 — — 790,000 Proceeds from Senior Notes 399,084 — — 399,084 Repayments of Credit Facility (860,000) — — (860,000) Dividends and distributions (334,957) — — (334,957) Series A Preferred Stock dividends (16,275) — — (16,275) Stock option exercises 78,959 — — 78,959 Taxes paid related to net share settlement of equity awards (75,657) — — (75,657) Other financing activities (4,137) — — (4,137) Allocable to non-controlling interests in Consolidated Funds: Contributions from non-controlling interests in Consolidated Funds — 138,760 (15,047) 123,713 Distributions to non-controlling interests in Consolidated Funds — (195,598) 25,851 (169,747) Borrowings under loan obligations by Consolidated Funds — 618,207 — 618,207 Repayments under loan obligations by Consolidated Funds — (104,794) — (104,794) Net cash provided by financing activities 360,171 456,575 10,804 827,550 Effect of exchange rate changes 15,786 1,007 — 16,793 Net change in cash and cash equivalents 730,368 (241,137) 241,137 730,368 Cash and cash equivalents, beginning of period 138,384 606,321 (606,321) 138,384 Cash and cash equivalents, end of period $ 868,752 $ 365,185 $ (365,185) $ 868,752 Supplemental disclosure of non-cash financing activities Issuance of Class A common stock in connection with acquisitions $ 305,388 $ — $ — $ 305,338 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 17. SUBSEQUENT EVENTS The Company evaluated all events or transactions that occurred after September 30, 2021 through the date the condensed consolidated financial statements were issued. During this period, the Company had the following material subsequent events that require disclosure: |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements are prepared in accordance with the generally accepted accounting principles in the United States (“GAAP”) for interim financial information and instructions to the Quarterly Report on Form 10-Q. The condensed consolidated financial statements, including these notes, are unaudited and exclude some of the disclosures required in annual financial statements. Management believes it has made all necessary adjustments so that the condensed consolidated financial statements are presented fairly and that estimates made in preparing its condensed consolidated financial statements are reasonable and prudent, and that all such adjustments are of a normal recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission (“SEC”). As of September 30, 2021, the impact of the outbreak of the novel coronavirus (“COVID-19”) pandemic continues to unfold. As a result, management's estimates and assumptions may be subject to a higher degree of variability and volatility that may result in material differences from the current period. The condensed consolidated financial statements include the accounts and activities of the AOG entities, their consolidated subsidiaries and certain Consolidated Funds. All intercompany balances and transactions have been eliminated upon consolidation. |
Reclassifications | The Company has reclassified certain prior period amounts to conform to the current year presentation. |
Business Combinations | Business Combinations The Company accounts for business combinations using the acquisition method of accounting, under which the purchase price of the acquisition, including the fair value of certain elements of contingent consideration, is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. Contingent consideration obligations are recognized as of the acquisition date at fair value based on the probability that contingency will be realized. Any fair value of purchase consideration in excess of the fair value of the assets acquired less liabilities assumed is recorded as goodwill. Conversely, any excess of the fair value of the net assets acquired over the purchase consideration is recognized as a bargain purchase gain. Acquisition-related costs incurred in connection with a business combination are expensed as incurred. |
U.S. Treasury Securities, at Fair Value | U.S. Treasury Securities, at Fair Value U.S. Treasury securities, at fair value represents U.S. Treasury bills that were purchased with funds raised through the initial public offering of AAC, a consolidated SPAC that is presented within Consolidated Funds. The funds raised are held in a trust account that is restricted for use and may only be used for purposes of completing an initial business combination or redemption of public shares as set forth in the trust agreement. The U.S. Treasury bills have original maturities greater than three months when purchased and therefore are recorded at fair value. Interest income received on such securities is separately presented from the overall change in fair value and is recognized within interest and other income of Consolidated Funds in the |
Redeemable Interest in Consolidated Funds | Redeemable Interest in Consolidated FundsRedeemable interest in Consolidated Funds represent the Class A ordinary shares issued by AAC that are redeemable for cash by the public shareholders in the event that AAC does not complete a business combination or tender offer associated with stockholder approval provisions. The class A ordinary shareholders have redemption rights that are considered to be outside of AAC’s control. At each balance sheet date, the carrying value of the redeemable interest is presented at the redemption amount. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company considers the applicability and impact of all accounting standard updates (“ASU”) issued by the Financial Accounting Standards Board (“FASB”). ASUs not listed below were assessed and either determined to be not applicable or expected to have minimal impact on its condensed consolidated financial statements. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). The amendments in this update provide optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this update apply only to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued because of reference rate reform. In January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) , to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. An entity may elect to adopt the amendments in ASU 2020-04 and ASU 2021-01 at any time after March 12, 2020 but no later than December 31, 2022. The expedients and exceptions provided by the amendments do not apply to contract modifications and hedging relationships entered into or evaluated after December 31, 2022, except for hedging transactions as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. The Company is currently evaluating the impact of this guidance on its condensed consolidated financial statements. |
Fair Value Measurements | GAAP establishes a hierarchical disclosure framework that prioritizes the inputs used in measuring financial instruments at fair value into three levels based on their market price observability. Market price observability is affected by a number of factors, including the type of instrument and the characteristics specific to the instrument. Financial instruments with readily available quoted prices from an active market or for which fair value can be measured based on actively quoted prices generally have a higher degree of market price observability and a lesser degree of judgment inherent in measuring fair value. Financial assets and liabilities measured and reported at fair value are classified as follows: • Level I —Quoted prices in active markets for identical instruments. • Level II —Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in inactive markets; and model-derived valuations with directly or indirectly observable significant inputs. Level II inputs include prices in markets with few transactions, non-current prices, prices for which little public information exists or prices that vary substantially over time or among brokered market makers. Other inputs include interest rates, yield curves, volatilities, prepayment risks, loss severities, credit risks and default rates. • Level III —Valuations that rely on one or more significant unobservable inputs. These inputs reflect the Company’s assessment of the assumptions that market participants would use to value the instrument based on the best information available. In some instances, an instrument may fall into more than one level of the fair value hierarchy. In such instances, the instrument’s level within the fair value hierarchy is based on the lowest of the three levels (with Level III being the lowest) that is significant to the fair value measurement. The Company’s assessment of the significance of an input requires judgment and considers factors specific to the instrument. The Company accounts for the transfer of assets into or out of each fair value hierarchy level as of the beginning of the reporting period. Contingent consideration: The Company generally determines the fair value of its contingent consideration liabilities by using a Monte Carlo simulation model. The model considers a range of assumptions including historical experience, prior period performance, current progress towards targets, probability-weighted scenarios, and management's own assumptions. The discount rate used is determined based on the weighted average cost of capital for the Company. The fair value of the |
BUSINESS COMBINATIONS (Tables)
BUSINESS COMBINATIONS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Business Acquisitions Fair Value Consideration Transferred | The acquisition date fair value of the consideration transferred totaled $1.1 billion, which consisted of the following: Cash $ 803,829 Equity (1) 299,640 Total $ 1,103,469 (1) 5,419,413 AOG Units were issued in connection with the Landmark Acquisition and increased Ares Owners Holdings L.P.’s ownership interest in the AOG entities. |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The fair value of assets acquired and liabilities assumed are estimated to be: Cash $ 25,685 Other tangible assets 23,411 Intangible assets: Management contracts 425,880 Client relationships 197,160 Trade name 86,200 Total intangible assets 709,240 Total identifiable assets acquired 758,336 Accounts payable, accrued expenses and other liabilities 72,532 Net identifiable assets acquired 685,804 Goodwill 417,665 Net assets acquired $ 1,103,469 |
Schedule of Business Acquisition, Pro Forma Information | Supplemental information of the Company’s consolidated results on an unaudited pro forma basis, as if the Landmark Acquisition had been consummated as of January 1, 2020, is as follows: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Total revenues $ 948,719 $ 527,105 $ 2,966,540 $ 1,214,989 Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 87,542 $ 37,570 $ 257,361 $ 41,263 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Carrying Value for the Company's Intangible Assets | The following table summarizes the carrying value, net of accumulated amortization, of the Company's intangible assets: Weighted Average Amortization Period as of September 30, 2021 As of September 30, As of December 31, 2021 2020 Management contracts 6.5 years $ 641,737 $ 210,857 Client relationships 11.2 years 229,501 25,141 Trade name 8.7 years 11,079 11,079 Finite-lived intangible assets 882,317 247,077 Foreign currency translation 1,530 3,093 Total finite-lived intangible assets 883,847 250,170 Less: accumulated amortization (85,157) (28,082) Finite-lived intangible assets, net 798,690 222,088 Management contracts 567,800 — Trade name 86,200 — Indefinite-lived intangible assets 654,000 — Intangible assets, net $ 1,452,690 $ 222,088 |
Schedule of Goodwill Rollforward | The following table summarizes the carrying value of goodwill that is included within other assets in the Condensed Consolidated Statements of Financial Condition: Credit Group Private Real Secondary Solutions Group Strategic Initiatives Total Balance as of December 31, 2020 $ 32,196 $ 58,600 $ 53,120 $ — $ 227,131 $ 371,047 Acquisitions — — — 417,665 — 417,665 Foreign currency translation — — 219 (16) (1,165) (962) Balance as of September 30, 2021 $ 32,196 $ 58,600 $ 53,339 $ 417,649 $ 225,966 $ 787,750 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Investments in and Advances to Affiliates [Abstract] | |
Summary of Investments Held | The Company’s investments are comprised of the following: Percentage of total investments September 30, December 31, September 30, December 31, 2021 2020 2021 2020 Equity method investments: Equity method private investment partnership interests - principal (1) $ 492,482 $ 366,471 14.8 % 21.8 % Equity method - carried interest (1) 2,625,319 1,145,853 79.0 68.1 Equity method private investment partnership interests and other (held at fair value) (1) 117,015 92,196 3.5 5.5 Equity method private investment partnership interests and other (1) 32,132 23,883 1.0 1.4 Total equity method investments 3,266,948 1,628,403 98.3 96.8 Collateralized loan obligations (2) 32,724 31,766 1.0 1.9 Other fixed income 21,583 21,583 0.6 1.3 Collateralized loan obligations and other fixed income, at fair value 54,307 53,349 1.6 3.2 Common stock, at fair value 1,410 1,007 0.1 0.1 Total investments $ 3,322,665 $ 1,682,759 (1) Investment or portion of the investment is denominated in foreign currency and is translated into U.S. dollars at each reporting date. (2) As of September 30, 2021 and December 31, 2020, includes $3.2 million and $3.4 million, respectively, of collateralized loan obligations that are attributable to the Class B Membership Interests. Investments held in the Consolidated Funds are summarized below: Fair Value at Percentage of total investments as of September 30, December 31, September 30, December 31, 2021 2020 2021 2020 Fixed income investments: Bonds $ 434,226 $ 397,494 3.9 % 3.6% Loans 9,389,769 10,012,948 82.6 92.1 U.S. Treasury securities 1,000,165 — 8.8 — Investments in CLO warehouse 28,500 — 0.3 — Total fixed income investments 10,852,660 10,410,442 95.6 95.7 Equity securities 264,202 227,031 2.3 2.1 Partnership interests 244,157 239,624 2.1 2.2 Total investments, at fair value $ 11,361,019 $ 10,877,097 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Summary of Valuation of Investments and Other Financial Instruments by Fair Value Hierarchy Levels | The following tables summarize the financial assets and financial liabilities measured at fair value for the Company and the Consolidated Funds as of September 30, 2021: Financial Instruments of the Company Level I Level II Level III Investments Total Assets, at fair value Investments: Collateralized loan obligations and other fixed income $ — $ — $ 54,307 $ — $ 54,307 Common stock and other equity securities — 1,410 108,397 — 109,807 Partnership interests — — 2,575 6,043 8,618 Total investments, at fair value — 1,410 165,279 6,043 172,732 Derivatives-foreign exchange contracts and interest rate contracts — 4,361 — — 4,361 Total assets, at fair value $ — $ 5,771 $ 165,279 $ 6,043 $ 177,093 Liabilities, at fair value Derivatives-foreign exchange contracts — (265) — — (265) Contingent consideration — — (41,413) — (41,413) Total liabilities, at fair value $ — $ (265) $ (41,413) $ — $ (41,678) Financial Instruments of the Consolidated Funds Level I Level II Level III Investments Total Assets, at fair value Investments: Fixed income investments: Bonds $ — $ 406,253 $ 27,973 $ — $ 434,226 Loans — 9,015,066 374,703 — 9,389,769 U.S. Treasury securities 1,000,165 — — — 1,000,165 Investments in CLO warehouse — 28,500 — — 28,500 Total fixed income investments 1,000,165 9,449,819 402,676 — 10,852,660 Equity securities 3,366 1,590 259,246 — 264,202 Partnership interests — — 237,558 6,599 244,157 Total investments, at fair value $ 1,003,531 $ 9,451,409 $ 899,480 $ 6,599 $ 11,361,019 Derivatives: Asset swaps-other — — 325 — 325 Total derivative assets, at fair value — — 325 — 325 Total assets, at fair value $ 1,003,531 $ 9,451,409 $ 899,805 $ 6,599 $ 11,361,344 Liabilities, at fair value Derivatives: Warrants $ (17,000) $ — $ — $ — $ (17,000) Asset swaps-other — — (1,513) — (1,513) Total derivative liabilities, at fair value (17,000) — (1,513) — (18,513) Loan obligations of CLOs — (10,174,794) — — (10,174,794) Total liabilities, at fair value $ (17,000) $ (10,174,794) $ (1,513) $ — $ (10,193,307) The following tables summarize the financial assets and financial liabilities measured at fair value for the Company and the Consolidated Funds as of December 31,2020: Financial Instruments of the Company Level I Level II Level III Investments Total Assets, at fair value Investments: Collateralized loan obligations and other fixed income $ — $ — $ 53,349 $ — $ 53,349 Common stock and other equity securities — 1,007 88,412 — 89,419 Partnership interests — — 2,575 1,209 3,784 Total investments, at fair value — 1,007 144,336 1,209 146,552 Derivatives-foreign exchange contracts — 1,440 — — 1,440 Total assets, at fair value $ — $ 2,447 $ 144,336 $ 1,209 $ 147,992 Liabilities, at fair value Derivatives-foreign exchange contracts $ — $ (1,565) $ — $ — $ (1,565) Total liabilities, at fair value $ — $ (1,565) $ — $ — $ (1,565) Financial Instruments of the Consolidated Funds Level I Level II Level III Investments Measured Total Assets, at fair value Investments: Fixed income investments: Bonds $ — $ 397,485 $ 9 $ — $ 397,494 Loans — 9,470,651 542,297 — 10,012,948 Total fixed income investments — 9,868,136 542,306 — 10,410,442 Equity securities 5,749 239 221,043 — 227,031 Partnership interests — — 231,857 7,767 239,624 Total investments, at fair value 5,749 9,868,375 995,206 7,767 10,877,097 Derivatives: Asset swaps-other — — 1,104 — 1,104 Total assets, at fair value $ 5,749 $ 9,868,375 $ 996,310 $ 7,767 $ 10,878,201 Liabilities, at fair value Derivatives: Asset swaps-other $ — $ — $ (44) $ — $ (44) Loan obligations of CLOs — (9,958,076) — — (9,958,076) Total liabilities, at fair value $ — $ (9,958,076) $ (44) $ — $ (9,958,120) |
Summary of Changes in the Fair Value of the Level III Investments, Assets | The following tables set forth a summary of changes in the fair value of the Level III measurements for the three months ended September 30, 2021: Level III Assets and Liabilities of the Company Equity Securities Fixed Income Partnership Interests Contingent Consideration Total Balance, beginning of period $ 107,240 $ 55,840 $ 2,575 $ — $ 165,655 Established in connection with acquisition — — — (34,200) (34,200) Purchases (1) — 708 — — 708 Sales/settlements (2) — (2,904) — — (2,904) Realized and unrealized appreciation (depreciation), net 1,157 663 — (7,213) (5,393) Balance, end of period $ 108,397 $ 54,307 $ 2,575 $ (41,413) $ 123,866 Change in net unrealized appreciation/depreciation included in earnings related to financial assets and liabilities still held at the reporting date $ 1,157 $ 675 $ — $ (7,213) $ (5,381) Level III Net Assets of Consolidated Funds Equity Securities Fixed Income Partnership Derivatives, Net Total Balance, beginning of period $ 229,300 $ 455,426 $ 255,278 $ (1,658) $ 938,346 Transfer in — 18,792 — — 18,792 Transfer out — (209,282) — — (209,282) Purchases (1) 27,346 219,180 — — 246,526 Sales/settlements (2) (313) (88,584) (30,000) 625 (118,272) Amortized discounts/premiums — 394 — — 394 Realized and unrealized appreciation (depreciation), net 2,913 6,750 12,280 (155) 21,788 Balance, end of period $ 259,246 $ 402,676 $ 237,558 $ (1,188) $ 898,292 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 2,912 $ 1,607 $ 12,280 $ (63) $ 16,736 (1) Purchases include paid-in-kind interest and securities received in connection with restructuring. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the three months ended September 30, 2020: Level III Assets of the Company Equity Securities Fixed Income Partnership Interests Total Balance, beginning of period $ 14,704 $ 67,355 $ 2,575 $ 84,634 Transfer in due to changes in consolidation 72,967 — — 72,967 Purchases (1) — 5,983 — 5,983 Sales/settlements (2) — (899) — (899) Realized and unrealized appreciation (depreciation), net (1,746) 3,175 — 1,429 Balance, end of period $ 85,925 $ 75,614 $ 2,575 $ 164,114 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (1,746) $ 3,175 $ — $ 1,429 Level III Net Assets of Consolidated Funds Equity Securities Fixed Income Partnership Interests Derivatives, Net Total Balance, beginning of period $ 42,259 $ 586,287 $ 312,636 $ 1,402 $ 942,584 Transfer in — 96,671 — — 96,671 Transfer out — (230,326) — — (230,326) Purchases (1) 150 118,558 — — 118,708 Sales/settlements (2) (25) (73,010) (2,000) 705 (74,330) Amortized discounts/premiums — (135) — 140 5 Realized and unrealized appreciation (depreciation), net 828 15,836 (1,402) (393) 14,869 Balance, end of period $ 43,212 $ 513,881 $ 309,234 $ 1,854 $ 868,181 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 878 $ 13,690 $ (1,402) $ (604) $ 12,562 (1) Purchases include paid-in-kind interest and securities received in connection with restructurings. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the nine months ended September 30, 2021: Level III Assets and Liabilities of the Company Equity Fixed Income Partnership Interests Contingent Consideration Total Balance, beginning of period $ 88,412 $ 53,349 $ 2,575 $ — $ 144,336 Transfer in due to changes in consolidation — 7,623 — — 7,623 Established in connection with acquisition — — — (34,200) (34,200) Purchases (1) 19,278 1,689 — — 20,967 Sales/settlements (2) — (12,120) — — (12,120) Realized and unrealized appreciation (depreciation), net 707 3,766 — (7,213) (2,740) Balance, end of period $ 108,397 $ 54,307 $ 2,575 $ (41,413) $ 123,866 Change in net unrealized appreciation/depreciation included in earnings related to financial assets and liabilities still held at the reporting date $ 707 $ 2,315 $ — $ (7,213) $ (4,191) Level III Net Assets of Consolidated Funds Equity Fixed Partnership Derivatives, Net Total Balance, beginning of period $ 221,043 $ 542,305 $ 231,857 $ 1,060 $ 996,265 Transfer out due to changes in consolidation (157) (49,326) — — (49,483) Transfer in 2,195 47,818 — — 50,013 Transfer out (33) (216,177) — — (216,210) Purchases (1) 36,201 437,426 13,000 — 486,627 Sales/settlements (2) (876) (371,006) (32,000) 301 (403,581) Amortized discounts/premiums 1 1,464 — — 1,465 Realized and unrealized appreciation (depreciation), net 872 10,172 24,701 (2,549) 33,196 Balance, end of period $ 259,246 $ 402,676 $ 237,558 $ (1,188) $ 898,292 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 790 $ 2,700 $ 24,701 $ (1,670) $ 26,521 (1) Purchases include paid-in-kind interest and securities received in connection with restructuring. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the nine months ended September 30, 2020: Level III Assets and Liabilities of the Company Equity Fixed Income Partnership Interests Total Balance, beginning of period $ 14,704 $ 69,183 $ 35,192 $ 119,079 Transfer in due to changes in consolidation 72,967 3,686 — 76,653 Purchases (1) — 7,285 — 7,285 Sales/settlements (2) — (1,587) (32,430) (34,017) Realized and unrealized depreciation, net (1,746) (2,953) (187) (4,886) Balance, end of period $ 85,925 $ 75,614 $ 2,575 $ 164,114 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (1,746) $ (1,917) $ 5,511 $ 1,848 Level III Net Assets of Consolidated Funds Equity Fixed Partnership Interests Derivatives, Net Total Balance, beginning of period $ 85,988 $ 339,136 $ 296,012 $ (4,106) $ 717,030 Transfer in (out) due to changes in consolidation (635) 392,672 — — 392,037 Transfer in — 146,839 — — 146,839 Transfer out — (350,078) — — (350,078) Purchases (1) 551 256,514 64,000 — 321,065 Sales/settlements (2) (714) (249,027) (58,000) 813 (306,928) Amortized discounts/premiums — 777 — 291 1,068 Realized and unrealized appreciation (depreciation), net (41,978) (22,952) 7,222 4,856 (52,852) Balance, end of period $ 43,212 $ 513,881 $ 309,234 $ 1,854 $ 868,181 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (41,930) $ (25,701) $ 7,222 $ 4,439 $ (55,970) (1) Purchases include paid-in-kind interest and securities received in connection with restructurings. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. |
Summary of Changes in the Fair Value of the Level III Investments, Liabilities | The following tables set forth a summary of changes in the fair value of the Level III measurements for the three months ended September 30, 2021: Level III Assets and Liabilities of the Company Equity Securities Fixed Income Partnership Interests Contingent Consideration Total Balance, beginning of period $ 107,240 $ 55,840 $ 2,575 $ — $ 165,655 Established in connection with acquisition — — — (34,200) (34,200) Purchases (1) — 708 — — 708 Sales/settlements (2) — (2,904) — — (2,904) Realized and unrealized appreciation (depreciation), net 1,157 663 — (7,213) (5,393) Balance, end of period $ 108,397 $ 54,307 $ 2,575 $ (41,413) $ 123,866 Change in net unrealized appreciation/depreciation included in earnings related to financial assets and liabilities still held at the reporting date $ 1,157 $ 675 $ — $ (7,213) $ (5,381) Level III Net Assets of Consolidated Funds Equity Securities Fixed Income Partnership Derivatives, Net Total Balance, beginning of period $ 229,300 $ 455,426 $ 255,278 $ (1,658) $ 938,346 Transfer in — 18,792 — — 18,792 Transfer out — (209,282) — — (209,282) Purchases (1) 27,346 219,180 — — 246,526 Sales/settlements (2) (313) (88,584) (30,000) 625 (118,272) Amortized discounts/premiums — 394 — — 394 Realized and unrealized appreciation (depreciation), net 2,913 6,750 12,280 (155) 21,788 Balance, end of period $ 259,246 $ 402,676 $ 237,558 $ (1,188) $ 898,292 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 2,912 $ 1,607 $ 12,280 $ (63) $ 16,736 (1) Purchases include paid-in-kind interest and securities received in connection with restructuring. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the three months ended September 30, 2020: Level III Assets of the Company Equity Securities Fixed Income Partnership Interests Total Balance, beginning of period $ 14,704 $ 67,355 $ 2,575 $ 84,634 Transfer in due to changes in consolidation 72,967 — — 72,967 Purchases (1) — 5,983 — 5,983 Sales/settlements (2) — (899) — (899) Realized and unrealized appreciation (depreciation), net (1,746) 3,175 — 1,429 Balance, end of period $ 85,925 $ 75,614 $ 2,575 $ 164,114 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (1,746) $ 3,175 $ — $ 1,429 Level III Net Assets of Consolidated Funds Equity Securities Fixed Income Partnership Interests Derivatives, Net Total Balance, beginning of period $ 42,259 $ 586,287 $ 312,636 $ 1,402 $ 942,584 Transfer in — 96,671 — — 96,671 Transfer out — (230,326) — — (230,326) Purchases (1) 150 118,558 — — 118,708 Sales/settlements (2) (25) (73,010) (2,000) 705 (74,330) Amortized discounts/premiums — (135) — 140 5 Realized and unrealized appreciation (depreciation), net 828 15,836 (1,402) (393) 14,869 Balance, end of period $ 43,212 $ 513,881 $ 309,234 $ 1,854 $ 868,181 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 878 $ 13,690 $ (1,402) $ (604) $ 12,562 (1) Purchases include paid-in-kind interest and securities received in connection with restructurings. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the nine months ended September 30, 2021: Level III Assets and Liabilities of the Company Equity Fixed Income Partnership Interests Contingent Consideration Total Balance, beginning of period $ 88,412 $ 53,349 $ 2,575 $ — $ 144,336 Transfer in due to changes in consolidation — 7,623 — — 7,623 Established in connection with acquisition — — — (34,200) (34,200) Purchases (1) 19,278 1,689 — — 20,967 Sales/settlements (2) — (12,120) — — (12,120) Realized and unrealized appreciation (depreciation), net 707 3,766 — (7,213) (2,740) Balance, end of period $ 108,397 $ 54,307 $ 2,575 $ (41,413) $ 123,866 Change in net unrealized appreciation/depreciation included in earnings related to financial assets and liabilities still held at the reporting date $ 707 $ 2,315 $ — $ (7,213) $ (4,191) Level III Net Assets of Consolidated Funds Equity Fixed Partnership Derivatives, Net Total Balance, beginning of period $ 221,043 $ 542,305 $ 231,857 $ 1,060 $ 996,265 Transfer out due to changes in consolidation (157) (49,326) — — (49,483) Transfer in 2,195 47,818 — — 50,013 Transfer out (33) (216,177) — — (216,210) Purchases (1) 36,201 437,426 13,000 — 486,627 Sales/settlements (2) (876) (371,006) (32,000) 301 (403,581) Amortized discounts/premiums 1 1,464 — — 1,465 Realized and unrealized appreciation (depreciation), net 872 10,172 24,701 (2,549) 33,196 Balance, end of period $ 259,246 $ 402,676 $ 237,558 $ (1,188) $ 898,292 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ 790 $ 2,700 $ 24,701 $ (1,670) $ 26,521 (1) Purchases include paid-in-kind interest and securities received in connection with restructuring. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. The following tables set forth a summary of changes in the fair value of the Level III measurements for the nine months ended September 30, 2020: Level III Assets and Liabilities of the Company Equity Fixed Income Partnership Interests Total Balance, beginning of period $ 14,704 $ 69,183 $ 35,192 $ 119,079 Transfer in due to changes in consolidation 72,967 3,686 — 76,653 Purchases (1) — 7,285 — 7,285 Sales/settlements (2) — (1,587) (32,430) (34,017) Realized and unrealized depreciation, net (1,746) (2,953) (187) (4,886) Balance, end of period $ 85,925 $ 75,614 $ 2,575 $ 164,114 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (1,746) $ (1,917) $ 5,511 $ 1,848 Level III Net Assets of Consolidated Funds Equity Fixed Partnership Interests Derivatives, Net Total Balance, beginning of period $ 85,988 $ 339,136 $ 296,012 $ (4,106) $ 717,030 Transfer in (out) due to changes in consolidation (635) 392,672 — — 392,037 Transfer in — 146,839 — — 146,839 Transfer out — (350,078) — — (350,078) Purchases (1) 551 256,514 64,000 — 321,065 Sales/settlements (2) (714) (249,027) (58,000) 813 (306,928) Amortized discounts/premiums — 777 — 291 1,068 Realized and unrealized appreciation (depreciation), net (41,978) (22,952) 7,222 4,856 (52,852) Balance, end of period $ 43,212 $ 513,881 $ 309,234 $ 1,854 $ 868,181 Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date $ (41,930) $ (25,701) $ 7,222 $ 4,439 $ (55,970) (1) Purchases include paid-in-kind interest and securities received in connection with restructurings. (2) Sales/settlements include distributions, principal redemptions and securities disposed of in connection with restructurings. |
Summary of Quantitative Inputs and Assumptions used for Level III Inputs | The following tables summarize the quantitative inputs and assumptions used for the Company’s and the Consolidated Funds' Level III measurements as of September 30, 2021: Level III Measurements of the Company Fair Value Valuation Technique(s) Significant Unobservable Input(s) Range Weighted Average Assets Equity securities $ 14,704 Transaction price (1) N/A N/A N/A 46,765 Discounted cash flow Discount Rates 14.0% - 20.0% 15.3% 46,928 Market approach Multiple of Book Value 1.5x N/A Partnership interests 2,575 Other N/A N/A N/A Collateralized loan obligations 32,724 Broker quotes and/or 3rd party pricing services N/A N/A N/A Other fixed income 21,583 Other N/A N/A N/A Total assets $ 165,279 Liabilities Contingent consideration $ (8,600) Monte Carlo simulation Discount Rates 8% N/A Volatility 17% N/A $ (32,813) Other N/A N/A N/A Total liabilities $ (41,413) Level III Measurements of the Consolidated Funds Fair Value Valuation Technique(s) Significant Unobservable Input(s) Range Weighted Average Assets Equity securities $ 896 Market approach EBITDA multiple (2) 1.8x - 83.3x 15.3x 14 Broker quotes and/or 3rd party pricing services N/A N/A N/A 258,336 Transaction price (1) N/A N/A N/A Partnership interest 237,558 Discounted cash flow Discount rate 22.4% 22.4% Fixed income securities 261,064 Broker quotes and/or 3rd party pricing services N/A N/A N/A 98,055 Income approach Yield 1.8%-54.7% 6.5% 14,791 Transaction price N/A N/A N/A 28,766 Other N/A N/A N/A Derivative instruments 325 Broker quotes and/or 3rd party pricing services N/A N/A N/A Total assets $ 899,805 Liabilities Derivative instruments $ (1,513) Broker quotes and/or 3rd party pricing services N/A N/A N/A Total liabilities $ (1,513) (1) Transaction price consists of securities purchased or restructured. The Company determined that there was no change to the valuation based on the underlying assumptions used at the closing of such transactions. (2) “EBITDA” in the table above is a non-GAAP financial measure and refers to earnings before interest, tax, depreciation and amortization. The following tables summarize the quantitative inputs and assumptions used for the Company’s and the Consolidated Funds' Level III measurements as of December 31, 2020: Level III Measurements of the Company Fair Value Valuation Technique(s) Significant Unobservable Input(s) Range Assets Equity securities $ 14,704 Transaction price (1) N/A N/A 32,905 Discounted Cash Flow Discount Rates 14.0% - 20.0% 40,803 Market Approach Multiple of Book Value 1.6x Partnership interests 2,575 Other N/A N/A Collateralized loan obligations 31,766 Broker quotes and/or 3rd party pricing services N/A N/A Other fixed income 21,583 Other N/A N/A Total $ 144,336 Level III Measurements of the Consolidated Funds Fair Value Valuation Technique(s) Significant Unobservable Input(s) Range Weighted Average Assets Equity securities $ 438 Market approach EBITDA multiple (2) 2.9x - 19.5x 13.4x 32,528 Other Net income multiple 30.0x 30.0x Illiquidity discount 25.0% 25.0% 33 Broker quotes and/or 3rd party pricing services N/A N/A N/A 188,044 Transaction price (1) N/A N/A N/A Partnership interests 231,857 Discounted cash flow Discount rate 23.8% 23.8% Fixed income securities 384,419 Broker quotes and/or 3rd party pricing services N/A N/A N/A 6,605 Market approach EBITDA multiple (2) 6.5x - 7.8x 6.9x 122,962 Income approach Yield 2.7% - 48.1% 7.9% 28,320 Other N/A N/A N/A Derivative instruments 1,104 Broker quotes and/or 3rd party pricing services N/A N/A N/A Total assets $ 996,310 Liabilities Derivative instruments $ (44) Broker quotes and/or 3rd party pricing services N/A N/A N/A Total liabilities $ (44) (1) Transaction price consists of securities purchased or restructured. The Company determined that there has been no change to the valuation based on the underlying assumptions used at the closing of such transactions. (2) “EBITDA” in the table above is a non-GAAP financial measure and refers to earnings before interest, tax, depreciation and amortization. |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Value and Notional Amounts of Derivative Contracts by Major Product Type on a Gross Basis | The following tables identify the fair value and notional amounts of derivative contracts by major product type on a gross basis for the Company and the Consolidated Funds: As of September 30, 2021 As of December 31, 2020 Assets Liabilities Assets Liabilities The Company Notional (1) Fair Value Notional (1) Fair Value Notional (1) Fair Value Notional (1) Fair Value Foreign exchange contracts $ 81,008 $ 4,352 $ 9,868 $ 265 $ 30,040 $ 1,440 $ 39,362 $ 1,565 Interest rate contracts 18,455 9 — — — — — — Total derivatives, at fair value (2) $ 99,463 $ 4,361 $ 9,868 $ 265 $ 30,040 $ 1,440 $ 39,362 $ 1,565 As of September 30, 2021 As of December 31, 2020 Assets Liabilities Assets Liabilities Consolidated Funds Notional (1) Fair Value Notional (1) Fair Value Notional (1) Fair Value Notional (1) Fair Value Warrants $ — $ — $ 230,000 $ 17,000 $ — $ — $ — $ — Asset swap - other 44,521 325 39,701 1,513 7,600 1,104 540 44 Total derivatives, at fair value (3) $ 44,521 $ 325 $ 269,701 $ 18,513 $ 7,600 $ 1,104 $ 540 $ 44 (1) Represents the total contractual amount of derivative assets and liabilities outstanding. (2) As of September 30, 2021 and December 31, 2020, the Company had the right to, but elected not to, offset $0.3 million and $1.6 million of its derivative liabilities. (3) As of September 30, 2021 and December 31, 2020, the Consolidated Funds offset $0.3 million and $0.4 million of their derivative assets and liabilities, respectively. |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Borrowings Outstanding | The following table summarizes the Company’s and its subsidiaries’ debt obligations: As of September 30, 2021 As of December 31, 2020 Debt Origination Date Maturity Original Borrowing Amount Carrying Interest Rate Carrying Interest Rate Credit Facility (1) Revolver 3/31/2026 N/A $ 150,000 1.13% $ — —% 2024 Senior Notes (2) 10/8/2014 10/8/2024 $ 250,000 247,802 4.21 247,285 4.21 2030 Senior Notes (3) 6/15/2020 6/15/2030 400,000 396,045 3.28 395,713 3.28 2051 Subordinated Notes (4) 6/30/2021 6/30/2051 450,000 444,478 4.13 — — Total debt obligations $ 1,238,325 $ 642,998 (1) The AOG entities are borrowers under the Credit Facility, which provides a $1.090 billion revolving line of credit. It has a variable interest rate based on LIBOR or a base rate plus an applicable margin with an unused commitment fee paid quarterly, which is subject to change with the Company’s underlying credit agency rating. On March 31, 2021, the Company amended the Credit Facility to, among other things, extend the maturity date from March 2025 to March 2026. As of September 30, 2021, base rate loans bear interest calculated based on the base rate plus 0.125% and the LIBOR rate loans bear interest calculated based on LIBOR plus 1.125%. The unused commitment fee is 0.10% per annum. There is a base rate and LIBOR floor of zero. (2) The 2024 Senior Notes were issued in October 2014 by Ares Finance Co. LLC, an indirect subsidiary of the Company, at 98.27% of the face amount with interest paid semi-annually. The Company may redeem the 2024 Senior Notes prior to maturity, subject to the terms of the indenture governing the 2024 Notes. (3) The 2030 Senior Notes were issued in June 2020 by Ares Finance Co. II LLC, an indirect subsidiary of the Company, at 99.77% of the face amount with interest paid semi-annually. The Company may redeem the 2030 Senior Notes prior to maturity, subject to the terms of the indenture governing the 2030 Notes. (4) The 2051 Subordinated Notes were issued in June 2021 by Ares Finance Co. III LLC, an indirect subsidiary of the Company, at 100.00% of par with interest paid semi-annually at a fixed-rate of 4.125%. Beginning June 30, 2026, the interest rate will reset on every fifth year based on the five-year U.S. Treasury Rate plus 3.237%. The Company may redeem the 2051 Subordinated Notes prior to maturity or defer interest payments up to five The following table presents the activity of the Company's debt issuance costs: Credit Facility Senior Subordinated Notes Unamortized debt issuance costs as of December 31, 2020 $ 5,232 $ 4,283 $ — Debt issuance costs incurred 1,282 — 5,568 Amortization of debt issuance costs (929) (446) (46) Unamortized debt issuance costs as of September 30, 2021 $ 5,585 $ 3,837 $ 5,522 The following loan obligations were outstanding and classified as liabilities of the Consolidated CLOs: As of September 30, 2021 As of December 31, 2020 Loan Fair Value of Weighted Loan Fair Value of Loan Obligations Weighted Senior secured notes (1) $ 9,577,725 $ 9,561,079 9.5 $ 9,796,442 $ 9,665,804 10.1 Subordinated notes (2) 723,567 613,715 8.3 482,391 292,272 10.2 Total loan obligations of Consolidated CLOs $ 10,301,292 $ 10,174,794 $ 10,278,833 $ 9,958,076 (1) Original borrowings under the senior secured notes totaled $9.6 billion, with various maturity dates ranging from September 2026 to July 2034. The weighted average interest rate as of September 30, 2021 was 1.96%. (2) Original borrowings under the subordinated notes totaled $723.6 million, with various maturity dates ranging from September 2026 to July 2034. The notes do not have contractual interest rates; instead, holders of the notes receive distributions from the excess cash flows generated by each Consolidated CLO. The Consolidated Funds had the following revolving bank credit facilities and term loan outstanding: As of September 30, 2021 As of December 31, 2020 Consolidated Funds' Debt Facilities Maturity Date Total Capacity Outstanding Loan (1) Effective Rate Outstanding Loan (1) Effective Rate Credit Facilities: 3/4/2022 $ 71,500 $ 71,500 1.59% $ 71,500 1.59% 7/1/2023 18,000 17,740 1.63 17,909 1.75 1/15/2022 (2) — — — 32,500 2.75 7/23/2024 75,000 10,000 2.65 N/A N/A 9/24/2026 150,000 — N/A N/A N/A Total borrowings of Consolidated Funds $ 99,240 $ 121,909 (1) The fair values of the borrowings approximate the carrying value as the interest rate on the borrowings is a floating rate. (2) On July 23, 2021, the credit facility was terminated at the Consolidated Fund’s discretion. |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Lease | The tables below present certain supplemental quantitative disclosures regarding the Company's leases: As of September 30, As of December 31, Classification 2021 2020 Operating lease assets Right-of-use operating lease assets $ 176,511 $ 154,742 Finance lease assets Other assets (1) 1,164 1,386 Total lease assets $ 177,675 $ 156,128 Operating lease liabilities Operating lease liabilities $ 214,681 $ 180,236 Finance lease obligations Accounts payable, accrued expenses and other liabilities 977 1,273 Total lease liabilities $ 215,658 $ 181,509 (1) Finance lease assets are recorded net of accumulated amortization of $1.4 million and $1.0 million as of September 30, 2021 and December 31, 2020, respectively. Three months ended September 30, Nine months ended September 30, Classification 2021 2020 2021 2020 Operating lease expense General, administrative and other expenses $ 9,697 $ 7,701 $ 27,203 $ 23,138 Finance lease expense: Amortization of finance lease assets General, administrative and other expenses 154 127 408 346 Interest on finance lease liabilities Interest expense 7 11 24 33 Total lease expense $ 9,858 $ 7,839 $ 27,635 $ 23,517 Nine months ended September 30, Other information 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 26,704 $ 23,098 Operating cash flows for finance leases 34 48 Financing cash flows for finance leases 463 412 Leased assets obtained in exchange for new finance lease liabilities 189 — Leased assets obtained in exchange for new operating lease liabilities 55,461 12,477 As of September 30, As of December 31, Lease term and discount rate 2021 2020 Weighted-average remaining lease terms (in years): Operating leases 6.1 6.0 Finance leases 2.1 2.6 Weighted-average discount rate: Operating leases 2.97 % 3.59 % Finance leases 2.91 % 3.26 % |
Operating Lease, Liability, Maturity | Maturity of lease liabilities Operating Leases Finance Leases 2021 $ 10,591 $ 73 2022 41,989 598 2023 38,277 164 2024 36,579 162 2025 36,251 11 After 2025 66,683 — Total future payments 230,370 1,008 Less: interest 15,689 31 Total lease liabilities $ 214,681 $ 977 |
Finance Lease, Liability, Maturity | Maturity of lease liabilities Operating Leases Finance Leases 2021 $ 10,591 $ 73 2022 41,989 598 2023 38,277 164 2024 36,579 162 2025 36,251 11 After 2025 66,683 — Total future payments 230,370 1,008 Less: interest 15,689 31 Total lease liabilities $ 214,681 $ 977 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
Schedule of Amounts Due from and to Affiliates | The Company considers its professionals and non-consolidated funds to be affiliates. Amounts due from and to affiliates were composed of the following: As of September 30, As of December 31, 2021 2020 Due from affiliates: Management fees receivable from non-consolidated funds $ 347,078 $ 308,581 Incentive fee receivable from non-consolidated funds 579 21,495 Payments made on behalf of and amounts due from non-consolidated funds and employees 145,754 75,811 Due from affiliates—Company $ 493,411 $ 405,887 Amounts due from portfolio companies and non-consolidated funds $ 9,059 $ 17,172 Due from affiliates—Consolidated Funds $ 9,059 $ 17,172 Due to affiliates: Management fee received in advance and rebates payable to non-consolidated funds $ 7,959 $ 4,808 Tax receivable agreement liability 97,698 62,505 Undistributed carried interest and incentive fees 64,675 27,322 Payments made by non-consolidated funds on behalf of and payable by the Company 32,106 5,551 Due to affiliates—Company $ 202,438 $ 100,186 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Antidilutive Securities Excluded from Earnings per Common Unit | The computation of diluted earnings per share for the three and nine months ended September 30, 2021 and 2020 excludes the following restricted units and AOG units, as their effect would have been anti-dilutive: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Restricted units 450 572 167 — AOG Units 119,855,724 114,726,173 115,394,058 — |
Schedule of the Computation of Basic and Diluted Earnings per Common Unit | The following table presents the computation of basic and diluted earnings per common share: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Basic earnings per share of Class A and non-voting common stock: Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 84,726 $ 42,120 $ 262,659 $ 56,605 Distributions on unvested restricted units (1,440) (2,757) (8,142) (7,715) Undistributed earnings allocable to participating unvested restricted units (306) — (2,858) — Net income available to Class A and non-voting common stockholders $ 82,980 $ 39,363 $ 251,659 $ 48,890 Basic weighted-average shares of Class A and non-voting common stock 168,931,621 143,466,209 161,071,151 131,866,471 Basic earnings per share of Class A and non-voting common stock $ 0.49 $ 0.27 $ 1.55 $ 0.37 Diluted earnings per share of Class A and non-voting common stock: Net income available to Class A and non-voting common stockholders $ 84,726 $ 42,120 $ 262,659 $ 56,605 Distributions on unvested restricted units — — — (7,715) Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 84,726 $ 42,120 $ 262,659 $ 48,890 Effect of dilutive shares: Restricted units 12,273,068 9,762,645 10,807,242 — Options 5,317,468 4,893,709 5,265,045 — Diluted weighted-average shares of Class A and non-voting common stock 186,522,157 158,122,563 177,143,438 131,866,471 Diluted earnings per share of Class A and non-voting common stock $ 0.45 $ 0.27 $ 1.48 $ 0.37 Dividend declared and paid per Class A and non-voting common stock $ 0.47 $ 0.40 $ 1.41 $ 1.20 |
EQUITY COMPENSATION (Tables)
EQUITY COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Equity-based Compensation Expense, Net of Assumed Forfeitures | Equity-based compensation expense, net of forfeitures, recorded by the Company is included in the following table: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Restricted units $ 36,390 $ 30,036 $ 127,219 $ 86,804 Restricted units with a market condition 29,601 300 63,925 4,729 Options — — — 43 Equity-based compensation expense $ 65,991 $ 30,336 $ 191,144 $ 91,576 |
Summary of Unvested Restricted Units' Activity | The following table presents unvested restricted units' activity: Restricted Units Weighted Average Balance - January 1, 2021 16,299,664 $ 24.30 Granted 9,667,989 46.16 Vested (6,278,948) 20.70 Forfeited (1,255,502) 30.48 Balance - September 30, 2021 18,433,203 $ 36.33 The following table presents the market condition awards' activity: Market Condition Awards Units Weighted Average Balance - January 1, 2021 — $ — Granted 2,150,000 32.86 Vested (1,925,000) 33.21 Forfeited (225,000) 29.84 Balance - September 30, 2021 — $ — |
Schedule of Weighted Average Assumptions used for Fair Value | Below is a summary of the significant assumptions used to estimate the grant date fair value of market condition awards: Closing price of the Company's common shares as of valuation date $45.76 Risk-free interest rate 0.88% Volatility 35.0% Dividend yield 3.5% Cost of equity 10.0% |
Summary of Unvested Options Activity | A summary of options activity during the nine months ended September 30, 2021 is presented below: Options Weighted Average Exercise Price Weighted Average Aggregate Intrinsic Value Balance - January 1, 2021 8,312,203 $ 18.99 3.4 $ 233,251 Granted — — — — Exercised (1,489,789) 18.94 — — Expired — — — — Forfeited — — — — Balance - September 30, 2021 6,822,414 $ 19.00 2.6 $ 374,073 Exercisable at September 30, 2021 6,822,414 $ 19.00 2.6 $ 374,073 |
EQUITY AND REDEEMABLE INTEREST
EQUITY AND REDEEMABLE INTEREST (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stock by Class | The following table presents the changes in each class of common stock: Class A Common Stock Non-Voting Common Stock Class B Common Stock Class C Common Stock Total Balance - January 1, 2021 147,182,562 — 1,000 112,447,618 259,631,180 Issuance of stock (1) 12,159,200 3,489,911 — 8,744,296 24,393,407 Exchanges of AOG Units 2,330,367 — — (2,330,367) — Redemptions of AOG Units — — — (58,290) (58,290) Stock option exercises, net of shares withheld for tax 1,460,388 — — — 1,460,388 Vesting of restricted stock awards, net of shares withheld for tax 4,448,648 — — — 4,448,648 Balance - September 30, 2021 167,581,165 3,489,911 1,000 118,803,257 289,875,333 (1) Issuances of Class C Common stock corresponds with increases in Ares Owners Holdings L.P.’s ownership interest in the AOG entities. |
Schedule of Ownership Interests | The following table presents each partner's AOG Units and corresponding ownership interest in each of the Ares Operating Group entities, as well as its daily average ownership of AOG Units in each of the Ares Operating Group entities: Daily Average Ownership As of September 30, 2021 As of December 31, 2020 Three months ended September 30, Nine months ended September 30, AOG Units Direct Ownership Interest AOG Units Direct Ownership Interest 2021 2020 2021 2020 Ares Management Corporation 171,071,076 59.02 % 147,182,562 56.69 % 58.50 % 55.57 % 58.26 % 53.33 % Ares Owners Holdings, L.P. 118,803,257 40.98 112,447,618 43.31 41.50 44.43 41.74 46.67 Total 289,874,333 100.00 % 259,630,180 100.00 % |
Schedule of Redeemable Interests | Redeemable Interest The following table summarizes the activities associated with the redeemable interest in Ares Operating Group entities: Total Balance - January 1, 2021 $ 100,366 Net income 32 Currency translation adjustment, net of tax (590) Balance- March 31, 2021 $ 99,808 Net income $ 337 Currency translation adjustment, net of tax 186 Distribution (300) Balance- June 30, 2021 $ 100,031 Net income $ 324 Currency translation adjustment, net of tax (356) Distribution (1,350) Balance- September 30, 2021 $ 98,649 The following table summarizes the activities associated with the redeemable interest in Consolidated Funds: Total Balance - January 1, 2021 $ — Redemption value 930,924 Balance- March 31, 2021 $ 930,924 Change in redemption value (14,100) Balance- June 30, 2021 $ 916,824 Change in redemption value 83,176 Balance- September 30, 2021 $ 1,000,000 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Financial Results for Company's Operating Segments, as well as the OMG | The following tables present the financial results for the Company’s operating segments, as well as the OMG: Three months ended September 30, 2021 Credit Group Private Equity Group Real Secondary Solutions Group Strategic Initiatives Total OMG Total Management fees $ 271,591 $ 69,591 $ 55,160 $ 41,064 16,544 $ 453,950 $ — $ 453,950 Other fees 5,798 370 3,681 — 2 9,851 3,446 13,297 Compensation and benefits (86,502) (26,773) (29,160) (11,955) (5,316) (159,706) (66,107) (225,813) General, administrative and other expenses (14,930) (6,238) (5,420) (2,593) (1,774) (30,955) (28,142) (59,097) Fee related earnings 175,957 36,950 24,261 26,516 9,456 273,140 (90,803) 182,337 Performance income—realized 6,332 34,316 4,693 — — 45,341 — 45,341 Performance related compensation—realized (3,079) (27,483) (3,166) — — (33,728) — (33,728) Realized net performance income 3,253 6,833 1,527 — — 11,613 — 11,613 Investment income—realized 618 2,020 1,699 — 1,025 5,362 — 5,362 Interest and other investment income (expense)—realized 4,716 4,861 918 699 163 11,357 (270) 11,087 Interest expense (2,392) (2,726) (1,683) (427) (4,135) (11,363) (160) (11,523) Realized net investment income (loss) 2,942 4,155 934 272 (2,947) 5,356 (430) 4,926 Realized income $ 182,152 $ 47,938 $ 26,722 $ 26,788 $ 6,509 $ 290,109 $ (91,233) $ 198,876 Three months ended September 30, 2020 Credit Group Private Equity Group Real Secondary Solutions Group Strategic Initiatives Total OMG Total Management fees $ 208,371 $ 54,653 $ 23,787 $ — $ 13,320 $ 300,131 $ — $ 300,131 Other fees 4,898 2 5 — 6 4,911 — 4,911 Compensation and benefits (74,373) (21,224) (13,011) — (4,241) (112,849) (41,551) (154,400) General, administrative and other expenses (13,789) (6,002) (2,987) — (1,514) (24,292) (19,519) (43,811) Fee related earnings 125,107 27,429 7,794 — 7,571 167,901 (61,070) 106,831 Performance income—realized 7,069 115,997 199 — — 123,265 — 123,265 Performance related compensation—realized (4,131) (93,284) (123) — — (97,538) — (97,538) Realized net performance income 2,938 22,713 76 — — 25,727 — 25,727 Investment income—realized — 16,351 486 — — 16,837 — 16,837 Interest and other investment income (expense)—realized 1,962 1,065 1,308 — (4) 4,331 (503) 3,828 Interest expense (2,340) (2,216) (1,389) — (729) (6,674) (141) (6,815) Realized net investment income (loss) (378) 15,200 405 — (733) 14,494 (644) 13,850 Realized income $ 127,667 $ 65,342 $ 8,275 $ — $ 6,838 $ 208,122 $ (61,714) $ 146,408 Nine months ended September 30, 2021 Credit Group Private Equity Group Real Secondary Solutions Group Strategic Initiatives Total OMG Total Management fees $ 764,702 $ 171,019 $ 115,602 $ 53,962 $ 48,963 $ 1,154,248 $ — $ 1,154,248 Other fees 18,494 726 4,604 — 82 23,906 3,446 27,352 Compensation and benefits (252,783) (73,534) (60,767) (16,244) (15,440) (418,768) (158,943) (577,711) General, administrative and other expenses (37,716) (17,499) (12,064) (3,452) (5,580) (76,311) (69,872) (146,183) Fee related earnings 492,697 80,712 47,375 34,266 28,025 683,075 (225,369) 457,706 Performance income—realized 78,255 159,479 12,255 — — 249,989 — 249,989 Performance related compensation—realized (49,433) (127,706) (8,167) — — (185,306) — (185,306) Realized net performance income 28,822 31,773 4,088 — — 64,683 — 64,683 Investment income—realized 1,858 5,308 4,182 — 1,347 12,695 — 12,695 Interest and other investment income—realized 14,354 10,716 3,892 701 2,824 32,487 170 32,657 Interest expense (5,372) (6,032) (3,930) (432) (8,962) (24,728) (397) (25,125) Realized net investment income (loss) 10,840 9,992 4,144 269 (4,791) 20,454 (227) 20,227 Realized income $ 532,359 $ 122,477 $ 55,607 $ 34,535 $ 23,234 $ 768,212 $ (225,596) $ 542,616 Nine months ended September 30, 2020 Credit Group Private Equity Group Real Estate Group Secondary Solutions Group Strategic Initiatives Total OMG Total Management fees $ 606,596 $ 160,206 $ 71,459 $ — $ 13,320 $ 851,581 $ — $ 851,581 Other fees 12,057 142 716 — 6 12,921 — 12,921 Compensation and benefits (222,063) (62,946) (38,159) — (4,241) (327,409) (114,916) (442,325) General, administrative and other expenses (41,626) (16,083) (9,185) — (1,514) (68,408) (56,877) (125,285) Fee related earnings 354,964 81,319 24,831 — 7,571 468,685 (171,793) 296,892 Performance income—realized 16,085 276,469 27,106 — — 319,660 — 319,660 Performance related compensation—realized (12,142) (222,949) (17,484) — — (252,575) — (252,575) Realized net performance income 3,943 53,520 9,622 — — 67,085 — 67,085 Investment income (loss)—realized (843) 35,866 2,740 — — 37,763 (5,698) 32,065 Interest and other investment income (expense)—realized 13,166 2,364 3,024 — (4) 18,550 (588) 17,962 Interest expense (6,391) (6,106) (3,715) — (729) (16,941) (1,262) (18,203) Realized net investment income (loss) 5,932 32,124 2,049 — (733) 39,372 (7,548) 31,824 Realized income $ 364,839 $ 166,963 $ 36,502 $ — $ 6,838 $ 575,142 $ (179,341) $ 395,801 |
Schedule of Segment’ Revenue, Expenses and Realized Net Investment Income | The following table presents the components of the Company’s operating segments’ revenue, expenses and realized net investment income: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Segment revenues Management fees $ 453,950 $ 300,131 $ 1,154,248 $ 851,581 Other fees 9,851 4,911 23,906 12,921 Performance income—realized 45,341 123,265 249,989 319,660 Total segment revenues $ 509,142 $ 428,307 $ 1,428,143 $ 1,184,162 Segment expenses Compensation and benefits $ 159,706 $ 112,849 $ 418,768 $ 327,409 General, administrative and other expenses 30,955 24,292 76,311 68,408 Performance related compensation—realized 33,728 97,538 185,306 252,575 Total segment expenses $ 224,389 $ 234,679 $ 680,385 $ 648,392 Segment realized net investment income Investment income—realized $ 5,362 $ 16,837 $ 12,695 $ 37,763 Interest and other investment income —realized 11,357 4,331 32,487 18,550 Interest expense (11,363) (6,674) (24,728) (16,941) Total segment realized net investment income $ 5,356 $ 14,494 $ 20,454 $ 39,372 |
Schedule of Segment Revenues Components | The following table reconciles the Company's consolidated revenues to segment revenue: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Total consolidated revenue $ 948,719 $ 489,866 $ 2,901,926 $ 1,106,033 Performance (income) loss—unrealized (415,317) (52,488) (1,381,697) 77,866 Management fees of Consolidated Funds eliminated in consolidation 11,051 11,719 33,416 33,601 Incentive fees of Consolidated Funds eliminated in consolidation — — 1,528 (70) Administrative, transaction and other fees of Consolidated Funds eliminated in consolidation 4,264 4,448 13,157 12,249 Administrative fees (1) (15,632) (9,216) (34,754) (27,715) OMG revenue (3,446) — (3,446) — Performance income (loss) reclass (2) 680 (291) 1,285 (3,664) Principal investment income, net of eliminations (14,250) (11,408) (86,477) (8,330) Net income of non-controlling interests in consolidated subsidiaries (6,927) (4,323) (16,795) (5,808) Total consolidation adjustments and reconciling items (439,577) (61,559) (1,473,783) 78,129 Total segment revenue $ 509,142 $ 428,307 $ 1,428,143 $ 1,184,162 (1) Represents administrative fees that are presented in administrative, transaction and other fees in the Company’s Condensed Consolidated Statements of Operations and are netted against the respective expenses for segment reporting. (2) Related to performance income for AREA Sponsor Holdings LLC, an investment pool. Changes in value of this investment are reflected within net realized and unrealized gains (losses) on investments in the Company’s Condensed Consolidated Statements of Operations. |
Schedule of Segment Expenses Components | The following table reconciles the Company's consolidated expenses to segment expenses: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Total consolidated expenses $ 813,267 $ 392,580 $ 2,363,108 $ 958,106 Performance related compensation-unrealized (296,044) (24,818) (1,022,393) 61,010 Expenses of Consolidated Funds added in consolidation (23,206) (17,737) (66,653) (50,237) Expenses of Consolidated Funds eliminated in consolidation 11,102 11,718 35,078 33,531 Administrative fees (1) (15,632) (9,216) (34,754) (27,715) OMG expenses (94,249) (61,070) (228,815) (171,793) Acquisition and merger-related expense (754) (3,474) (18,364) (9,430) Equity compensation expense (65,991) (30,336) (191,144) (91,576) Acquisition-related compensation expense (2) (28,194) — (32,824) — Deferred placement fees (32,413) (2,942) (33,740) (18,677) Depreciation and amortization expense (36,668) (14,336) (71,742) (26,197) Expense of non-controlling interests in consolidated subsidiaries (6,829) (5,690) (17,372) (8,630) Total consolidation adjustments and reconciling items (588,878) (157,901) (1,682,723) (309,714) Total segment expenses $ 224,389 $ 234,679 $ 680,385 $ 648,392 (1) Represents administrative fees that are presented in administrative, transaction and other fees in the Company’s Condensed Consolidated Statements of Operations and are netted against the respective expenses for segment reporting. (2) Represents compensation expense associated with contingent obligations recorded in connection with the Landmark Acquisition and the Black Creek Acquisition and is presented in compensation and benefits in the Company’s Condensed Consolidated Statements of Operations. |
Schedule of Segment Other Income (Expense) Components | The following table reconciles the Company's consolidated other income to segment realized net investment income: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Total consolidated other income (expense) $ 111,536 $ 62,355 $ 218,011 $ (43,602) Investment (income) loss—unrealized (3,609) 1,479 (60,588) 83,369 Interest and other investment (income) loss—unrealized (1,405) (1,390) 3,057 (10,330) Other (income) loss from Consolidated Funds added in consolidation, net (76,287) (68,132) (178,195) 20,719 Other expense from Consolidated Funds eliminated in consolidation, net (4,973) (3,470) (13,783) (11,478) OMG other (income) expense 37 (1,820) 646 (781) Performance (income) loss reclass (1) (680) 291 (1,285) 3,664 Principal investment income (loss) 20,719 18,080 96,448 (24,951) Other (income) expense, net (34,812) 9,534 (34,666) 9,903 Other (income) loss of non-controlling interests in consolidated subsidiaries (5,170) (2,433) (9,191) 12,859 Total consolidation adjustments and reconciling items (106,180) (47,861) (197,557) 82,974 Total segment realized net investment income $ 5,356 $ 14,494 $ 20,454 $ 39,372 (1) Related to performance income for AREA Sponsor Holdings LLC. Changes in value of this investment are reflected within net realized and unrealized gains (losses) on investments in the Company’s Condensed Consolidated Statements of Operations. |
Reconciliation of Segment Results to the Company's Income before Taxes and Total Assets | The following table presents the reconciliation of income before taxes as reported in the Condensed Consolidated Statements of Operations to segment results of RI and FRE: Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Income before taxes $ 246,988 $ 159,641 $ 756,829 $ 104,325 Adjustments: Depreciation and amortization expense 36,668 14,336 71,742 26,197 Equity compensation expense 65,991 30,336 191,144 91,576 Acquisition-related compensation expense (1) 28,194 — 32,824 — Acquisition and merger-related expense 7,967 3,490 26,188 9,815 Deferred placement fees 32,413 2,942 33,740 18,677 OMG expense, net 90,840 59,250 226,015 171,012 Other (income) expense, net (42,025) 9,518 (42,490) 9,518 Net (income) expense of non-controlling interests in consolidated subsidiaries (5,268) (1,066) (8,614) 15,681 (Income) loss before taxes of non-controlling interests in Consolidated Funds, net of eliminations (47,372) (42,744) (102,331) 38,446 Total performance (income) loss—unrealized (415,317) (52,488) (1,381,697) 77,866 Total performance related compensation—unrealized 296,044 24,818 1,022,393 (61,010) Total investment (income) loss—unrealized (5,014) 89 (57,531) 73,039 Realized income 290,109 208,122 768,212 575,142 Total performance income—realized (45,341) (123,265) (249,989) (319,660) Total performance related compensation—realized 33,728 97,538 185,306 252,575 Total investment income—realized (5,356) (14,494) (20,454) (39,372) Fee related earnings $ 273,140 $ 167,901 $ 683,075 $ 468,685 (1) Represents compensation expense associated with contingent obligations recorded in connection with the Landmark Acquisition and the Black Creek Acquisition and is presented in compensation and benefits in the Company’s Condensed Consolidated Statements of Operations. |
CONSOLIDATION (Tables)
CONSOLIDATION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule of Interest in VIEs | The Company's interests in consolidated and non-consolidated VIEs, as presented in the Condensed Consolidated Statements of Financial Condition, and its respective maximum exposure to loss relating to non-consolidated VIEs are as follows: As of September 30, As of December 31, 2021 2020 Maximum exposure to loss attributable to the Company's investment in non-consolidated VIEs (1) $ 340,988 $ 224,203 Maximum exposure to loss attributable to the Company's investment in consolidated VIEs (1) 478,164 391,963 Assets of consolidated VIEs 12,190,617 11,580,003 Liabilities of consolidated VIEs 11,238,928 10,716,438 (1) As of September 30, 2021 and December 31, 2020, the Company's maximum exposure of loss for CLO securities was equal to the cumulative fair value of our capital interest in CLOs that are managed and totaled $104.4 million and $107.7 million, respectively. Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Net income (loss) attributable to non-controlling interests related to consolidated VIEs $ 38,597 $ 42,627 $ 84,285 $ (38,593) |
Schedule of Consolidating Effects of the Consolidated Funds on the Company's Financial Condition | The following supplemental financial information illustrates the consolidating effects of the Consolidated Funds on the Company's financial condition, results from operations and cash flows: As of September 30, 2021 Consolidated Consolidated Eliminations Consolidated Assets Cash and cash equivalents $ 295,704 $ — $ — $ 295,704 Investments (includes $2,625,319 of accrued carried interest) 3,804,023 — (481,358) 3,322,665 Due from affiliates 517,504 — (24,093) 493,411 Other assets 1,006,870 — — 1,006,870 Intangible assets, net 1,452,690 — — 1,452,690 Right-of-use operating lease assets 176,511 — — 176,511 Assets of Consolidated Funds Cash and cash equivalents — 1,581,433 — 1,581,433 U.S. Treasury securities, at fair value — 1,000,165 — 1,000,165 Investments, at fair value — 10,356,640 4,214 10,360,854 Due from affiliates — 19,089 (10,030) 9,059 Receivable for securities sold — 187,230 — 187,230 Other assets — 47,806 — 47,806 Total assets $ 7,253,302 $ 13,192,363 $ (511,267) $ 19,934,398 Liabilities Accounts payable, accrued expenses and other liabilities $ 218,171 $ — $ (10,030) $ 208,141 Accrued compensation 309,569 — — 309,569 Due to affiliates 202,438 — — 202,438 Performance related compensation payable 1,895,343 — — 1,895,343 Debt obligations 1,238,325 — — 1,238,325 Operating lease liabilities 214,681 — — 214,681 Liabilities of Consolidated Funds Accounts payable, accrued expenses and other liabilities — 102,883 (13,198) 89,685 Due to affiliates — 19,880 (19,880) — Payable for securities purchased — 863,007 — 863,007 CLO loan obligations, at fair value — 10,220,040 (45,246) 10,174,794 Fund borrowings — 99,240 — 99,240 Total liabilities 4,078,527 11,305,050 (88,354) 15,295,223 Commitments and contingencies Redeemable interest in Consolidated Funds — 1,000,000 — 1,000,000 Redeemable interest in Ares Operating Group entities 98,649 — — 98,649 Non-controlling interest in Consolidated Funds — 887,313 (422,913) 464,400 Non-controlling interest in Ares Operating Group entities 1,322,866 — — 1,322,866 Stockholders' Equity Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (zero shares issued and outstanding) — — — — Class A common stock, $0.01 par value, 1,500,000,000 shares authorized (167,581,165 shares issued and outstanding) 1,676 — — 1,676 Non-voting common stock, $0.01 par value, 500,000,000 shares authorized (3,489,911 shares issued and outstanding) 35 — — 35 Class B common stock, $0.01 par value, 1,000 shares authorized (1,000 shares issued and outstanding) — — — — Class C common stock, $0.01 par value, 499,999,000 shares authorized (118,803,257 shares issued and outstanding) 1,188 — — 1,188 Additional paid-in-capital 1,881,913 — — 1,881,913 Retained earnings (128,981) — — (128,981) Accumulated other comprehensive loss, net of tax (2,571) — — (2,571) Total stockholders' equity 1,753,260 — — 1,753,260 Total equity 3,076,126 887,313 (422,913) 3,540,526 Total liabilities, redeemable interest, non-controlling interests and equity $ 7,253,302 $ 13,192,363 $ (511,267) $ 19,934,398 As of December 31, 2020 Consolidated Consolidated Eliminations Consolidated Assets Cash and cash equivalents $ 539,812 $ — $ — $ 539,812 Investments (includes $1,145,853 of accrued carried interest) 2,064,517 — (381,758) 1,682,759 Due from affiliates 426,021 — (20,134) 405,887 Other assets 590,543 — (211) 590,332 Intangible assets, net 222,087 — — 222,087 Right-of-use operating lease assets 154,742 — — 154,742 Assets of Consolidated Funds Cash and cash equivalents — 522,377 — 522,377 Investments, at fair value — 10,873,522 3,575 10,877,097 Due from affiliates — 27,377 (10,205) 17,172 Receivable for securities sold — 121,225 — 121,225 Other assets — 35,502 — 35,502 Total assets $ 3,997,722 $ 11,580,003 $ (408,733) $ 15,168,992 Liabilities Accounts payable, accrued expenses and other liabilities $ 125,494 $ — $ (10,205) $ 115,289 Accrued compensation 103,010 — — 103,010 Due to affiliates 100,186 — — 100,186 Performance related compensation payable 813,378 — — 813,378 Debt obligations 642,998 — — 642,998 Operating lease liabilities 180,236 — — 180,236 Liabilities of Consolidated Funds Accounts payable, accrued expenses and other liabilities — 46,824 — 46,824 Due to affiliates — 16,770 (16,770) — Payable for securities purchased — 514,946 — 514,946 CLO loan obligations — 10,015,989 (57,913) 9,958,076 Fund borrowings — 121,909 — 121,909 Total liabilities 1,965,302 10,716,438 (84,888) 12,596,852 Commitments and contingencies Redeemable interest in Ares Operating Group entities 100,366 — — 100,366 Non-controlling interest in Consolidated Funds — 863,565 (323,845) 539,720 Non-controlling interest in Ares Operating Group entities 738,369 — — 738,369 Stockholders' Equity Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (12,400,000 shares issued and outstanding) 298,761 — — 298,761 Class A common stock, $0.01 par value, 1,500,000,000 shares authorized (147,182,562 shares issued and outstanding) 1,472 — — 1,472 Class B common stock, $0.01 par value, 1,000 shares authorized (1,000 shares issued and outstanding) — — — — Class C common stock, $0.01 par value, 499,999,000 shares authorized (112,447,618 share issued and outstanding) 1,124 — — 1,124 Additional paid-in-capital 1,043,669 — — 1,043,669 Retained earnings (151,824) — — (151,824) Accumulated other comprehensive income, net of tax 483 — — 483 Total stockholders' equity 1,193,685 — — 1,193,685 Total equity 1,932,054 863,565 (323,845) 2,471,774 Total liabilities, redeemable interest, non-controlling interests and equity $ 3,997,722 $ 11,580,003 $ (408,733) $ 15,168,992 |
Schedule of Results from Operations | Three months ended September 30, 2021 Consolidated Consolidated Eliminations Consolidated Revenues Management fees $ 459,313 $ — $ (11,051) $ 448,262 Carried interest allocation 460,651 — — 460,651 Incentive fees 696 — — 696 Principal investment income 20,719 — (6,469) 14,250 Administrative, transaction and other fees 29,124 — (4,264) 24,860 Total revenues 970,503 — (21,784) 948,719 Expenses Compensation and benefits 335,569 — — 335,569 Performance related compensation 331,141 — — 331,141 General, administrative and other expense 134,453 — — 134,453 Expenses of the Consolidated Funds — 23,206 (11,102) 12,104 Total expenses 801,163 23,206 (11,102) 813,267 Other income (expense) Net realized and unrealized gains on investments 2,759 — 5,575 8,334 Interest and dividend income 2,702 — (1,326) 1,376 Interest expense (11,523) — — (11,523) Other income, net 36,338 — 316 36,654 Net realized and unrealized gains on investments of the Consolidated Funds — 36,695 (2,450) 34,245 Interest and other income of the Consolidated Funds — 104,344 (316) 104,028 Interest expense of the Consolidated Funds — (64,752) 3,174 (61,578) Total other income 30,276 76,287 4,973 111,536 Income before taxes 199,616 53,081 (5,709) 246,988 Income tax expense 30,273 2 — 30,275 Net income 169,343 53,079 (5,709) 216,713 Less: Net income attributable to non-controlling interests in Consolidated Funds — 53,079 (5,709) 47,370 Net income attributable to Ares Operating Group entities 169,343 — — 169,343 Less: Net income attributable to redeemable interest in Ares Operating Group entities 324 — — 324 Less: Net income attributable to non-controlling interests in Ares Operating Group entities 84,293 — — 84,293 Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 84,726 $ — $ — $ 84,726 Three months ended September 30, 2020 Consolidated Consolidated Eliminations Consolidated Revenues Management fees $ 304,153 $ — $ (11,719) $ 292,434 Carried interest allocation 168,978 — — 168,978 Incentive fees 7,194 — — 7,194 Principal investment income 18,080 — (6,672) 11,408 Administrative, transaction and other fees 14,300 — (4,448) 9,852 Total revenues 512,705 — (22,839) 489,866 Expenses Compensation and benefits 194,267 — — 194,267 Performance related compensation 122,356 — — 122,356 General, administrative and other expense 69,938 — — 69,938 Expenses of the Consolidated Funds — 17,737 (11,718) 6,019 Total expenses 386,561 17,737 (11,718) 392,580 Other income (expense) Net realized and unrealized gains (losses) on investments 2,303 — (4,910) (2,607) Interest and dividend income 1,602 — (258) 1,344 Interest expense (6,815) — — (6,815) Other income (expense), net (6,337) — 8,540 2,203 Net realized and unrealized gains on investments of the Consolidated Funds — 9,850 8,121 17,971 Interest and other income of the Consolidated Funds — 126,100 (9,519) 116,581 Interest expense of the Consolidated Funds — (67,818) 1,496 (66,322) Total other income (expense) (9,247) 68,132 3,470 62,355 Income before taxes 116,897 50,395 (7,651) 159,641 Income tax expense 18,197 117 — 18,314 Net income 98,700 50,278 (7,651) 141,327 Less: Net income attributable to non-controlling interests in Consolidated Funds — 50,278 (7,651) 42,627 Net income attributable to Ares Operating Group entities 98,700 — — 98,700 Less: Net loss attributable to redeemable interest in Ares Operating Group entities (1,007) — — (1,007) Less: Net income attributable to non-controlling interests in Ares Operating Group entities 52,162 — — 52,162 Net income attributable to Ares Management Corporation 47,545 — — 47,545 Less: Series A Preferred Stock dividends paid 5,425 — — 5,425 Net income attributable to Ares Management Corporation Class A common stockholders $ 42,120 $ — $ — $ 42,120 Nine months ended September 30, 2021 Consolidated Consolidated Eliminations Consolidated Revenues Management fees $ 1,169,237 $ — $ (33,416) $ 1,135,821 Carried interest allocation 1,610,707 — — 1,610,707 Incentive fees 20,948 — (1,528) 19,420 Principal investment income 96,448 — (9,971) 86,477 Administrative, transaction and other fees 62,658 — (13,157) 49,501 Total revenues 2,959,998 — (58,072) 2,901,926 Expenses Compensation and benefits 837,108 — — 837,108 Performance related compensation 1,208,954 — — 1,208,954 General, administrative and other expense 285,471 — — 285,471 Expenses of the Consolidated Funds — 66,653 (35,078) 31,575 Total expenses 2,331,533 66,653 (35,078) 2,363,108 Other income (expense) Net realized and unrealized gains on investments 10,602 — 8,142 18,744 Interest and dividend income 9,695 — (2,877) 6,818 Interest expense (25,125) — — (25,125) Other income, net 30,861 — (175) 30,686 Net realized and unrealized gains on investments of the Consolidated Funds — 46,541 (1,821) 44,720 Interest and other income of the Consolidated Funds — 333,570 175 333,745 Interest expense of the Consolidated Funds — (201,916) 10,339 (191,577) Total other income 26,033 178,195 13,783 218,011 Income before taxes 654,498 111,542 (9,211) 756,829 Income tax expense 104,411 76 — 104,487 Net income 550,087 111,466 (9,211) 652,342 Less: Net income attributable to non-controlling interests in Consolidated Funds — 111,466 (9,211) 102,255 Net income attributable to Ares Operating Group entities 550,087 — — 550,087 Less: Net income attributable to redeemable interest in Ares Operating Group entities 693 — — 693 Less: Net income attributable to non-controlling interests in Ares Operating Group entities 264,646 — — 264,646 Net income attributable to Ares Management Corporation 284,748 — — 284,748 Less: Series A Preferred Stock dividends paid 10,850 — — 10,850 Less: Series A Preferred Stock redemption premium 11,239 — — 11,239 Net income attributable to Ares Management Corporation Class A and non-voting common stockholders $ 262,659 $ — $ — $ 262,659 Nine months ended September 30, 2020 Consolidated Consolidated Eliminations Consolidated Revenues Management fees $ 856,751 $ — $ (33,601) $ 823,150 Carried interest allocation 241,380 — — 241,380 Incentive fees 4,206 — 70 4,276 Principal investment income (loss) (24,951) — 33,281 8,330 Administrative, transaction and other fees 41,146 — (12,249) 28,897 Total revenues 1,118,532 — (12,499) 1,106,033 Expenses Compensation and benefits 559,482 — — 559,482 Performance related compensation 191,565 — — 191,565 General, administrative and other expense 190,353 — — 190,353 Expenses of the Consolidated Funds — 50,237 (33,531) 16,706 Total expenses 941,400 50,237 (33,531) 958,106 Other income (expense) Net realized and unrealized losses on investments (25,360) — 15,009 (10,351) Interest and dividend income 8,102 — (2,990) 5,112 Interest expense (18,203) — — (18,203) Other income, net 1,100 — 8,748 9,848 Net realized and unrealized losses on investments of the Consolidated Funds — (148,826) (4,442) (153,268) Interest and other income of the Consolidated Funds — 355,639 (9,519) 346,120 Interest expense of the Consolidated Funds — (227,532) 4,672 (222,860) Total other expense (34,361) (20,719) 11,478 (43,602) Income (loss) before taxes 142,771 (70,956) 32,510 104,325 Income tax expense 21,972 147 — 22,119 Net income (loss) 120,799 (71,103) 32,510 82,206 Less: Net loss attributable to non-controlling interests in Consolidated Funds — (71,103) 32,510 (38,593) Net income attributable to Ares Operating Group entities 120,799 — — 120,799 Less: Net loss attributable to redeemable interest in Ares Operating Group entities (1,007) — — (1,007) Less: Net income attributable to non-controlling interests in Ares Operating Group entities 48,926 — — 48,926 Net income attributable to Ares Management Corporation 72,880 — — 72,880 Less: Series A Preferred Stock dividends paid 16,275 — — 16,275 Net income attributable to Ares Management Corporation Class A common stockholders $ 56,605 $ — $ — $ 56,605 |
Schedule of Cash Flows | Nine months ended September 30, 2021 Consolidated Consolidated Eliminations Consolidated Cash flows from operating activities: Net income $ 550,087 $ 111,466 $ (9,211) $ 652,342 Adjustments to reconcile net income to net cash provided by (used in) operating activities (28,467) — 99,600 71,133 Adjustments to reconcile net income to net cash used in operating activities allocable to non-controlling interests in Consolidated Funds — (1,697,529) 9,444 (1,688,085) Cash flows due to changes in operating assets and liabilities (153,361) — 3,923 (149,438) Cash flows due to changes in operating assets and liabilities allocable to redeemable and non-controlling interest in Consolidated Funds — 343,253 (1,072,956) (729,703) Net cash provided by (used in) operating activities 368,259 (1,242,810) (969,200) (1,843,751) Cash flows from investing activities: Purchase of furniture, equipment and leasehold improvements, net of disposals (15,152) — — (15,152) Acquisitions, net of cash acquired (1,057,426) — — (1,057,426) Net cash used in investing activities (1,072,578) — — (1,072,578) Cash flows from financing activities: Net proceeds from issuance of Class A and non-voting common stock 827,430 — — 827,430 Proceeds from Credit Facility 468,000 — — 468,000 Proceeds from subordinated notes 450,000 — — 450,000 Repayments of Credit Facility (318,000) — — (318,000) Dividends and distributions (438,568) — — (438,568) Series A Preferred Stock dividends (10,850) — — (10,850) Redemption of Series A Preferred Stock (310,000) — — (310,000) Stock option exercises 27,409 — — 27,409 Taxes paid related to net share settlement of equity awards (221,287) — — (221,287) Other financing activities 1,976 — — 1,976 Allocable to redeemable and non-controlling interests in Consolidated Funds: Contributions from redeemable and non-controlling interests in Consolidated Funds — 1,027,454 (107,788) 919,666 Distributions to non-controlling interests in Consolidated Funds — (102,701) 17,931 (84,770) Borrowings under loan obligations by Consolidated Funds — 1,456,887 — 1,456,887 Repayments under loan obligations by Consolidated Funds — (74,909) — (74,909) Net cash provided by financing activities 476,110 2,306,731 (89,857) 2,692,984 Effect of exchange rate changes (15,899) (4,864) — (20,763) Net change in cash and cash equivalents (244,108) 1,059,057 (1,059,057) (244,108) Cash and cash equivalents, beginning of period 539,812 522,377 (522,377) 539,812 Cash and cash equivalents, end of period $ 295,704 $ 1,581,434 $ (1,581,434) $ 295,704 Supplemental disclosure of non-cash financing activities: Issuance of AOG Units in connection with acquisitions $ 511,069 $ — $ — $ 511,069 Nine months ended September 30, 2020 Consolidated Consolidated Eliminations Consolidated Cash flows from operating activities: Net income (loss) $ 120,799 $ (71,103) $ 32,510 $ 82,206 Adjustments to reconcile net income to net cash provided by operating activities 207,358 — (22,772) 184,586 Adjustments to reconcile net income to net cash used in operating activities allocable to non-controlling interests in Consolidated Funds — (733,607) (32,792) (766,399) Cash flows due to changes in operating assets and liabilities 152,691 — (6,989) 145,702 Cash flows due to changes in operating assets and liabilities allocable to non-controlling interest in Consolidated Funds — 105,992 260,375 366,367 Net cash provided by (used in) operating activities 480,848 (698,718) 230,332 12,462 Cash flows from investing activities: Purchase of furniture, equipment and leasehold improvements, net of disposals (8,608) — — (8,608) Cash paid for asset acquisition (117,829) — — (117,829) Net cash used in investing activities (126,437) — — (126,437) Cash flows from financing activities: Proceeds from issuance of Class A common stock 383,154 — — 383,154 Proceeds from Credit Facility 790,000 — — 790,000 Proceeds from Senior Notes 399,084 — — 399,084 Repayments of Credit Facility (860,000) — — (860,000) Dividends and distributions (334,957) — — (334,957) Series A Preferred Stock dividends (16,275) — — (16,275) Stock option exercises 78,959 — — 78,959 Taxes paid related to net share settlement of equity awards (75,657) — — (75,657) Other financing activities (4,137) — — (4,137) Allocable to non-controlling interests in Consolidated Funds: Contributions from non-controlling interests in Consolidated Funds — 138,760 (15,047) 123,713 Distributions to non-controlling interests in Consolidated Funds — (195,598) 25,851 (169,747) Borrowings under loan obligations by Consolidated Funds — 618,207 — 618,207 Repayments under loan obligations by Consolidated Funds — (104,794) — (104,794) Net cash provided by financing activities 360,171 456,575 10,804 827,550 Effect of exchange rate changes 15,786 1,007 — 16,793 Net change in cash and cash equivalents 730,368 (241,137) 241,137 730,368 Cash and cash equivalents, beginning of period 138,384 606,321 (606,321) 138,384 Cash and cash equivalents, end of period $ 868,752 $ 365,185 $ (365,185) $ 868,752 Supplemental disclosure of non-cash financing activities Issuance of Class A common stock in connection with acquisitions $ 305,388 $ — $ — $ 305,338 |
ORGANIZATION (Details)
ORGANIZATION (Details) $ in Billions | 1 Months Ended | |
Feb. 28, 2021USD ($) | Feb. 21, 2020contract | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Proceeds from IPO | $ | $ 1 | |
Number of collateral management contracts acquired | contract | 7 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - shares | Sep. 30, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | ||
Common stock, shares outstanding (in shares) | 289,875,333 | 259,631,180 |
Class A Common Stock | ||
Class of Stock [Line Items] | ||
Common stock, shares outstanding (in shares) | 167,581,165 | 147,182,562 |
Class A Common Stock | Ares Acquisition Corporation | ||
Class of Stock [Line Items] | ||
Common stock, shares outstanding (in shares) | 100,000,000 |
BUSINESS COMBINATIONS - Narrati
BUSINESS COMBINATIONS - Narrative (Details) - USD ($) $ in Thousands | Jul. 01, 2021 | Jun. 02, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Asset Acquisition [Line Items] | ||||||||
Acquisition and merger-related expense | $ 4,900 | |||||||
Goodwill | $ 417,700 | $ 787,750 | $ 787,750 | $ 787,750 | $ 371,047 | |||
Total revenues | 54,000 | |||||||
Net income | $ 26,800 | |||||||
Landmark Acquisition | ||||||||
Asset Acquisition [Line Items] | ||||||||
Business combination equity interest in acquiree, percentage | 100.00% | |||||||
Business combination, consideration transferred | $ 1,103,469 | |||||||
Goodwill | 417,665 | |||||||
Total revenues | 948,719 | $ 527,105 | 2,966,540 | $ 1,214,989 | ||||
Net income | $ 87,542 | $ 37,570 | $ 257,361 | $ 41,263 | ||||
Landmark Acquisition | Management contracts | ||||||||
Asset Acquisition [Line Items] | ||||||||
Acquisition and merger-related expense | $ 425,900 | |||||||
Acquired finite lived intangible assets useful life | 7 years 4 months 24 days | |||||||
Landmark Acquisition | Client relationships | ||||||||
Asset Acquisition [Line Items] | ||||||||
Acquisition and merger-related expense | $ 197,200 | |||||||
Acquired finite lived intangible assets useful life | 11 years 9 months 18 days | |||||||
Landmark Acquisition | Trade name | ||||||||
Asset Acquisition [Line Items] | ||||||||
Acquisition and merger-related expense | $ 86,200 | |||||||
Landmark Partners XVI - GP | ||||||||
Asset Acquisition [Line Items] | ||||||||
Business combination equity interest in acquiree, percentage | 60.00% | |||||||
Black Creek Acquisition | ||||||||
Asset Acquisition [Line Items] | ||||||||
Business combination equity interest in acquiree, percentage | 100.00% | |||||||
Bargain purchase gain | $ 42,300 | |||||||
Black Creek Acquisition | Management contracts | ||||||||
Asset Acquisition [Line Items] | ||||||||
Acquisition and merger-related expense | $ 576,200 | |||||||
Acquired finite lived intangible assets useful life | 6 years 1 month 6 days | |||||||
Black Creek Acquisition | Client relationships | ||||||||
Asset Acquisition [Line Items] | ||||||||
Acquisition and merger-related expense | $ 7,200 | |||||||
Acquired finite lived intangible assets useful life | 12 years |
BUSINESS COMBINATIONS - Acquisi
BUSINESS COMBINATIONS - Acquisition Date Fair Value (Details) - Landmark Acquisition $ in Thousands | Jun. 02, 2021USD ($)shares |
Asset Acquisition [Line Items] | |
Cash | $ 803,829 |
Equity | 299,640 |
Total | $ 1,103,469 |
Ares Operating Group | |
Asset Acquisition [Line Items] | |
Equity interest issued or issuable (in shares) | shares | 5,419,413 |
BUSINESS COMBINATIONS - Fair Va
BUSINESS COMBINATIONS - Fair Value of Assets Acquired and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 02, 2021 | Dec. 31, 2020 |
Intangible assets: | |||
Goodwill | $ 787,750 | $ 417,700 | $ 371,047 |
Landmark Acquisition | |||
Asset Acquisition [Line Items] | |||
Cash | 25,685 | ||
Other tangible assets | 23,411 | ||
Intangible assets: | |||
Total intangible assets | 709,240 | ||
Total identifiable assets acquired | 758,336 | ||
Accounts payable, accrued expenses and other liabilities | 72,532 | ||
Net identifiable assets acquired | 685,804 | ||
Goodwill | 417,665 | ||
Net assets acquired | 1,103,469 | ||
Landmark Acquisition | Management contracts | |||
Intangible assets: | |||
Total intangible assets | 425,880 | ||
Landmark Acquisition | Client relationships | |||
Intangible assets: | |||
Total intangible assets | 197,160 | ||
Landmark Acquisition | Trade name | |||
Intangible assets: | |||
Total intangible assets | $ 86,200 |
BUSINESS COMBINATIONS - Supplem
BUSINESS COMBINATIONS - Supplemental Information on Unaudited Pro Forma (Details) - USD ($) $ in Thousands | 3 Months Ended | 4 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | |||||
Total revenues | $ 54,000 | ||||
Net income attributable to Ares Management Corporation Class A and non-voting common stockholders | $ 26,800 | ||||
Landmark Acquisition | |||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | |||||
Total revenues | $ 948,719 | $ 527,105 | $ 2,966,540 | $ 1,214,989 | |
Net income attributable to Ares Management Corporation Class A and non-voting common stockholders | $ 87,542 | $ 37,570 | $ 257,361 | $ 41,263 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Carrying Value of Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Finite-lived intangible assets, net | ||
Finite-lived intangible assets | $ 882,317 | $ 247,077 |
Foreign currency translation | 1,530 | 3,093 |
Total finite-lived intangible assets | 883,847 | 250,170 |
Less: accumulated amortization | (85,157) | (28,082) |
Finite-lived intangible assets, net | 798,690 | 222,088 |
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 654,000 | 0 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Intangible assets, net | 1,452,690 | 222,088 |
Management contracts | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 567,800 | 0 |
Trade name | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | $ 86,200 | 0 |
Management contracts | ||
Finite-lived intangible assets, net | ||
Weighted average amortization period | 6 years 6 months | |
Finite-lived intangible assets | $ 641,737 | 210,857 |
Client relationships | ||
Finite-lived intangible assets, net | ||
Weighted average amortization period | 11 years 2 months 12 days | |
Finite-lived intangible assets | $ 229,501 | 25,141 |
Trade name | ||
Finite-lived intangible assets, net | ||
Weighted average amortization period | 8 years 8 months 12 days | |
Finite-lived intangible assets | $ 11,079 | $ 11,079 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) - USD ($) | Jul. 01, 2021 | Jun. 02, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Acquisition and merger-related expense | $ 4,900,000 | |||||
Goodwill impairment | $ 0 | $ 0 | ||||
Management contracts | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Fully-amortized intangibles, amount removed during the period | $ 3,400,000 | |||||
General, administrative and other expense | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Amortization expense | $ 32,800,000 | $ 11,100,000 | $ 60,700,000 | $ 13,700,000 | ||
Black Creek Acquisition | Management contracts | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Acquisition and merger-related expense | $ 576,200,000 | |||||
Acquired finite lived intangible assets useful life | 6 years 1 month 6 days | |||||
Black Creek Acquisition | Client relationships | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Acquisition and merger-related expense | $ 7,200,000 | |||||
Acquired finite lived intangible assets useful life | 12 years |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | $ 371,047 |
Acquisitions | 417,665 |
Foreign currency translation | (962) |
Goodwill, ending balance | 787,750 |
Credit Group | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 32,196 |
Acquisitions | 0 |
Foreign currency translation | 0 |
Goodwill, ending balance | 32,196 |
Private Equity Group | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 58,600 |
Acquisitions | 0 |
Foreign currency translation | 0 |
Goodwill, ending balance | 58,600 |
Real Estate Group | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 53,120 |
Acquisitions | 0 |
Foreign currency translation | 219 |
Goodwill, ending balance | 53,339 |
Secondary Solutions Group | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 0 |
Acquisitions | 417,665 |
Foreign currency translation | (16) |
Goodwill, ending balance | 417,649 |
Strategic Initiatives | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 227,131 |
Acquisitions | 0 |
Foreign currency translation | (1,165) |
Goodwill, ending balance | $ 225,966 |
INVESTMENTS - Fair Value Invest
INVESTMENTS - Fair Value Investments, excluding Equity Method Investments Held at Fair Value (Details) - Ares Management L.P - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Investments | ||
Partnership interests | $ 8,618 | $ 3,784 |
Collateralized loan obligations | 32,724 | 31,766 |
Other fixed income | 172,732 | 146,552 |
Common stock, at fair value | 109,807 | 89,419 |
Total investments | $ 3,322,665 | $ 1,682,759 |
Percentage of total investments | 1.00% | 1.90% |
Crestline Denali Class B Interests | ||
Investments | ||
Collateralized loan obligations | $ 3,200 | $ 3,400 |
Partnership Interests | ||
Investments | ||
Equity method investments: | $ 3,266,948 | $ 1,628,403 |
Percentage of total investments | 98.30% | 96.80% |
Other fixed income | ||
Investments | ||
Other fixed income | $ 21,583 | $ 21,583 |
Percentage of total investments | 0.60% | 1.30% |
Collateralized loan obligations and other fixed income, at fair value | ||
Investments | ||
Collateralized loan obligations | $ 54,307 | $ 53,349 |
Percentage of total investments | 1.60% | 3.20% |
Common stock, at fair value | ||
Investments | ||
Common stock, at fair value | $ 1,410 | $ 1,007 |
Percentage of total investments | 0.10% | 0.10% |
Partnership Interests | ||
Investments | ||
Equity method investments: | $ 492,482 | $ 366,471 |
Percentage of total investments | 14.80% | 21.80% |
Equity method - carried interest | ||
Investments | ||
Equity method investments: | $ 2,625,319 | $ 1,145,853 |
Percentage of total investments | 79.00% | 68.10% |
Equity method private investment partnership interests and other (held at fair value) | ||
Investments | ||
Equity method investments: | $ 117,015 | $ 92,196 |
Percentage of total investments | 3.50% | 5.50% |
Equity method private investment partnership interests and other | ||
Investments | ||
Partnership interests | $ 32,132 | $ 23,883 |
Percentage of total investments | 1.00% | 1.40% |
INVESTMENTS - Narrative (Detail
INVESTMENTS - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Investments in and Advances to Affiliates [Abstract] | ||||
Equity method investments gains | $ 18.9 | $ 8.9 | $ 99.3 | $ 1.8 |
INVESTMENTS - Investments of th
INVESTMENTS - Investments of the Consolidated Funds (Details) - Consolidated Funds - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Investments | ||
Total investments, at fair value | $ 11,361,019 | $ 10,877,097 |
Percent of total assets | 5.00% | 5.00% |
Percentage of interest yield | 0.06% | |
Fixed income investments: | ||
Investments | ||
Total investments, at fair value | $ 10,852,660 | $ 10,410,442 |
Percentage of total investments | 95.60% | 95.70% |
Fixed income investments: | Bonds | ||
Investments | ||
Total investments, at fair value | $ 434,226 | $ 397,494 |
Percentage of total investments | 3.90% | 3.60% |
Fixed income investments: | Loans | ||
Investments | ||
Total investments, at fair value | $ 9,389,769 | $ 10,012,948 |
Percentage of total investments | 82.60% | 92.10% |
Fixed income investments: | U.S. Treasury securities | ||
Investments | ||
Total investments, at fair value | $ 1,000,165 | $ 0 |
Percentage of total investments | 8.80% | 0.00% |
Fixed income investments: | Investments in CLO warehouse | ||
Investments | ||
Total investments, at fair value | $ 28,500 | $ 0 |
Percentage of total investments | 0.30% | 0.00% |
Equity securities | ||
Investments | ||
Total investments, at fair value | $ 264,202 | $ 227,031 |
Percentage of total investments | 2.30% | 2.10% |
Partnership interests | ||
Investments | ||
Total investments, at fair value | $ 244,157 | $ 239,624 |
Percentage of total investments | 2.10% | 2.20% |
FAIR VALUE - Assets and Liabili
FAIR VALUE - Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Consolidated Funds | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | $ 10,852,660 | $ 10,410,442 |
Common stock and other equity securities | 264,202 | 227,031 |
Partnership interests | 244,157 | 239,624 |
Total investments, at fair value | 11,361,019 | 10,877,097 |
Total derivative assets, at fair value | 325 | |
Total assets, at fair value | 11,361,344 | 10,878,201 |
Liabilities, at fair value | ||
Derivative liabilities | (18,513) | |
Loan obligations of CLOs | (10,174,794) | (9,958,076) |
Total liabilities, at fair value | (10,193,307) | (9,958,120) |
Consolidated Funds | Asset swaps-other | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 325 | 1,104 |
Liabilities, at fair value | ||
Derivative liabilities | (1,513) | (44) |
Consolidated Funds | Warrants | ||
Liabilities, at fair value | ||
Derivative liabilities | (17,000) | |
Consolidated Funds | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 28,500 | |
Consolidated Funds | Bonds | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 434,226 | 397,494 |
Consolidated Funds | Loans | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 9,389,769 | 10,012,948 |
Consolidated Funds | U.S. Treasury securities | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 1,000,165 | |
Consolidated Funds | Level I | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 1,000,165 | 0 |
Common stock and other equity securities | 3,366 | 5,749 |
Partnership interests | 0 | 0 |
Total investments, at fair value | 1,003,531 | 5,749 |
Total derivative assets, at fair value | 0 | |
Total assets, at fair value | 1,003,531 | 5,749 |
Liabilities, at fair value | ||
Derivative liabilities | (17,000) | |
Loan obligations of CLOs | 0 | 0 |
Total liabilities, at fair value | (17,000) | 0 |
Consolidated Funds | Level I | Asset swaps-other | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | 0 |
Liabilities, at fair value | ||
Derivative liabilities | 0 | 0 |
Consolidated Funds | Level I | Warrants | ||
Liabilities, at fair value | ||
Derivative liabilities | (17,000) | |
Consolidated Funds | Level I | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | |
Consolidated Funds | Level I | Bonds | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | 0 |
Consolidated Funds | Level I | Loans | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | 0 |
Consolidated Funds | Level I | U.S. Treasury securities | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 1,000,165 | |
Consolidated Funds | Level II | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 9,449,819 | 9,868,136 |
Common stock and other equity securities | 1,590 | 239 |
Partnership interests | 0 | 0 |
Total investments, at fair value | 9,451,409 | 9,868,375 |
Total derivative assets, at fair value | 0 | |
Total assets, at fair value | 9,451,409 | 9,868,375 |
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Loan obligations of CLOs | (10,174,794) | (9,958,076) |
Total liabilities, at fair value | (10,174,794) | (9,958,076) |
Consolidated Funds | Level II | Asset swaps-other | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | 0 |
Liabilities, at fair value | ||
Derivative liabilities | 0 | 0 |
Consolidated Funds | Level II | Warrants | ||
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Consolidated Funds | Level II | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 28,500 | |
Consolidated Funds | Level II | Bonds | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 406,253 | 397,485 |
Consolidated Funds | Level II | Loans | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 9,015,066 | 9,470,651 |
Consolidated Funds | Level II | U.S. Treasury securities | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | |
Consolidated Funds | Level III | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 402,676 | 542,306 |
Common stock and other equity securities | 259,246 | 221,043 |
Partnership interests | 237,558 | 231,857 |
Total investments, at fair value | 899,480 | 995,206 |
Total derivative assets, at fair value | 325 | |
Total assets, at fair value | 899,805 | 996,310 |
Liabilities, at fair value | ||
Derivative liabilities | (1,513) | (44) |
Loan obligations of CLOs | 0 | 0 |
Total liabilities, at fair value | (1,513) | (44) |
Consolidated Funds | Level III | Asset swaps-other | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 325 | 1,104 |
Liabilities, at fair value | ||
Derivative liabilities | (1,513) | (44) |
Consolidated Funds | Level III | Warrants | ||
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Consolidated Funds | Level III | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | |
Consolidated Funds | Level III | Bonds | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 27,973 | 9 |
Consolidated Funds | Level III | Loans | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 374,703 | 542,297 |
Consolidated Funds | Level III | U.S. Treasury securities | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | |
Consolidated Funds | Investments Measured at NAV | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | 0 |
Common stock and other equity securities | 0 | 0 |
Partnership interests | 6,599 | 7,767 |
Total investments, at fair value | 6,599 | 7,767 |
Total derivative assets, at fair value | 0 | |
Total assets, at fair value | 6,599 | 7,767 |
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Loan obligations of CLOs | 0 | 0 |
Total liabilities, at fair value | 0 | 0 |
Consolidated Funds | Investments Measured at NAV | Asset swaps-other | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | 0 |
Liabilities, at fair value | ||
Derivative liabilities | 0 | 0 |
Consolidated Funds | Investments Measured at NAV | Warrants | ||
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Consolidated Funds | Investments Measured at NAV | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | |
Consolidated Funds | Investments Measured at NAV | Bonds | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | 0 |
Consolidated Funds | Investments Measured at NAV | Loans | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | 0 |
Consolidated Funds | Investments Measured at NAV | U.S. Treasury securities | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | |
Ares Management L.P | ||
Assets, at fair value | ||
Common stock and other equity securities | 109,807 | 89,419 |
Partnership interests | 8,618 | 3,784 |
Total investments, at fair value | 172,732 | 146,552 |
Total assets, at fair value | 177,093 | 147,992 |
Liabilities, at fair value | ||
Derivative liabilities | (1,565) | |
Contingent consideration | (41,413) | |
Total liabilities, at fair value | (41,678) | (1,565) |
Ares Management L.P | Derivatives-foreign exchange contracts and interest rate contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 4,361 | |
Ares Management L.P | Derivatives-foreign exchange contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 1,440 | |
Liabilities, at fair value | ||
Derivative liabilities | (265) | |
Ares Management L.P | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 54,307 | 53,349 |
Ares Management L.P | Level I | ||
Assets, at fair value | ||
Common stock and other equity securities | 0 | 0 |
Partnership interests | 0 | 0 |
Total investments, at fair value | 0 | 0 |
Total assets, at fair value | 0 | 0 |
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Contingent consideration | 0 | |
Total liabilities, at fair value | 0 | 0 |
Ares Management L.P | Level I | Derivatives-foreign exchange contracts and interest rate contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | |
Ares Management L.P | Level I | Derivatives-foreign exchange contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | |
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Ares Management L.P | Level I | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | 0 |
Ares Management L.P | Level II | ||
Assets, at fair value | ||
Common stock and other equity securities | 1,410 | 1,007 |
Partnership interests | 0 | 0 |
Total investments, at fair value | 1,410 | 1,007 |
Total assets, at fair value | 5,771 | 2,447 |
Liabilities, at fair value | ||
Derivative liabilities | (1,565) | |
Contingent consideration | 0 | |
Total liabilities, at fair value | (265) | (1,565) |
Ares Management L.P | Level II | Derivatives-foreign exchange contracts and interest rate contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 4,361 | |
Ares Management L.P | Level II | Derivatives-foreign exchange contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 1,440 | |
Liabilities, at fair value | ||
Derivative liabilities | (265) | |
Ares Management L.P | Level II | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 0 | 0 |
Ares Management L.P | Level III | ||
Assets, at fair value | ||
Common stock and other equity securities | 108,397 | 88,412 |
Partnership interests | 2,575 | 2,575 |
Total investments, at fair value | 165,279 | 144,336 |
Total assets, at fair value | 165,279 | 144,336 |
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Contingent consideration | (41,413) | |
Total liabilities, at fair value | (41,413) | 0 |
Ares Management L.P | Level III | Derivatives-foreign exchange contracts and interest rate contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | |
Ares Management L.P | Level III | Derivatives-foreign exchange contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | |
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Ares Management L.P | Level III | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | 54,307 | 53,349 |
Ares Management L.P | Investments Measured at NAV | ||
Assets, at fair value | ||
Common stock and other equity securities | 0 | 0 |
Partnership interests | 6,043 | 1,209 |
Total investments, at fair value | 6,043 | 1,209 |
Total assets, at fair value | 6,043 | 1,209 |
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Contingent consideration | 0 | |
Total liabilities, at fair value | 0 | 0 |
Ares Management L.P | Investments Measured at NAV | Derivatives-foreign exchange contracts and interest rate contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | |
Ares Management L.P | Investments Measured at NAV | Derivatives-foreign exchange contracts | ||
Assets, at fair value | ||
Total derivative assets, at fair value | 0 | |
Liabilities, at fair value | ||
Derivative liabilities | 0 | |
Ares Management L.P | Investments Measured at NAV | Collateralized loan obligations and other fixed income, at fair value | ||
Assets, at fair value | ||
Collateralized loan obligations and other fixed income | $ 0 | $ 0 |
FAIR VALUE - Changes in Fair Va
FAIR VALUE - Changes in Fair Value of Level III Measurements (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Consolidated Funds | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | $ 938,346 | $ 942,584 | $ 996,265 | $ 717,030 |
Transfer in (out) due to changes in consolidation | (49,483) | 392,037 | ||
Transfer in | 18,792 | 96,671 | 50,013 | 146,839 |
Transfer out | (209,282) | (230,326) | (216,210) | (350,078) |
Purchases | 246,526 | 118,708 | 486,627 | 321,065 |
Sales/settlements | (118,272) | (74,330) | (403,581) | (306,928) |
Amortized discounts/premiums | 394 | 5 | 1,465 | 1,068 |
Realized and unrealized appreciation (depreciation), net | 21,788 | 14,869 | 33,196 | (52,852) |
Balance, end of period | 898,292 | 868,181 | 898,292 | 868,181 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | 16,736 | 12,562 | 26,521 | (55,970) |
Consolidated Funds | Equity securities | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | 229,300 | 42,259 | 221,043 | 85,988 |
Transfer in (out) due to changes in consolidation | (157) | (635) | ||
Transfer in | 0 | 0 | 2,195 | 0 |
Transfer out | 0 | 0 | (33) | 0 |
Purchases | 27,346 | 150 | 36,201 | 551 |
Sales/settlements | (313) | (25) | (876) | (714) |
Amortized discounts/premiums | 0 | 0 | 1 | 0 |
Realized and unrealized appreciation (depreciation), net | 2,913 | 828 | 872 | (41,978) |
Balance, end of period | 259,246 | 43,212 | 259,246 | 43,212 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | 2,912 | 878 | 790 | (41,930) |
Consolidated Funds | Fixed Income | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | 455,426 | 586,287 | 542,305 | 339,136 |
Transfer in (out) due to changes in consolidation | (49,326) | 392,672 | ||
Transfer in | 18,792 | 96,671 | 47,818 | 146,839 |
Transfer out | (209,282) | (230,326) | (216,177) | (350,078) |
Purchases | 219,180 | 118,558 | 437,426 | 256,514 |
Sales/settlements | (88,584) | (73,010) | (371,006) | (249,027) |
Amortized discounts/premiums | 394 | (135) | 1,464 | 777 |
Realized and unrealized appreciation (depreciation), net | 6,750 | 15,836 | 10,172 | (22,952) |
Balance, end of period | 402,676 | 513,881 | 402,676 | 513,881 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | 1,607 | 13,690 | 2,700 | (25,701) |
Consolidated Funds | Partnership Interests | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | 255,278 | 312,636 | 231,857 | 296,012 |
Transfer in (out) due to changes in consolidation | 0 | 0 | ||
Transfer in | 0 | 0 | 0 | 0 |
Transfer out | 0 | 0 | 0 | 0 |
Purchases | 0 | 0 | 13,000 | 64,000 |
Sales/settlements | (30,000) | (2,000) | (32,000) | (58,000) |
Amortized discounts/premiums | 0 | 0 | 0 | 0 |
Realized and unrealized appreciation (depreciation), net | 12,280 | (1,402) | 24,701 | 7,222 |
Balance, end of period | 237,558 | 309,234 | 237,558 | 309,234 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | 12,280 | (1,402) | 24,701 | 7,222 |
Consolidated Funds | Derivatives, Net | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | (1,658) | 1,402 | 1,060 | (4,106) |
Transfer in (out) due to changes in consolidation | 0 | 0 | ||
Transfer in | 0 | 0 | 0 | 0 |
Transfer out | 0 | 0 | 0 | 0 |
Purchases | 0 | 0 | 0 | 0 |
Sales/settlements | 625 | 705 | 301 | 813 |
Amortized discounts/premiums | 0 | 140 | 0 | 291 |
Realized and unrealized appreciation (depreciation), net | (155) | (393) | (2,549) | 4,856 |
Balance, end of period | (1,188) | 1,854 | (1,188) | 1,854 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | (63) | (604) | (1,670) | 4,439 |
Ares Management L.P | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | 165,655 | 84,634 | 144,336 | 119,079 |
Transfer in (out) due to changes in consolidation | 72,967 | 7,623 | 76,653 | |
Established in connection with acquisition | (34,200) | (34,200) | ||
Purchases | 708 | 5,983 | 20,967 | 7,285 |
Sales/settlements | (2,904) | (899) | (12,120) | (34,017) |
Realized and unrealized appreciation (depreciation), net | (5,393) | 1,429 | (2,740) | (4,886) |
Balance, end of period | 123,866 | 164,114 | 123,866 | 164,114 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | (5,381) | (1,429) | (4,191) | 1,848 |
Ares Management L.P | Contingent Consideration | ||||
Level III Liabilities of the Company | ||||
Balance, beginning of period | 0 | 0 | ||
Transfer in due to changes in consolidation | 0 | |||
Established in connection with acquisition | (34,200) | (34,200) | ||
Purchases | 0 | 0 | ||
Sales/settlements | 0 | 0 | ||
Realized and unrealized appreciation (depreciation), net | (7,213) | (7,213) | ||
Balance, end of period | (41,413) | (41,413) | ||
Change in net unrealized appreciation/depreciation included in earnings related to financial assets and liabilities still held at the reporting date | (7,213) | (7,213) | ||
Ares Management L.P | Equity securities | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | 107,240 | 14,704 | 88,412 | 14,704 |
Transfer in (out) due to changes in consolidation | 72,967 | 0 | 72,967 | |
Established in connection with acquisition | 0 | 0 | ||
Purchases | 0 | 0 | 19,278 | 0 |
Sales/settlements | 0 | 0 | 0 | 0 |
Realized and unrealized appreciation (depreciation), net | 1,157 | (1,746) | 707 | (1,746) |
Balance, end of period | 108,397 | 85,925 | 108,397 | 85,925 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | 1,157 | 1,746 | 707 | (1,746) |
Ares Management L.P | Fixed Income | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | 55,840 | 67,355 | 53,349 | 69,183 |
Transfer in (out) due to changes in consolidation | 0 | 7,623 | 3,686 | |
Established in connection with acquisition | 0 | 0 | ||
Purchases | 708 | 5,983 | 1,689 | 7,285 |
Sales/settlements | (2,904) | (899) | (12,120) | (1,587) |
Realized and unrealized appreciation (depreciation), net | 663 | 3,175 | 3,766 | (2,953) |
Balance, end of period | 54,307 | 75,614 | 54,307 | 75,614 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | 675 | (3,175) | 2,315 | (1,917) |
Ares Management L.P | Partnership Interests | ||||
Level III Net Assets of Consolidated Funds | ||||
Balance, beginning of period | 2,575 | 2,575 | 2,575 | 35,192 |
Transfer in (out) due to changes in consolidation | 0 | 0 | 0 | |
Established in connection with acquisition | 0 | 0 | ||
Purchases | 0 | 0 | 0 | 0 |
Sales/settlements | 0 | 0 | 0 | (32,430) |
Realized and unrealized appreciation (depreciation), net | 0 | 0 | 0 | (187) |
Balance, end of period | 2,575 | 2,575 | 2,575 | 2,575 |
Change in net unrealized appreciation/depreciation included in earnings related to financial assets still held at the reporting date | $ 0 | $ 0 | $ 0 | $ 5,511 |
FAIR VALUE - Valuation Techniqu
FAIR VALUE - Valuation Techniques (Details) $ in Thousands | Sep. 30, 2021USD ($) | Dec. 31, 2020USD ($) |
Consolidated Funds | ||
Assets | ||
Equity securities | $ 264,202 | $ 227,031 |
Partnership interests | 244,157 | 239,624 |
Collateralized loan obligations | 10,174,794 | 9,958,076 |
Other fixed income | 10,852,660 | 10,410,442 |
Derivative instruments | 325 | |
Total derivative assets, at fair value | 11,361,344 | 10,878,201 |
Liabilities | ||
Derivative instruments | (18,513) | |
Total liabilities, at fair value | (10,193,307) | (9,958,120) |
Consolidated Funds | Level III | ||
Assets | ||
Equity securities | 259,246 | 221,043 |
Partnership interests | 237,558 | 231,857 |
Collateralized loan obligations | 0 | 0 |
Other fixed income | 402,676 | 542,306 |
Derivative instruments | 325 | |
Total derivative assets, at fair value | 899,805 | 996,310 |
Liabilities | ||
Derivative instruments | (1,513) | (44) |
Total liabilities, at fair value | (1,513) | $ (44) |
Consolidated Funds | Level III | Discount Rates | ||
Significant Unobservable Input(s) | ||
Partnership interest | 0.238 | |
Consolidated Funds | Level III | Discount Rates | Weighted Average | ||
Significant Unobservable Input(s) | ||
Partnership interest | 0.238 | |
Consolidated Funds | Level III | Illiquidity discount | ||
Significant Unobservable Input(s) | ||
Equity securities | 0.250 | |
Consolidated Funds | Level III | Illiquidity discount | Weighted Average | ||
Significant Unobservable Input(s) | ||
Equity securities | 0.250 | |
Consolidated Funds | Level III | Transaction price | ||
Assets | ||
Equity securities | 258,336 | $ 188,044 |
Other fixed income | 14,791 | |
Consolidated Funds | Level III | Discounted Cash Flow | ||
Assets | ||
Partnership interests | $ 237,558 | 231,857 |
Consolidated Funds | Level III | Discounted Cash Flow | Discount Rates | ||
Significant Unobservable Input(s) | ||
Partnership interest | 0.224 | |
Consolidated Funds | Level III | Discounted Cash Flow | Discount Rates | Weighted Average | ||
Significant Unobservable Input(s) | ||
Partnership interest | 0.224 | |
Consolidated Funds | Level III | Market Approach | ||
Assets | ||
Equity securities | $ 896 | 438 |
Other fixed income | $ 6,605 | |
Consolidated Funds | Level III | Market Approach | EBITDA multiple | Minimum | ||
Significant Unobservable Input(s) | ||
Equity securities | 1.8 | 2.9 |
Fixed income securities | 6.5 | |
Consolidated Funds | Level III | Market Approach | EBITDA multiple | Maximum | ||
Significant Unobservable Input(s) | ||
Equity securities | 83.3 | 19.5 |
Fixed income securities | 7.8 | |
Consolidated Funds | Level III | Market Approach | EBITDA multiple | Weighted Average | ||
Significant Unobservable Input(s) | ||
Equity securities | 15.3 | 13.4 |
Fixed income securities | 6.9 | |
Consolidated Funds | Level III | Other | ||
Assets | ||
Equity securities | $ 32,528 | |
Other fixed income | $ 28,766 | $ 28,320 |
Consolidated Funds | Level III | Other | Net income multiple | ||
Significant Unobservable Input(s) | ||
Equity securities | 30 | |
Consolidated Funds | Level III | Other | Net income multiple | Weighted Average | ||
Significant Unobservable Input(s) | ||
Equity securities | 30 | |
Consolidated Funds | Level III | Broker quotes and/or 3rd party pricing services | ||
Assets | ||
Equity securities | 14 | $ 33 |
Other fixed income | 261,064 | 384,419 |
Derivative instruments | 325 | 1,104 |
Liabilities | ||
Derivative instruments | (1,513) | |
Consolidated Funds | Level III | Income approach | ||
Assets | ||
Other fixed income | $ 98,055 | $ 122,962 |
Consolidated Funds | Level III | Income approach | Yield | Minimum | ||
Significant Unobservable Input(s) | ||
Fixed income securities | 1.8 | 0.027 |
Consolidated Funds | Level III | Income approach | Yield | Maximum | ||
Significant Unobservable Input(s) | ||
Fixed income securities | 54.7 | 0.481 |
Consolidated Funds | Level III | Income approach | Yield | Weighted Average | ||
Significant Unobservable Input(s) | ||
Fixed income securities | 6.5 | 0.079 |
Ares Management L.P | ||
Assets | ||
Equity securities | $ 109,807 | $ 89,419 |
Partnership interests | 8,618 | 3,784 |
Total derivative assets, at fair value | 177,093 | 147,992 |
Liabilities | ||
Contingent consideration | (41,413) | |
Derivative instruments | (1,565) | |
Total liabilities, at fair value | (41,678) | (1,565) |
Ares Management L.P | Level III | ||
Assets | ||
Equity securities | 108,397 | 88,412 |
Partnership interests | 2,575 | 2,575 |
Total derivative assets, at fair value | 165,279 | 144,336 |
Liabilities | ||
Contingent consideration | (41,413) | |
Derivative instruments | 0 | |
Total liabilities, at fair value | (41,413) | 0 |
Ares Management L.P | Level III | Transaction price | ||
Assets | ||
Equity securities | 14,704 | 14,704 |
Ares Management L.P | Level III | Discounted Cash Flow | ||
Assets | ||
Equity securities | $ 46,765 | $ 32,905 |
Ares Management L.P | Level III | Discounted Cash Flow | Discount Rates | Minimum | ||
Significant Unobservable Input(s) | ||
Equity securities | 0.140 | 0.140 |
Ares Management L.P | Level III | Discounted Cash Flow | Discount Rates | Maximum | ||
Significant Unobservable Input(s) | ||
Equity securities | 0.200 | 0.200 |
Ares Management L.P | Level III | Discounted Cash Flow | Discount Rates | Weighted Average | ||
Significant Unobservable Input(s) | ||
Equity securities | 0.153 | |
Ares Management L.P | Level III | Market Approach | ||
Assets | ||
Equity securities | $ 46,928 | $ 40,803 |
Ares Management L.P | Level III | Market Approach | Multiple of Book Value | ||
Significant Unobservable Input(s) | ||
Equity securities | 1.5 | 1.6 |
Ares Management L.P | Level III | Other | ||
Assets | ||
Partnership interests | $ 2,575 | $ 2,575 |
Other fixed income | 21,583 | 21,583 |
Liabilities | ||
Contingent consideration | (32,813) | |
Ares Management L.P | Level III | Broker quotes and/or 3rd party pricing services | ||
Assets | ||
Collateralized loan obligations | 32,724 | $ 31,766 |
Ares Management L.P | Level III | Monte Carlo simulation | ||
Liabilities | ||
Contingent consideration | $ (8,600) | |
Ares Management L.P | Level III | Monte Carlo simulation | Discount Rates | ||
Significant Unobservable Input(s) | ||
Contingent consideration | 8 | |
Ares Management L.P | Level III | Monte Carlo simulation | Volatility | ||
Significant Unobservable Input(s) | ||
Contingent consideration | 0.17 |
FAIR VALUE - Investments Using
FAIR VALUE - Investments Using NAV per Share (Details) - Investments Measured at NAV - Non-core investments - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
FAIR VALUE | ||
Fair value | $ 6,000,000 | $ 1,200,000 |
Unfunded commitments | $ 0 | $ 0 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Consolidated Funds | ||
Assets | ||
Notional amount, assets | $ 44,521 | $ 7,600 |
Fair Value | 325 | 1,104 |
Liabilities | ||
Notional amount, liabilities | 269,701 | 540 |
Fair Value | 18,513 | 44 |
Derivative liability, amount offset | (300) | (400) |
Derivative asset, amount offset | 300 | 400 |
Consolidated Funds | Warrants | ||
Assets | ||
Notional amount, assets | 0 | 0 |
Fair Value | 0 | 0 |
Liabilities | ||
Notional amount, liabilities | 230,000 | 0 |
Fair Value | 17,000 | 0 |
Consolidated Funds | Asset swap - other | ||
Assets | ||
Notional amount, assets | 44,521 | 7,600 |
Fair Value | 325 | 1,104 |
Liabilities | ||
Notional amount, liabilities | 39,701 | 540 |
Fair Value | 1,513 | 44 |
Ares Management L.P | ||
Assets | ||
Notional amount, assets | 99,463 | 30,040 |
Fair Value | 4,361 | 1,440 |
Liabilities | ||
Notional amount, liabilities | 9,868 | 39,362 |
Fair Value | 265 | 1,565 |
Derivative liability, amount offset | (300) | (1,600) |
Ares Management L.P | Foreign exchange contracts | ||
Assets | ||
Notional amount, assets | 81,008 | 30,040 |
Fair Value | 4,352 | 1,440 |
Liabilities | ||
Notional amount, liabilities | 9,868 | 39,362 |
Fair Value | 265 | 1,565 |
Ares Management L.P | Interest rate contracts | ||
Assets | ||
Notional amount, assets | 18,455 | 0 |
Fair Value | 9 | 0 |
Liabilities | ||
Notional amount, liabilities | 0 | 0 |
Fair Value | $ 0 | $ 0 |
DEBT - Debt Obligations (Detail
DEBT - Debt Obligations (Details) - Ares Management L.P - USD ($) | 1 Months Ended | 9 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Oct. 31, 2014 | Sep. 30, 2021 | Dec. 31, 2020 | |
DEBT | |||||
Carrying Value | $ 1,238,325,000 | $ 642,998,000 | |||
US Treasury | |||||
DEBT | |||||
Interest rate | 3.237% | ||||
Debt term | 5 years | ||||
Credit Facility | |||||
DEBT | |||||
Carrying Value | $ 150,000,000 | $ 0 | |||
Interest Rate | 1.13% | 0.00% | |||
Maximum borrowing capacity | $ 1,090,000,000 | ||||
Unused commitment fees | 0.10% | ||||
Interest rate | 0.00% | ||||
Credit Facility | Base rate | |||||
DEBT | |||||
Interest rate spread | 0.125% | ||||
Credit Facility | LIBOR | |||||
DEBT | |||||
Interest rate spread | 1.125% | ||||
Senior Notes 2024 | |||||
DEBT | |||||
Original Borrowing Amount | $ 250,000,000 | ||||
Carrying Value | $ 247,802,000 | $ 247,285,000 | |||
Interest Rate | 4.21% | 4.21% | |||
Debt issuance rate | 98.27% | ||||
Senior Notes 2030 | |||||
DEBT | |||||
Original Borrowing Amount | $ 400,000,000 | ||||
Carrying Value | $ 396,045,000 | $ 395,713,000 | |||
Interest Rate | 3.28% | 3.28% | |||
Debt issuance rate | 99.77% | ||||
Subordinated Notes 2051 | |||||
DEBT | |||||
Original Borrowing Amount | $ 450,000,000 | ||||
Carrying Value | $ 444,478,000 | $ 0 | |||
Interest Rate | 4.13% | 0.00% | |||
Interest rate | 4.125% | ||||
Debt issuance rate | 100.00% |
DEBT - Debt Issuance Costs (Det
DEBT - Debt Issuance Costs (Details) - Ares Management L.P $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Credit Facility | |
Debt Issuance Costs | |
Unamortized debt issuance costs, beginning balance | $ 5,232 |
Debt issuance costs incurred | 1,282 |
Amortization of debt issuance costs | (929) |
Unamortized debt issuance costs, ending balance | 5,585 |
Senior Notes | |
Debt Issuance Costs | |
Unamortized debt issuance costs, beginning balance | 4,283 |
Debt issuance costs incurred | 0 |
Amortization of debt issuance costs | (446) |
Unamortized debt issuance costs, ending balance | 3,837 |
Subordinated Notes | |
Debt Issuance Costs | |
Unamortized debt issuance costs, beginning balance | 0 |
Debt issuance costs incurred | 5,568 |
Amortization of debt issuance costs | (46) |
Unamortized debt issuance costs, ending balance | $ 5,522 |
DEBT - Loan Obligations of the
DEBT - Loan Obligations of the Consolidated CLOs (Details) - Consolidated Funds - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
DEBT | ||
Fair Value of Loan Obligations | $ 10,174,794 | $ 9,958,076 |
Loan obligations of Consolidated CLOs | ||
DEBT | ||
Loan Obligations | 10,301,292 | 10,278,833 |
Fair Value of Loan Obligations | 10,174,794 | 9,958,076 |
Senior secured notes | Loan obligations of Consolidated CLOs | ||
DEBT | ||
Loan Obligations | 9,577,725 | 9,796,442 |
Fair Value of Loan Obligations | $ 9,561,079 | $ 9,665,804 |
Weighted Average Remaining Maturity In Years | 9 years 6 months | 10 years 1 month 6 days |
Debt instrument face amount | $ 9,600,000 | |
Weighted average interest rate | 1.96% | |
Subordinated notes | Loan obligations of Consolidated CLOs | ||
DEBT | ||
Loan Obligations | $ 723,567 | $ 482,391 |
Fair Value of Loan Obligations | $ 613,715 | $ 292,272 |
Weighted Average Remaining Maturity In Years | 8 years 3 months 18 days | 10 years 2 months 12 days |
Debt instrument face amount | $ 723,600 |
DEBT - Credit Facilities of the
DEBT - Credit Facilities of the Consolidated Funds (Details) - Consolidated Funds - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
DEBT | ||
Total borrowings of Consolidated Funds | $ 99,240,000 | $ 121,909,000 |
Credit Facility Maturing 3/4/2022 | ||
DEBT | ||
Maximum borrowing capacity | 71,500,000 | |
Outstanding loan | $ 71,500,000 | $ 71,500,000 |
Effective Rate | 1.59% | 1.59% |
Credit Facility Maturing 7/1/2023 | ||
DEBT | ||
Maximum borrowing capacity | $ 18,000,000 | |
Outstanding loan | $ 17,740,000 | $ 17,909,000 |
Effective Rate | 1.63% | 1.75% |
Credit Facility Maturing 1/15/2022 | ||
DEBT | ||
Maximum borrowing capacity | $ 0 | |
Outstanding loan | $ 0 | $ 32,500,000 |
Effective Rate | 0.00% | 2.75% |
Credit Facility Maturing 7/23/2024 | ||
DEBT | ||
Maximum borrowing capacity | $ 75,000,000 | |
Outstanding loan | $ 10,000,000 | |
Effective Rate | 2.65% | |
Credit Facility Maturing 9/24/2026 | ||
DEBT | ||
Maximum borrowing capacity | $ 150,000,000 | |
Outstanding loan | $ 0 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) - USD ($) | 3 Months Ended | 4 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2021 | Jul. 01, 2021 | Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |||||
Unfunded capital commitments | $ 732,800,000 | $ 732,800,000 | $ 732,800,000 | $ 784,200,000 | |
Performance Income | |||||
Carried interest, contingent repayment obligations | 0 | 0 | 0 | 0 | |
Performance income | |||||
Performance Income | |||||
Performance income subject to potential clawback provision | 202,300,000 | 202,300,000 | 202,300,000 | 326,400,000 | |
Performance income subject to potential claw back provision that are reimbursable by professionals | 158,000,000 | 158,000,000 | 158,000,000 | $ 252,400,000 | |
Landmark Acquisition | |||||
COMMITMENTS AND CONTINGENCIES | |||||
Commitment, maximum amount | 300,000,000 | 300,000,000 | $ 300,000,000 | ||
Business combination, percentage | 15.00% | ||||
Business combination equity awards percentage | 85.00% | ||||
Vesting period | 4 years | ||||
Estimated fair value of the contingent consideration liability | 236,000,000 | 236,000,000 | $ 236,000,000 | ||
Compensation expense | 14,700,000 | 19,300,000 | |||
Black Creek Acquisition | |||||
COMMITMENTS AND CONTINGENCIES | |||||
Commitment, maximum amount | 275,000,000 | 275,000,000 | 275,000,000 | ||
Compensation expense | 13,500,000 | ||||
Fair value of contingent liability | 206,700,000 | 206,700,000 | 206,700,000 | ||
Contingent consideration | 32,800,000 | 32,800,000 | 32,800,000 | $ 28,600,000 | |
Payment percentage of performance income obligation | 50.00% | ||||
Black Creek Acquisition | Accrued Compensation | |||||
COMMITMENTS AND CONTINGENCIES | |||||
Contingent consideration | $ 13,500,000 | $ 13,500,000 | $ 13,500,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Leases: Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Lessee, Lease, Description [Line Items] | ||
Operating lease liabilities | $ 214,681 | |
Finance lease obligations | 977 | |
Accumulated amortization | $ 1,400 | $ 1,000 |
Finance lease assets [Extensible List] | Other assets | |
Finance lease, liability [Extensible List] | Accounts Payable and Accrued Liabilities | |
Ares Management L.P | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease assets | $ 176,511 | 154,742 |
Finance lease assets | 1,164 | 1,386 |
Total lease assets | 177,675 | 156,128 |
Operating lease liabilities | 214,681 | 180,236 |
Finance lease obligations | 977 | 1,273 |
Total lease liabilities | $ 215,658 | $ 181,509 |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Lease term | 1 year | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Lease term | 12 years |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Leases: Maturity of Lease Liabilities (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Operating Leases | |
2021 | $ 10,591 |
2022 | 41,989 |
2023 | 38,277 |
2024 | 36,579 |
2025 | 36,251 |
After 2025 | 66,683 |
Total future payments | 230,370 |
Less: interest | 15,689 |
Operating lease liabilities | 214,681 |
Finance Leases | |
2021 | 73 |
2022 | 598 |
2023 | 164 |
2024 | 162 |
2025 | 11 |
After 2025 | 0 |
Total future payments | 1,008 |
Less: interest | 31 |
Total lease liabilities | $ 977 |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES - Leases: Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Operating lease expense | $ 9,697 | $ 7,701 | $ 27,203 | $ 23,138 |
Amortization of finance lease assets | 154 | 127 | 408 | 346 |
Interest on finance lease liabilities | 7 | 11 | 24 | 33 |
Total lease expense | $ 9,858 | $ 7,839 | $ 27,635 | $ 23,517 |
COMMITMENTS AND CONTINGENCIES_5
COMMITMENTS AND CONTINGENCIES - Leases: Other Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows for operating leases | $ 26,704 | $ 23,098 |
Operating cash flows for finance leases | 34 | 48 |
Financing cash flows for finance leases | 463 | 412 |
Leased assets obtained in exchange for new finance lease liabilities | 189 | 0 |
Leased assets obtained in exchange for new operating lease liabilities | $ 55,461 | $ 12,477 |
COMMITMENTS AND CONTINGENCIES_6
COMMITMENTS AND CONTINGENCIES - Leases: Lease Term and Discount Rate (Details) | Sep. 30, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
Weighted-average remaining lease terms, operating lease | 6 years 1 month 6 days | 6 years |
Weighted-average remaining lease terms, finance lease | 2 years 1 month 6 days | 2 years 7 months 6 days |
Weighted-average discount rate, operating lease | 2.97% | 3.59% |
Weighted-average discount rate, finance lease | 2.91% | 3.26% |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Consolidated Funds | ||
Due from affiliates: | ||
Due from affiliates | $ 9,059 | $ 17,172 |
Due to affiliates: | ||
Due to affiliates—Company | 0 | 0 |
Consolidated Funds | Affiliated entity | ||
Due from affiliates: | ||
Due from affiliates | 9,059 | 17,172 |
Ares Management L.P | ||
Due from affiliates: | ||
Due from affiliates | 493,411 | 405,887 |
Due to affiliates: | ||
Due to affiliates—Company | 202,438 | 100,186 |
Ares Management L.P | Affiliated entity | ||
Due from affiliates: | ||
Management fees receivable from non-consolidated funds | 347,078 | 308,581 |
Incentive fee receivable from non-consolidated funds | 579 | 21,495 |
Payments made on behalf of and amounts due from non-consolidated funds and employees | 145,754 | 75,811 |
Due to affiliates: | ||
Management fee received in advance and rebates payable to non-consolidated funds | 7,959 | 4,808 |
Tax receivable agreement liability | 97,698 | 62,505 |
Undistributed carried interest and incentive fees | 64,675 | 27,322 |
Payments made by non-consolidated funds on behalf of and payable by the Company | $ 32,106 | $ 5,551 |
INCOME TAXES - (Details)
INCOME TAXES - (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||||
Income tax expense | $ 30,275 | $ 18,314 | $ 104,487 | $ 22,119 | |
Deferred tax asset | $ 29,900 | $ 29,900 | $ 70,000 |
EARNINGS PER SHARE - Antidiluti
EARNINGS PER SHARE - Antidilutive (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
AOG | ||||
Earnings per common unit | ||||
Antidilutive securities excluded from calculation of earnings per common unit (in shares) | 119,855,724 | 114,726,173 | 115,394,058 | 0 |
Restricted units | ||||
Earnings per common unit | ||||
Antidilutive securities excluded from calculation of earnings per common unit (in shares) | 450 | 572 | 167 | 0 |
EARNINGS PER SHARE - Computatio
EARNINGS PER SHARE - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 16, 2021 | Jun. 16, 2021 | Mar. 17, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Basic earnings per share of Class A and non-voting common stock: | |||||||
Net income attributable to Ares Management Corporation Class A and non-voting common stockholders | $ 84,726 | $ 42,120 | $ 262,659 | $ 56,605 | |||
Distributions on unvested restricted units | (1,440) | (2,757) | (8,142) | (7,715) | |||
Undistributed earnings allocable to participating unvested restricted units | (306) | 0 | (2,858) | 0 | |||
Net income available to Class A and non-voting common stockholders | 82,980 | 39,363 | 251,659 | 48,890 | |||
Diluted earnings per share of Class A and non-voting common stock: | |||||||
Net income available to Class A and non-voting common stockholders | 84,726 | 42,120 | 262,659 | 56,605 | |||
Distributions on unvested restricted units | 0 | 0 | 0 | (7,715) | |||
Net income attributable to Ares Management Corporation Class A and non-voting common stockholders | $ 84,726 | $ 42,120 | $ 262,659 | $ 48,890 | |||
Dividend declared and paid per Class A and non-voting common stock (in dollars per share) | $ 0.47 | $ 0.47 | $ 0.47 | ||||
Restricted units | |||||||
Diluted earnings per share of Class A and non-voting common stock: | |||||||
Effect of dilutive shares (in shares) | 12,273,068 | 9,762,645 | 10,807,242 | 0 | |||
Options | |||||||
Diluted earnings per share of Class A and non-voting common stock: | |||||||
Effect of dilutive shares (in shares) | 5,317,468 | 4,893,709 | 5,265,045 | 0 | |||
Class A Common Stock | |||||||
Basic earnings per share of Class A and non-voting common stock: | |||||||
Basic weighted-average shares of Class A and non-voting common stock (in shares) | 168,931,621 | 143,466,209 | 161,071,151 | 131,866,471 | |||
Basic earnings per share of Class A and non-voting common stock (in dollars per share) | $ 0.49 | $ 0.27 | $ 1.55 | $ 0.37 | |||
Diluted earnings per share of Class A and non-voting common stock: | |||||||
Diluted weighted-average shares of Class A and non-voting common stock (in shares) | 186,522,157 | 158,122,563 | 177,143,438 | 131,866,471 | |||
Diluted earnings per share of Class A and non-voting common stock (in dollars per share) | $ 0.45 | $ 0.27 | $ 1.48 | $ 0.37 | |||
Dividend declared and paid per Class A and non-voting common stock (in dollars per share) | $ 0.47 | $ 0.40 | $ 1.41 | $ 1.20 |
EQUITY COMPENSATION - Equity In
EQUITY COMPENSATION - Equity Incentive Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Jan. 01, 2021 | |
Equity compensation | |||||
Equity-based compensation expense | $ 65,991 | $ 30,336 | $ 191,144 | $ 91,576 | |
Restricted units | |||||
Equity compensation | |||||
Equity-based compensation expense | 36,390 | 30,036 | 127,219 | 86,804 | |
Restricted units with a market condition | |||||
Equity compensation | |||||
Equity-based compensation expense | 29,601 | 300 | 63,925 | 4,729 | |
Options | |||||
Equity compensation | |||||
Equity-based compensation expense | $ 0 | $ 0 | $ 0 | $ 43 | |
Ares Management L.P | |||||
Equity compensation | |||||
Total number of shares available for grant under the equity incentive plan (in shares) | 38,972,964 | 38,972,964 | 44,510,451 |
EQUITY COMPENSATION - Restricte
EQUITY COMPENSATION - Restricted Units (Details) - USD ($) $ / shares in Units, $ in Millions | Sep. 16, 2021 | Jun. 16, 2021 | Mar. 17, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Equity compensation | |||||||
Dividend declared and paid per class A common stock (in dollars per share) | $ 0.47 | $ 0.47 | $ 0.47 | ||||
Distribution equivalents made to holders | $ 6.4 | $ 21.7 | |||||
Class A Common Stock | |||||||
Equity compensation | |||||||
Shares delivered in period | 4,400,000 | 2,600,000 | |||||
Dividend declared and paid per class A common stock (in dollars per share) | $ 0.47 | $ 0.40 | $ 1.41 | $ 1.20 | |||
Restricted units | |||||||
Equity compensation | |||||||
Shares delivered in period | 8,200,000 | 4,700,000 | |||||
Restricted Units | |||||||
Balance at the beginning of the period (in shares) | 16,299,664 | ||||||
Granted (in shares) | 9,667,989 | ||||||
Vested (in shares) | (6,278,948) | ||||||
Forfeited (in shares) | (1,255,502) | ||||||
Balance at the end of the period (in shares) | 18,433,203 | 18,433,203 | |||||
Weighted Average Grant Date Fair Value Per Unit | |||||||
Balance at the beginning of the period (in dollars per share) | $ 24.30 | ||||||
Granted (in dollars per share) | 46.16 | ||||||
Vested (in dollars per share) | 20.70 | ||||||
Forfeited (in dollars per share) | 30.48 | ||||||
Balance at the end of the period (in dollars per share) | $ 36.33 | $ 36.33 | |||||
Unrecognized compensation expenses | $ 504.8 | $ 504.8 | |||||
Weighted average period of compensation expense expected to be recognized | 3 years 6 months | ||||||
Restricted units | Third Anniversary of Grant Date | |||||||
Equity compensation | |||||||
Annual award vesting percentage | 33.33% | ||||||
Restricted units | First Anniversary of Grant Date | |||||||
Equity compensation | |||||||
Annual award vesting percentage | 25.00% | ||||||
Restricted units | First Anniversary | |||||||
Equity compensation | |||||||
Annual award vesting percentage | 33.33% | ||||||
Restricted units | Senior executives | |||||||
Equity compensation | |||||||
Annual award vesting percentage | 25.00% |
EQUITY COMPENSATION - Performan
EQUITY COMPENSATION - Performance-Based Restricted Unit Awards with a Market Condition (Details) - Restricted units with a market condition - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Jan. 31, 2021 | Mar. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | |
Equity compensation | |||||
Granted restricted unit consecutive calendar days | 30 days | ||||
Granted (in shares) | 2,150,000 | ||||
Weighted average grant date fair value (in dollars per share) | $ 0 | $ 0 | |||
Fair Value | |||||
Closing price of the Company's common shares as of valuation date (in dollars per share) | $ 45.76 | ||||
Risk-free interest rate | 0.88% | ||||
Volatility | 35.00% | ||||
Dividend yield | 3.50% | ||||
Cost of equity | 10.00% | ||||
Market Condition Awards Units | |||||
Balance at the beginning of the period (in shares) | 0 | 0 | 0 | ||
Granted (in shares) | 2,150,000 | ||||
Vested (in shares) | (1,925,000) | ||||
Forfeited (in shares) | (225,000) | ||||
Balance at the end of the period (in shares) | 0 | ||||
Weighted Average Grant Date Fair Value Per Unit | |||||
Weighted average grant date fair value (in dollars per share) | $ 0 | $ 0 | |||
Granted (in dollars per share) | 32.86 | ||||
Vested (in dollars per share) | 33.21 | ||||
Forfeited (in dollars per share) | $ 29.84 | ||||
Share-based compensation expense | $ 43.4 | ||||
Tranche I | |||||
Equity compensation | |||||
Granted (in shares) | 537,500 | ||||
Weighted average price of shares purchased (in dollars per share) | $ 55 | ||||
Weighted average grant date fair value (in dollars per share) | $ 37.28 | ||||
Vesting period | 8 months 12 days | ||||
Market Condition Awards Units | |||||
Granted (in shares) | 537,500 | ||||
Weighted Average Grant Date Fair Value Per Unit | |||||
Weighted average grant date fair value (in dollars per share) | $ 37.28 | ||||
Unrecognized compensation expenses | $ 14 | ||||
Tranche II | |||||
Equity compensation | |||||
Granted (in shares) | 537,500 | ||||
Weighted average price of shares purchased (in dollars per share) | $ 60 | ||||
Weighted average grant date fair value (in dollars per share) | $ 34.47 | ||||
Vesting period | 1 year 2 months 12 days | ||||
Market Condition Awards Units | |||||
Granted (in shares) | 537,500 | ||||
Weighted Average Grant Date Fair Value Per Unit | |||||
Weighted average grant date fair value (in dollars per share) | $ 34.47 | ||||
Unrecognized compensation expenses | 29.4 | ||||
Tranche III | |||||
Equity compensation | |||||
Granted (in shares) | 537,500 | ||||
Weighted average price of shares purchased (in dollars per share) | $ 65 | ||||
Weighted average grant date fair value (in dollars per share) | $ 31.92 | ||||
Vesting period | 1 year 7 months 6 days | ||||
Market Condition Awards Units | |||||
Granted (in shares) | 537,500 | ||||
Weighted Average Grant Date Fair Value Per Unit | |||||
Weighted average grant date fair value (in dollars per share) | $ 31.92 | ||||
Unrecognized compensation expenses | 29.4 | ||||
Tranche IV | |||||
Equity compensation | |||||
Granted (in shares) | 537,500 | ||||
Weighted average price of shares purchased (in dollars per share) | $ 75 | ||||
Weighted average grant date fair value (in dollars per share) | $ 27.75 | ||||
Vesting period | 2 years 3 months 18 days | ||||
Market Condition Awards Units | |||||
Granted (in shares) | 537,500 | ||||
Weighted Average Grant Date Fair Value Per Unit | |||||
Weighted average grant date fair value (in dollars per share) | $ 27.75 | ||||
Unrecognized compensation expenses | $ 29.4 |
EQUITY COMPENSATION - Summary O
EQUITY COMPENSATION - Summary Of Options Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Options | ||
Exercised (in shares) | (1,460,388) | |
Aggregate Intrinsic Value | ||
Net cash proceeds from exercises of stock options | $ 27,400 | |
Options | ||
Options | ||
Balance at the beginning of the period (in shares) | 8,312,203 | |
Granted (in shares) | 0 | |
Exercised (in shares) | (1,489,789) | |
Expired (in shares) | 0 | |
Forfeited (in shares) | 0 | |
Balance at the end of the period (in shares) | 6,822,414 | 8,312,203 |
Exercisable at the end of the period (in shares) | 6,822,414 | |
Weighted Average Exercise Price | ||
Balance at the beginning of the period (in dollars per shares) | $ 18.99 | |
Granted (in dollars per shares) | 0 | |
Exercised (in dollars per shares) | 18.94 | |
Expired (in dollars per shares) | 0 | |
Forfeited (in dollars per shares) | 0 | |
Balance at the end of the period (in dollars per shares) | 19 | $ 18.99 |
Exercisable at the end of the period (in dollars per shares) | $ 19 | |
Weighted Average Remaining Life (in years) | ||
Weighted average remaining life | 2 years 7 months 6 days | 3 years 4 months 24 days |
Exercisable at the end of the period | 2 years 7 months 6 days | |
Aggregate Intrinsic Value | ||
Beginning balance | $ 374,073 | $ 233,251 |
Ending balance | 374,073 | $ 233,251 |
Exercisable | 374,073 | |
Employee Stock | ||
Aggregate Intrinsic Value | ||
Tax benefits of exercises | $ 9,600 |
EQUITY AND REDEEMABLE INTERES_2
EQUITY AND REDEEMABLE INTEREST - Common Stock (Details) - USD ($) | Apr. 08, 2021 | Apr. 06, 2021 | Apr. 05, 2021 | Sep. 30, 2021 | Feb. 28, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance (in shares) | 259,631,180 | ||||||
Issuance of stock (in shares) | 24,393,407 | ||||||
Stock option exercises, net of shares withheld for tax (in shares) | 1,460,388 | ||||||
Vesting of restricted stock awards, net of shares withheld for tax (in shares) | 4,448,648 | ||||||
Ending balance (in shares) | 289,875,333 | ||||||
Private Placement | |||||||
Class of Stock [Line Items] | |||||||
Proceeds from sale of shares | $ 250,000,000 | ||||||
Proceeds from issuance of stock | $ 250,000,000 | ||||||
Underwritten | |||||||
Class of Stock [Line Items] | |||||||
Proceeds from issuance of stock | 578,200,000 | ||||||
Fees related to stock issuance | $ 700,000 | ||||||
Ares Operating Group | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Exchanges of AOG units (in shares) | 0 | ||||||
Redemptions of AOG Units (in shares) | (58,290) | ||||||
Class A Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |||||
Authorized amount | $ 150,000,000 | ||||||
Stock repurchase program, number of shares repurchased (in shares) | 0 | 0 | |||||
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance (in shares) | 147,182,562 | ||||||
Issuance of stock (in shares) | 12,159,200 | ||||||
Stock option exercises, net of shares withheld for tax (in shares) | 1,460,388 | ||||||
Vesting of restricted stock awards, net of shares withheld for tax (in shares) | 4,448,648 | ||||||
Ending balance (in shares) | 167,581,165 | ||||||
Class A Common Stock | Private Placement | |||||||
Class of Stock [Line Items] | |||||||
Number of shares sold (in shares) | 1,234,200 | ||||||
Class A Common Stock | Underwritten | |||||||
Class of Stock [Line Items] | |||||||
Number of shares sold (in shares) | 10,925,000 | ||||||
Number of shares sold to underwriters (in shares) | 1,425,000 | ||||||
Class A Common Stock | Ares Operating Group | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Exchanges of AOG units (in shares) | 2,330,367 | ||||||
Redemptions of AOG Units (in shares) | 0 | ||||||
Non- voting Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, par value (in dollars per share) | $ 0.01 | 0.01 | |||||
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance (in shares) | 0 | ||||||
Issuance of stock (in shares) | 3,489,911 | ||||||
Stock option exercises, net of shares withheld for tax (in shares) | 0 | ||||||
Vesting of restricted stock awards, net of shares withheld for tax (in shares) | 0 | ||||||
Ending balance (in shares) | 3,489,911 | ||||||
Non- voting Common Stock | Private Placement | |||||||
Class of Stock [Line Items] | |||||||
Number of shares sold (in shares) | 3,489,911 | ||||||
Non- voting Common Stock | Ares Operating Group | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Exchanges of AOG units (in shares) | 0 | ||||||
Redemptions of AOG Units (in shares) | 0 | ||||||
Class B Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, par value (in dollars per share) | $ 0.01 | 0.01 | |||||
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance (in shares) | 1,000 | ||||||
Issuance of stock (in shares) | 0 | ||||||
Stock option exercises, net of shares withheld for tax (in shares) | 0 | ||||||
Vesting of restricted stock awards, net of shares withheld for tax (in shares) | 0 | ||||||
Ending balance (in shares) | 1,000 | ||||||
Class B Common Stock | Ares Operating Group | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Exchanges of AOG units (in shares) | 0 | ||||||
Redemptions of AOG Units (in shares) | 0 | ||||||
Class C Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |||||
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance (in shares) | 112,447,618 | ||||||
Issuance of stock (in shares) | 8,744,296 | ||||||
Stock option exercises, net of shares withheld for tax (in shares) | 0 | ||||||
Vesting of restricted stock awards, net of shares withheld for tax (in shares) | 0 | ||||||
Ending balance (in shares) | 118,803,257 | ||||||
Class C Common Stock | Ares Operating Group | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Exchanges of AOG units (in shares) | (2,330,367) | ||||||
Redemptions of AOG Units (in shares) | (58,290) |
EQUITY AND REDEEMABLE INTERES_3
EQUITY AND REDEEMABLE INTEREST - Common Stock Offering (Details) - shares | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Class of Stock [Line Items] | |||||
AOG units (in shares) | 289,874,333 | 289,874,333 | 259,630,180 | ||
Ares Operating Group | |||||
Class of Stock [Line Items] | |||||
Direct Ownership Interest | 100.00% | 100.00% | 100.00% | ||
Ares Owners Holdings, L.P. | |||||
Class of Stock [Line Items] | |||||
AOG units (in shares) | 118,803,257 | 118,803,257 | 112,447,618 | ||
Ares Owners Holdings, L.P. | Ares Operating Group | |||||
Class of Stock [Line Items] | |||||
Direct Ownership Interest | 40.98% | 40.98% | 43.31% | ||
Daily Average Ownership | 41.50% | 44.43% | 41.74% | 46.67% | |
Ares Operating Group | |||||
Class of Stock [Line Items] | |||||
AOG units (in shares) | 171,071,076 | 171,071,076 | 147,182,562 | ||
Ares Operating Group | Ares Operating Group | |||||
Class of Stock [Line Items] | |||||
Direct Ownership Interest | 59.02% | 59.02% | 56.69% | ||
Daily Average Ownership | 58.50% | 55.57% | 58.26% | 53.33% |
EQUITY AND REDEEMABLE INTERES_4
EQUITY AND REDEEMABLE INTEREST - Preferred Stock (Details) - Series A Preferred Stock - USD ($) $ / shares in Units, $ in Millions | Jun. 30, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | ||
Dividend rate, percentage | 7.00% | |
Redemption price (in dollars per share) | $ 25 | |
Dividends, preferred stock, cash | $ 310 | |
Preferred dividends in arrears value | $ 5.4 | |
Preferred stock dividends per share declared (in dollars per share) | $ 0.4375 | |
Fees related to stock issuance | $ 11.2 | |
Preferred Equity | ||
Class of Stock [Line Items] | ||
Partners' capital (in shares) | 12,400,000 |
EQUITY AND REDEEMABLE INTERES_5
EQUITY AND REDEEMABLE INTEREST - Redeemable Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | |
Ares Operating Group | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Beginning balance | $ 100,031 | $ 99,808 | $ 100,366 |
Net income | 324 | 337 | 32 |
Currency translation adjustment, net of tax | (356) | 186 | (590) |
Distribution | (1,350) | (300) | |
Ending balance | 98,649 | 100,031 | 99,808 |
Consolidated Funds | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Beginning balance | 916,824 | 930,924 | 0 |
Change in redemption value | 83,176 | (14,100) | 930,924 |
Ending balance | $ 1,000,000 | $ 916,824 | $ 930,924 |
SEGMENT REPORTING - Operating S
SEGMENT REPORTING - Operating Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment reporting | ||||
Total revenues | $ 948,719 | $ 489,866 | $ 2,901,926 | $ 1,106,033 |
Compensation and benefits | (335,569) | (837,108) | ||
General, administrative and other expenses | (134,453) | (285,471) | ||
Operating segment | ||||
Segment reporting | ||||
Fee related earnings | (273,140) | (167,901) | (683,075) | (468,685) |
Performance income—realized | 45,341 | 123,265 | 249,989 | 319,660 |
Performance related compensation—realized | (33,728) | (97,538) | (185,306) | (252,575) |
Realized net investment income (loss) | 5,356 | 14,494 | 20,454 | 39,372 |
Realized income (loss) | (290,109) | (208,122) | (768,212) | (575,142) |
OMG | ||||
Segment reporting | ||||
Total revenues | (3,446) | 0 | (3,446) | 0 |
Compensation and benefits | (66,107) | (41,551) | (158,943) | (114,916) |
General, administrative and other expenses | (28,142) | (19,519) | (69,872) | (56,877) |
Fee related earnings | (90,803) | (61,070) | (225,369) | (171,793) |
Performance income—realized | 0 | 0 | 0 | 0 |
Performance related compensation—realized | 0 | 0 | 0 | 0 |
Realized net performance income | 0 | 0 | 0 | 0 |
Investment income (loss)—realized | 0 | 0 | 0 | (5,698) |
Interest and other investment income (expense)—realized | (270) | (503) | 170 | (588) |
Interest expense | (160) | (141) | (397) | (1,262) |
Realized net investment income (loss) | (430) | (644) | (227) | (7,548) |
Realized income (loss) | (91,233) | (61,714) | (225,596) | (179,341) |
Total | ||||
Segment reporting | ||||
Compensation and benefits | (225,813) | (154,400) | (577,711) | (442,325) |
General, administrative and other expenses | (59,097) | (43,811) | (146,183) | (125,285) |
Fee related earnings | 182,337 | 106,831 | 457,706 | 296,892 |
Performance income—realized | 45,341 | 123,265 | 249,989 | 319,660 |
Performance related compensation—realized | (33,728) | (97,538) | (185,306) | (252,575) |
Realized net performance income | 11,613 | 25,727 | 64,683 | 67,085 |
Investment income (loss)—realized | 5,362 | 16,837 | 12,695 | 32,065 |
Interest and other investment income (expense)—realized | 11,087 | 3,828 | 32,657 | 17,962 |
Interest expense | (11,523) | (6,815) | (25,125) | (18,203) |
Realized net investment income (loss) | 4,926 | 13,850 | 20,227 | 31,824 |
Realized income (loss) | 198,876 | 146,408 | 542,616 | 395,801 |
Ares Management L.P | ||||
Segment reporting | ||||
Total revenues | 948,719 | 489,866 | 2,901,926 | 1,106,033 |
Compensation and benefits | (335,569) | (194,267) | (837,108) | (559,482) |
General, administrative and other expenses | (134,453) | (69,938) | (285,471) | (190,353) |
Ares Management L.P | Operating segment | ||||
Segment reporting | ||||
Compensation and benefits | (159,706) | (112,849) | (418,768) | (327,409) |
General, administrative and other expenses | (30,955) | (24,292) | (76,311) | (68,408) |
Fee related earnings | 273,140 | 167,901 | 683,075 | 468,685 |
Performance income—realized | 45,341 | 123,265 | 249,989 | 319,660 |
Performance related compensation—realized | (33,728) | (97,538) | (185,306) | (252,575) |
Realized net performance income | 11,613 | 25,727 | 64,683 | 67,085 |
Investment income (loss)—realized | 5,362 | 16,837 | 12,695 | 37,763 |
Interest and other investment income (expense)—realized | 11,357 | 4,331 | 32,487 | 18,550 |
Interest expense | (11,363) | (6,674) | (24,728) | (16,941) |
Realized net investment income (loss) | 5,356 | 14,494 | 20,454 | 39,372 |
Realized income (loss) | 290,109 | 208,122 | 768,212 | 575,142 |
Ares Management L.P | Operating segment | Credit Group | ||||
Segment reporting | ||||
Compensation and benefits | (86,502) | (74,373) | (252,783) | (222,063) |
General, administrative and other expenses | (14,930) | (13,789) | (37,716) | (41,626) |
Fee related earnings | 175,957 | 125,107 | 492,697 | 354,964 |
Performance income—realized | 6,332 | 7,069 | 78,255 | 16,085 |
Performance related compensation—realized | (3,079) | (4,131) | (49,433) | (12,142) |
Realized net performance income | 3,253 | 2,938 | 28,822 | 3,943 |
Investment income (loss)—realized | 618 | 0 | 1,858 | (843) |
Interest and other investment income (expense)—realized | 4,716 | 1,962 | 14,354 | 13,166 |
Interest expense | (2,392) | (2,340) | (5,372) | (6,391) |
Realized net investment income (loss) | 2,942 | (378) | 10,840 | 5,932 |
Realized income (loss) | 182,152 | 127,667 | 532,359 | 364,839 |
Ares Management L.P | Operating segment | Private Equity Group | ||||
Segment reporting | ||||
Compensation and benefits | (26,773) | (21,224) | (73,534) | (62,946) |
General, administrative and other expenses | (6,238) | (6,002) | (17,499) | (16,083) |
Fee related earnings | 36,950 | 27,429 | 80,712 | 81,319 |
Performance income—realized | 34,316 | 115,997 | 159,479 | 276,469 |
Performance related compensation—realized | (27,483) | (93,284) | (127,706) | (222,949) |
Realized net performance income | 6,833 | 22,713 | 31,773 | 53,520 |
Investment income (loss)—realized | 2,020 | 16,351 | 5,308 | 35,866 |
Interest and other investment income (expense)—realized | 4,861 | 1,065 | 10,716 | 2,364 |
Interest expense | (2,726) | (2,216) | (6,032) | (6,106) |
Realized net investment income (loss) | 4,155 | 15,200 | 9,992 | 32,124 |
Realized income (loss) | 47,938 | 65,342 | 122,477 | 166,963 |
Ares Management L.P | Operating segment | Real Estate Group | ||||
Segment reporting | ||||
Compensation and benefits | (29,160) | (13,011) | (60,767) | (38,159) |
General, administrative and other expenses | (5,420) | (2,987) | (12,064) | (9,185) |
Fee related earnings | 24,261 | 7,794 | 47,375 | 24,831 |
Performance income—realized | 4,693 | 199 | 12,255 | 27,106 |
Performance related compensation—realized | (3,166) | (123) | (8,167) | (17,484) |
Realized net performance income | 1,527 | 76 | 4,088 | 9,622 |
Investment income (loss)—realized | 1,699 | 486 | 4,182 | 2,740 |
Interest and other investment income (expense)—realized | 918 | 1,308 | 3,892 | 3,024 |
Interest expense | (1,683) | (1,389) | (3,930) | (3,715) |
Realized net investment income (loss) | 934 | 405 | 4,144 | 2,049 |
Realized income (loss) | 26,722 | 8,275 | 55,607 | 36,502 |
Ares Management L.P | Operating segment | Secondary Solutions Group | ||||
Segment reporting | ||||
Compensation and benefits | (11,955) | 0 | (16,244) | 0 |
General, administrative and other expenses | (2,593) | 0 | (3,452) | 0 |
Fee related earnings | 26,516 | 0 | 34,266 | 0 |
Performance income—realized | 0 | 0 | 0 | 0 |
Performance related compensation—realized | 0 | 0 | 0 | 0 |
Realized net performance income | 0 | 0 | 0 | 0 |
Investment income (loss)—realized | 0 | 0 | 0 | 0 |
Interest and other investment income (expense)—realized | 699 | 0 | 701 | 0 |
Interest expense | (427) | 0 | (432) | 0 |
Realized net investment income (loss) | 272 | 0 | 269 | 0 |
Realized income (loss) | 26,788 | 0 | 34,535 | 0 |
Ares Management L.P | Operating segment | Strategic Initiatives | ||||
Segment reporting | ||||
Compensation and benefits | (5,316) | (4,241) | (15,440) | (4,241) |
General, administrative and other expenses | (1,774) | (1,514) | (5,580) | (1,514) |
Fee related earnings | 9,456 | 7,571 | 28,025 | 7,571 |
Performance income—realized | 0 | 0 | 0 | 0 |
Performance related compensation—realized | 0 | 0 | 0 | 0 |
Realized net performance income | 0 | 0 | 0 | 0 |
Investment income (loss)—realized | 1,025 | 0 | 1,347 | 0 |
Interest and other investment income (expense)—realized | 163 | (4) | 2,824 | (4) |
Interest expense | (4,135) | (729) | (8,962) | (729) |
Realized net investment income (loss) | (2,947) | (733) | (4,791) | (733) |
Realized income (loss) | 6,509 | 6,838 | 23,234 | 6,838 |
Management fees | ||||
Segment reporting | ||||
Total revenues | 448,262 | 1,135,821 | ||
Management fees | OMG | ||||
Segment reporting | ||||
Total revenues | 0 | 0 | 0 | 0 |
Management fees | Total | ||||
Segment reporting | ||||
Total revenues | 453,950 | 300,131 | 1,154,248 | 851,581 |
Management fees | Ares Management L.P | ||||
Segment reporting | ||||
Total revenues | 448,262 | 292,434 | 1,135,821 | 823,150 |
Management fees | Ares Management L.P | Operating segment | ||||
Segment reporting | ||||
Total revenues | 453,950 | 300,131 | 1,154,248 | 851,581 |
Management fees | Ares Management L.P | Operating segment | Credit Group | ||||
Segment reporting | ||||
Total revenues | 271,591 | 208,371 | 764,702 | 606,596 |
Management fees | Ares Management L.P | Operating segment | Private Equity Group | ||||
Segment reporting | ||||
Total revenues | 69,591 | 54,653 | 171,019 | 160,206 |
Management fees | Ares Management L.P | Operating segment | Real Estate Group | ||||
Segment reporting | ||||
Total revenues | 55,160 | 23,787 | 115,602 | 71,459 |
Management fees | Ares Management L.P | Operating segment | Secondary Solutions Group | ||||
Segment reporting | ||||
Total revenues | 41,064 | 0 | 53,962 | 0 |
Management fees | Ares Management L.P | Operating segment | Strategic Initiatives | ||||
Segment reporting | ||||
Total revenues | 16,544 | 13,320 | 48,963 | 13,320 |
Other fees | OMG | ||||
Segment reporting | ||||
Total revenues | 3,446 | 0 | 3,446 | 0 |
Other fees | Total | ||||
Segment reporting | ||||
Total revenues | 13,297 | 4,911 | 27,352 | 12,921 |
Other fees | Ares Management L.P | Operating segment | ||||
Segment reporting | ||||
Total revenues | 9,851 | 4,911 | 23,906 | 12,921 |
Other fees | Ares Management L.P | Operating segment | Credit Group | ||||
Segment reporting | ||||
Total revenues | 5,798 | 4,898 | 18,494 | 12,057 |
Other fees | Ares Management L.P | Operating segment | Private Equity Group | ||||
Segment reporting | ||||
Total revenues | 370 | 2 | 726 | 142 |
Other fees | Ares Management L.P | Operating segment | Real Estate Group | ||||
Segment reporting | ||||
Total revenues | 3,681 | 5 | 4,604 | 716 |
Other fees | Ares Management L.P | Operating segment | Secondary Solutions Group | ||||
Segment reporting | ||||
Total revenues | 0 | 0 | 0 | 0 |
Other fees | Ares Management L.P | Operating segment | Strategic Initiatives | ||||
Segment reporting | ||||
Total revenues | $ 2 | $ 6 | $ 82 | $ 6 |
SEGMENT REPORTING - Revenue, Ex
SEGMENT REPORTING - Revenue, Expenses and Realized Net Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment revenues | ||||
Total revenues | $ 948,719 | $ 489,866 | $ 2,901,926 | $ 1,106,033 |
Total segment revenues | 509,142 | 428,307 | 1,428,143 | 1,184,162 |
Segment expenses | ||||
Compensation and benefits | 335,569 | 837,108 | ||
General, administrative and other expenses | 134,453 | 285,471 | ||
Total expenses | 813,267 | 392,580 | 2,363,108 | 958,106 |
Segment other income | ||||
Total other income (expense) | 111,536 | 62,355 | 218,011 | (43,602) |
Management fees | ||||
Segment revenues | ||||
Total revenues | 448,262 | 1,135,821 | ||
Operating segment | ||||
Segment revenues | ||||
Performance income—realized | 45,341 | 123,265 | 249,989 | 319,660 |
Segment expenses | ||||
Total performance related compensation—realized | 33,728 | 97,538 | 185,306 | 252,575 |
Ares Management L.P | ||||
Segment revenues | ||||
Total revenues | 948,719 | 489,866 | 2,901,926 | 1,106,033 |
Segment expenses | ||||
Compensation and benefits | 335,569 | 194,267 | 837,108 | 559,482 |
General, administrative and other expenses | 134,453 | 69,938 | 285,471 | 190,353 |
Ares Management L.P | Management fees | ||||
Segment revenues | ||||
Total revenues | 448,262 | 292,434 | 1,135,821 | 823,150 |
Ares Management L.P | Operating segment | ||||
Segment revenues | ||||
Performance income—realized | 45,341 | 123,265 | 249,989 | 319,660 |
Total segment revenues | 509,142 | 428,307 | 1,428,143 | 1,184,162 |
Segment expenses | ||||
Compensation and benefits | 159,706 | 112,849 | 418,768 | 327,409 |
General, administrative and other expenses | 30,955 | 24,292 | 76,311 | 68,408 |
Total performance related compensation—realized | 33,728 | 97,538 | 185,306 | 252,575 |
Total expenses | 224,389 | 234,679 | 680,385 | 648,392 |
Segment other income | ||||
Investment income—realized | 5,362 | 16,837 | 12,695 | 37,763 |
Interest and other investment income—realized | 11,357 | 4,331 | 32,487 | 18,550 |
Interest expense | (11,363) | (6,674) | (24,728) | (16,941) |
Total other income (expense) | 5,356 | 14,494 | 20,454 | 39,372 |
Ares Management L.P | Operating segment | Management fees | ||||
Segment revenues | ||||
Total revenues | 453,950 | 300,131 | 1,154,248 | 851,581 |
Ares Management L.P | Operating segment | Other fees | ||||
Segment revenues | ||||
Total revenues | $ 9,851 | $ 4,911 | $ 23,906 | $ 12,921 |
SEGMENT REPORTING - Revenue Rec
SEGMENT REPORTING - Revenue Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue adjustment | ||||
Total revenues | $ 948,719 | $ 489,866 | $ 2,901,926 | $ 1,106,033 |
Principal investment income, net of eliminations | (5,356) | (14,494) | (20,454) | (39,372) |
Total segment revenue | 509,142 | 428,307 | 1,428,143 | 1,184,162 |
Ares Management L.P | ||||
Revenue adjustment | ||||
Total revenues | 948,719 | 489,866 | 2,901,926 | 1,106,033 |
Operating segment | Ares Management L.P | ||||
Revenue adjustment | ||||
Performance (income) loss—unrealized | (415,317) | (52,488) | (1,381,697) | 77,866 |
Total segment revenue | 509,142 | 428,307 | 1,428,143 | 1,184,162 |
Reconciling items | ||||
Revenue adjustment | ||||
Principal investment income, net of eliminations | (20,719) | (18,080) | (96,448) | 24,951 |
Total segment revenue | (439,577) | (61,559) | (1,473,783) | 78,129 |
Reconciling items | Non-Controlling interest | Subsidiaries | ||||
Revenue adjustment | ||||
Total segment revenue | (6,927) | (4,323) | (16,795) | (5,808) |
Reconciling items | Performance income reclass | ||||
Revenue adjustment | ||||
Performance income (loss) reclass | 680 | (291) | 1,285 | (3,664) |
OMG | ||||
Revenue adjustment | ||||
Total revenues | (3,446) | 0 | (3,446) | 0 |
Management fees | ||||
Revenue adjustment | ||||
Total revenues | 448,262 | 1,135,821 | ||
Management fees | Ares Management L.P | ||||
Revenue adjustment | ||||
Total revenues | 448,262 | 292,434 | 1,135,821 | 823,150 |
Management fees | Operating segment | Ares Management L.P | ||||
Revenue adjustment | ||||
Total revenues | 453,950 | 300,131 | 1,154,248 | 851,581 |
Management fees | OMG | ||||
Revenue adjustment | ||||
Total revenues | 0 | 0 | 0 | 0 |
Management fees | Consolidated Funds | Eliminations | ||||
Revenue adjustment | ||||
Total segment revenue | 11,051 | 11,719 | 33,416 | 33,601 |
Incentive fees | ||||
Revenue adjustment | ||||
Total revenues | 696 | 19,420 | ||
Incentive fees | Ares Management L.P | ||||
Revenue adjustment | ||||
Total revenues | 696 | 7,194 | 19,420 | 4,276 |
Incentive fees | Consolidated Funds | Eliminations | ||||
Revenue adjustment | ||||
Total revenues | 0 | 0 | 1,528 | (70) |
Administrative, transaction and other fees | ||||
Revenue adjustment | ||||
Total revenues | 24,860 | 49,501 | ||
Administrative, transaction and other fees | Ares Management L.P | ||||
Revenue adjustment | ||||
Total revenues | 24,860 | 9,852 | 49,501 | 28,897 |
Administrative, transaction and other fees | Reconciling items | ||||
Revenue adjustment | ||||
Total revenues | (15,632) | (9,216) | (34,754) | (27,715) |
Administrative, transaction and other fees | Consolidated Funds | Reconciling items | ||||
Revenue adjustment | ||||
Total revenues | 4,264 | 4,448 | 13,157 | 12,249 |
Principal investment income | ||||
Revenue adjustment | ||||
Total revenues | 14,250 | 86,477 | ||
Principal investment income | Ares Management L.P | ||||
Revenue adjustment | ||||
Total revenues | 14,250 | 11,408 | 86,477 | 8,330 |
Principal investment income | Reconciling items | ||||
Revenue adjustment | ||||
Principal investment income, net of eliminations | $ (14,250) | $ (11,408) | $ (86,477) | $ (8,330) |
SEGMENT REPORTING - Expenses (D
SEGMENT REPORTING - Expenses (Details) - USD ($) $ in Thousands | Jun. 02, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Expenses | $ 813,267 | $ 392,580 | $ 2,363,108 | $ 958,106 | |
Acquisition and merger-related expense | $ 4,900 | ||||
Equity compensation expense | 65,991 | 30,336 | 191,144 | 91,576 | |
Operating segment | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Acquisition and merger-related expense | 7,967 | 3,490 | 26,188 | 9,815 | |
Equity compensation expense | 65,991 | 30,336 | 191,144 | 91,576 | |
Acquisition-related compensation expense | (28,194) | 0 | (32,824) | 0 | |
Deferred placement fees | 32,413 | 2,942 | 33,740 | 18,677 | |
Depreciation and amortization expense | 36,668 | 14,336 | 71,742 | 26,197 | |
Operating segment | Ares Management L.P | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Expenses | 224,389 | 234,679 | 680,385 | 648,392 | |
Performance related compensation-unrealized | (296,044) | (24,818) | (1,022,393) | 61,010 | |
Operating segment | Consolidated Funds | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Expenses | 813,267 | 392,580 | 2,363,108 | 958,106 | |
Reconciling items | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Expenses | (588,878) | (157,901) | (1,682,723) | (309,714) | |
Administrative fees | (15,632) | (9,216) | (34,754) | (27,715) | |
Acquisition and merger-related expense | (754) | (3,474) | (18,364) | (9,430) | |
Equity compensation expense | (65,991) | (30,336) | (191,144) | (91,576) | |
Acquisition-related compensation expense | (28,194) | 0 | (32,824) | 0 | |
Deferred placement fees | (32,413) | (2,942) | (33,740) | (18,677) | |
Depreciation and amortization expense | (36,668) | (14,336) | (71,742) | (26,197) | |
Reconciling items | Non-Controlling interest | Subsidiaries | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Expenses | (6,829) | (5,690) | (17,372) | (8,630) | |
Reconciling items | Consolidated Funds | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Expenses of Consolidated Funds added in consolidation | (23,206) | (17,737) | (66,653) | (50,237) | |
Expenses of Consolidated Funds eliminated in consolidation | 11,102 | 11,718 | 35,078 | 33,531 | |
OMG | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Expenses | $ 94,249 | $ 61,070 | $ 228,815 | $ 171,793 |
SEGMENT REPORTING - Other Incom
SEGMENT REPORTING - Other Income (Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Total segment realized net investment income | $ 111,536 | $ 62,355 | $ 218,011 | $ (43,602) |
Other income, net | 36,654 | 30,686 | ||
Principal investment income (loss) | 5,356 | 14,494 | 20,454 | 39,372 |
Ares Management L.P | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Other income, net | 36,654 | 2,203 | 30,686 | 9,848 |
Operating segment | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Total investment (income) loss—unrealized | (5,014) | 89 | (57,531) | 73,039 |
Other (income) expense, net | 42,025 | (9,518) | 42,490 | (9,518) |
Operating segment | Ares Management L.P | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Total segment realized net investment income | 5,356 | 14,494 | 20,454 | 39,372 |
Total investment (income) loss—unrealized | (3,609) | 1,479 | (60,588) | 83,369 |
Interest and other investment (income) loss—unrealized | (1,405) | (1,390) | 3,057 | (10,330) |
Operating segment | Consolidated Funds | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Total segment realized net investment income | 111,536 | 62,355 | 218,011 | (43,602) |
Reconciling items | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Total segment realized net investment income | (106,180) | (47,861) | (197,557) | 82,974 |
Principal investment income (loss) | 20,719 | 18,080 | 96,448 | (24,951) |
Other (income) expense, net | (34,812) | 9,534 | (34,666) | 9,903 |
Reconciling items | Subsidiaries | Non-Controlling interest | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Total segment realized net investment income | (5,170) | (2,433) | (9,191) | 12,859 |
Reconciling items | Performance income reclass | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Performance (income) loss reclass | (680) | 291 | (1,285) | 3,664 |
Reconciling items | Consolidated Funds | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Other (income) loss from Consolidated Funds added in consolidation, net | (76,287) | (68,132) | (178,195) | 20,719 |
Eliminations | Consolidated Funds | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Other income, net | (4,973) | (3,470) | (13,783) | (11,478) |
OMG | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Total segment realized net investment income | $ (37) | $ 1,820 | $ (646) | $ 781 |
SEGMENT REPORTING - Reconciliat
SEGMENT REPORTING - Reconciliation of Income Before Taxes (Details) - USD ($) $ in Thousands | Jun. 02, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Economic net income | |||||
Income before taxes | $ 246,988 | $ 159,641 | $ 756,829 | $ 104,325 | |
Adjustments: | |||||
Equity compensation expense | 65,991 | 30,336 | 191,144 | 91,576 | |
Acquisition and merger-related expense | $ 4,900 | ||||
Consolidated Funds | |||||
Adjustments: | |||||
(Income) loss before taxes of non-controlling interests in Consolidated Funds, net of eliminations | 47,370 | 42,627 | 102,255 | (38,593) | |
Total investment income—realized | (104,028) | (116,581) | (333,745) | (346,120) | |
Operating segment | |||||
Economic net income | |||||
Income before taxes | 246,988 | 159,641 | 756,829 | 104,325 | |
Adjustments: | |||||
Depreciation and amortization expense | 36,668 | 14,336 | 71,742 | 26,197 | |
Equity compensation expense | 65,991 | 30,336 | 191,144 | 91,576 | |
Acquisition-related compensation expense | 28,194 | 0 | 32,824 | 0 | |
Acquisition and merger-related expense | 7,967 | 3,490 | 26,188 | 9,815 | |
Deferred placement fees | 32,413 | 2,942 | 33,740 | 18,677 | |
Other (income) expense, net | (42,025) | 9,518 | (42,490) | 9,518 | |
Total performance (income) loss—unrealized | (415,317) | (52,488) | (1,381,697) | 77,866 | |
Total performance related compensation—unrealized | 296,044 | 24,818 | 1,022,393 | (61,010) | |
Total investment (income) loss—unrealized | (5,014) | 89 | (57,531) | 73,039 | |
Realized income | 290,109 | 208,122 | 768,212 | 575,142 | |
Total performance income—realized | (45,341) | (123,265) | (249,989) | (319,660) | |
Total performance related compensation—realized | 33,728 | 97,538 | 185,306 | 252,575 | |
Total investment income—realized | (5,356) | (14,494) | (20,454) | (39,372) | |
Fee related earnings | 273,140 | 167,901 | 683,075 | 468,685 | |
Operating segment | Consolidated Funds | |||||
Adjustments: | |||||
(Income) loss before taxes of non-controlling interests in Consolidated Funds, net of eliminations | (47,372) | (42,744) | (102,331) | 38,446 | |
OMG | |||||
Adjustments: | |||||
OMG expense, net | 90,840 | 59,250 | 226,015 | 171,012 | |
Realized income | 91,233 | 61,714 | 225,596 | 179,341 | |
Total performance income—realized | 0 | 0 | 0 | 0 | |
Total performance related compensation—realized | 0 | 0 | 0 | 0 | |
Total investment income—realized | 430 | 644 | 227 | 7,548 | |
Fee related earnings | 90,803 | 61,070 | 225,369 | 171,793 | |
Subsidiaries | Operating segment | |||||
Adjustments: | |||||
(Income) loss before taxes of non-controlling interests in Consolidated Funds, net of eliminations | $ (5,268) | $ (1,066) | $ (8,614) | $ 15,681 |
CONSOLIDATION - Variable Intere
CONSOLIDATION - Variable Interest Entities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Variable Interest Entity [Line Items] | |||||
Assets of consolidated VIEs | $ 19,934,398 | $ 19,934,398 | $ 15,168,992 | ||
Liabilities of consolidated VIEs | 15,295,223 | 15,295,223 | 12,596,852 | ||
Collateralized loan obligations and other fixed income, at fair value | |||||
Variable Interest Entity [Line Items] | |||||
Maximum exposure to loss attributable to the company's investment in VIEs | 104,400 | 104,400 | 107,700 | ||
Consolidated Funds | |||||
Variable Interest Entity [Line Items] | |||||
Net income (loss) attributable to non-controlling interests related to consolidated VIEs | 47,370 | $ 42,627 | 102,255 | $ (38,593) | |
Non-Consolidated Variable Interest Entities | |||||
Variable Interest Entity [Line Items] | |||||
Maximum exposure to loss attributable to the company's investment in VIEs | 340,988 | 340,988 | 224,203 | ||
Consolidated VIEs | |||||
Variable Interest Entity [Line Items] | |||||
Maximum exposure to loss attributable to the company's investment in VIEs | 478,164 | 478,164 | 391,963 | ||
Consolidated VIEs | Consolidated Funds | |||||
Variable Interest Entity [Line Items] | |||||
Assets of consolidated VIEs | 12,190,617 | 12,190,617 | 11,580,003 | ||
Liabilities of consolidated VIEs | 11,238,928 | 11,238,928 | $ 10,716,438 | ||
Net income (loss) attributable to non-controlling interests related to consolidated VIEs | $ 38,597 | $ 42,627 | $ 84,285 | $ (38,593) |
CONSOLIDATION - Balance Sheet (
CONSOLIDATION - Balance Sheet (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||||||||
Intangible assets, net | $ 798,690 | $ 222,088 | ||||||
Total assets | 19,934,398 | 15,168,992 | ||||||
Liabilities | ||||||||
Operating lease liabilities | 214,681 | |||||||
Total liabilities | 15,295,223 | 12,596,852 | ||||||
Commitments and contingencies | ||||||||
Stockholders' Equity | ||||||||
Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (zero and 12,400,000 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively) | 0 | 298,761 | ||||||
Additional paid-in-capital | 1,881,913 | 1,043,669 | ||||||
Retained earnings | (128,981) | (151,824) | ||||||
Accumulated other comprehensive loss, net of tax | (2,571) | 483 | ||||||
Total stockholders' equity | 1,753,260 | 1,193,685 | ||||||
Total equity | 3,540,526 | $ 3,441,115 | $ 2,420,568 | 2,471,774 | $ 2,370,881 | $ 2,003,748 | $ 1,975,596 | $ 1,858,598 |
Total liabilities, redeemable interest, non-controlling interests and equity | $ 19,934,398 | $ 15,168,992 | ||||||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||||
Preferred stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 | ||||||
Preferred stock, shares issued (in shares) | 0 | 12,400,000 | ||||||
Preferred stock, shares outstanding (in shares) | 0 | 12,400,000 | ||||||
Common stock, shares outstanding (in shares) | 289,875,333 | 259,631,180 | ||||||
Class A Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | $ 1,676 | $ 1,472 | ||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||||
Common stock, shares authorized (in shares) | 1,500,000,000 | 1,500,000,000 | ||||||
Common stock, shares issued (in shares) | 167,581,165 | 147,182,562 | ||||||
Common stock, shares outstanding (in shares) | 167,581,165 | 147,182,562 | ||||||
Non- voting Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | $ 35 | $ 0 | ||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||||
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 | ||||||
Common stock, shares issued (in shares) | 3,489,911 | 0 | ||||||
Common stock, shares outstanding (in shares) | 3,489,911 | 0 | ||||||
Class B Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | $ 0 | $ 0 | ||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||||
Common stock, shares authorized (in shares) | 1,000 | 1,000 | ||||||
Common stock, shares issued (in shares) | 1,000 | 1,000 | ||||||
Common stock, shares outstanding (in shares) | 1,000 | 1,000 | ||||||
Class C Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | $ 1,188 | $ 1,124 | ||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||||
Common stock, shares authorized (in shares) | 499,999,000 | 499,999,000 | ||||||
Common stock, shares issued (in shares) | 118,803,257 | 112,447,618 | ||||||
Common stock, shares outstanding (in shares) | 118,803,257 | 112,447,618 | ||||||
Eliminations | ||||||||
Assets | ||||||||
Total assets | $ (511,267) | $ (408,733) | ||||||
Liabilities | ||||||||
Total liabilities | (88,354) | (84,888) | ||||||
Commitments and contingencies | ||||||||
Stockholders' Equity | ||||||||
Total equity | (422,913) | (323,845) | ||||||
Total liabilities, redeemable interest, non-controlling interests and equity | (511,267) | (408,733) | ||||||
Consolidated Funds | ||||||||
Assets | ||||||||
Cash and cash equivalents | 1,581,433 | 522,377 | ||||||
U.S. Treasury securities, at fair value | 1,000,165 | 0 | ||||||
Investments, at fair value | 10,360,854 | 10,877,097 | ||||||
Due from affiliates | 9,059 | 17,172 | ||||||
Receivable for securities sold | 187,230 | 121,225 | ||||||
Other assets | 47,806 | 35,502 | ||||||
Liabilities | ||||||||
Accounts payable, accrued expenses and other liabilities | 89,685 | 46,824 | ||||||
Due to affiliates | 0 | 0 | ||||||
Payable for securities purchased | 863,007 | 514,946 | ||||||
CLO loan obligations, at fair value | 10,174,794 | 9,958,076 | ||||||
Fund borrowings | 99,240 | 121,909 | ||||||
Redeemable interest | 1,000,000 | 916,824 | 930,924 | 0 | ||||
Non-controlling interests in Consolidated Funds | 464,400 | 539,720 | ||||||
Consolidated Funds | Reportable legal entity | ||||||||
Assets | ||||||||
Cash and cash equivalents | 1,581,433 | 522,377 | ||||||
U.S. Treasury securities, at fair value | 1,000,165 | |||||||
Investments, at fair value | 10,356,640 | 10,873,522 | ||||||
Due from affiliates | 19,089 | 27,377 | ||||||
Receivable for securities sold | 187,230 | 121,225 | ||||||
Other assets | 47,806 | 35,502 | ||||||
Total assets | 13,192,363 | 11,580,003 | ||||||
Liabilities | ||||||||
Accounts payable, accrued expenses and other liabilities | 102,883 | 46,824 | ||||||
Due to affiliates | 19,880 | 16,770 | ||||||
Payable for securities purchased | 863,007 | 514,946 | ||||||
CLO loan obligations, at fair value | 10,220,040 | 10,015,989 | ||||||
Fund borrowings | 99,240 | 121,909 | ||||||
Total liabilities | 11,305,050 | 10,716,438 | ||||||
Commitments and contingencies | ||||||||
Redeemable interest | 1,000,000 | |||||||
Non-controlling interests in Consolidated Funds | 887,313 | 863,565 | ||||||
Stockholders' Equity | ||||||||
Total equity | 887,313 | 863,565 | ||||||
Total liabilities, redeemable interest, non-controlling interests and equity | 13,192,363 | 11,580,003 | ||||||
Consolidated Funds | Eliminations | ||||||||
Assets | ||||||||
Investments, at fair value | 4,214 | 3,575 | ||||||
Due from affiliates | (10,030) | (10,205) | ||||||
Liabilities | ||||||||
Accounts payable, accrued expenses and other liabilities | (13,198) | |||||||
Due to affiliates | (19,880) | (16,770) | ||||||
CLO loan obligations, at fair value | (45,246) | (57,913) | ||||||
Non-controlling interests in Consolidated Funds | (422,913) | (323,845) | ||||||
Ares Operating Group | ||||||||
Liabilities | ||||||||
Redeemable interest | 98,649 | $ 100,031 | $ 99,808 | 100,366 | ||||
Non-controlling interests in Ares Operating Group entities | 1,322,866 | 738,369 | ||||||
Ares Operating Group | Reportable legal entity | ||||||||
Liabilities | ||||||||
Non-controlling interests in Ares Operating Group entities | 1,322,866 | 738,369 | ||||||
Ares Management L.P | ||||||||
Assets | ||||||||
Cash and cash equivalents | 295,704 | 539,812 | ||||||
Total investments | 3,322,665 | 1,682,759 | ||||||
Due from affiliates | 493,411 | 405,887 | ||||||
Other assets | 1,006,870 | 590,332 | ||||||
Intangible assets, net | 1,452,690 | 222,087 | ||||||
Right-of-use operating lease assets | 176,511 | 154,742 | ||||||
Liabilities | ||||||||
Accounts payable, accrued expenses and other liabilities | 208,141 | 115,289 | ||||||
Accrued compensation | 309,569 | 103,010 | ||||||
Due to affiliates | 202,438 | 100,186 | ||||||
Performance related compensation payable | 1,895,343 | 813,378 | ||||||
Debt obligations | 1,238,325 | 642,998 | ||||||
Operating lease liabilities | 214,681 | 180,236 | ||||||
Stockholders' Equity | ||||||||
Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (zero and 12,400,000 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively) | 0 | 298,761 | ||||||
Additional paid-in-capital | 1,881,913 | 1,043,669 | ||||||
Retained earnings | (128,981) | (151,824) | ||||||
Accumulated other comprehensive loss, net of tax | (2,571) | 483 | ||||||
Total stockholders' equity | 1,753,260 | 1,193,685 | ||||||
Ares Management L.P | Carried interest | ||||||||
Stockholders' Equity | ||||||||
Equity method investments: | 2,625,319 | 1,145,853 | ||||||
Ares Management L.P | Class A Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 1,676 | 1,472 | ||||||
Ares Management L.P | Non- voting Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 35 | |||||||
Ares Management L.P | Class B Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 0 | 0 | ||||||
Ares Management L.P | Class C Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 1,188 | 1,124 | ||||||
Ares Management L.P | Reportable legal entity | ||||||||
Assets | ||||||||
Cash and cash equivalents | 295,704 | 539,812 | ||||||
Total investments | 3,804,023 | 2,064,517 | ||||||
Due from affiliates | 517,504 | 426,021 | ||||||
Other assets | 1,006,870 | 590,543 | ||||||
Intangible assets, net | 1,452,690 | 222,087 | ||||||
Right-of-use operating lease assets | 176,511 | 154,742 | ||||||
Total assets | 7,253,302 | 3,997,722 | ||||||
Liabilities | ||||||||
Accounts payable, accrued expenses and other liabilities | 218,171 | 125,494 | ||||||
Accrued compensation | 309,569 | 103,010 | ||||||
Due to affiliates | 202,438 | 100,186 | ||||||
Performance related compensation payable | 1,895,343 | 813,378 | ||||||
Debt obligations | 1,238,325 | 642,998 | ||||||
Operating lease liabilities | 214,681 | 180,236 | ||||||
Total liabilities | 4,078,527 | 1,965,302 | ||||||
Commitments and contingencies | ||||||||
Stockholders' Equity | ||||||||
Series A Preferred Stock, $0.01 par value, 1,000,000,000 shares authorized (zero and 12,400,000 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively) | 0 | 298,761 | ||||||
Additional paid-in-capital | 1,881,913 | 1,043,669 | ||||||
Retained earnings | (128,981) | (151,824) | ||||||
Accumulated other comprehensive loss, net of tax | (2,571) | 483 | ||||||
Total stockholders' equity | 1,753,260 | 1,193,685 | ||||||
Total equity | 3,076,126 | 1,932,054 | ||||||
Total liabilities, redeemable interest, non-controlling interests and equity | 7,253,302 | 3,997,722 | ||||||
Ares Management L.P | Reportable legal entity | Class A Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 1,676 | 1,472 | ||||||
Ares Management L.P | Reportable legal entity | Non- voting Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 35 | |||||||
Ares Management L.P | Reportable legal entity | Class B Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 0 | |||||||
Ares Management L.P | Reportable legal entity | Class C Common Stock | ||||||||
Stockholders' Equity | ||||||||
Common stock | 1,188 | 1,124 | ||||||
Ares Management L.P | Eliminations | ||||||||
Assets | ||||||||
Total investments | (481,358) | (381,758) | ||||||
Due from affiliates | (24,093) | (20,134) | ||||||
Other assets | (211) | |||||||
Liabilities | ||||||||
Accounts payable, accrued expenses and other liabilities | (10,030) | (10,205) | ||||||
Ares Management L.P | Ares Operating Group | Reportable legal entity | ||||||||
Liabilities | ||||||||
Redeemable interest | $ 98,649 | $ 100,366 |
CONSOLIDATION - Income Statemen
CONSOLIDATION - Income Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenues | ||||
Total revenues | $ 948,719 | $ 489,866 | $ 2,901,926 | $ 1,106,033 |
Expenses | ||||
Compensation and benefits | 335,569 | 837,108 | ||
Performance related compensation | 331,141 | 1,208,954 | ||
General, administrative and other expenses | 134,453 | 285,471 | ||
Total expenses | 813,267 | 392,580 | 2,363,108 | 958,106 |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 8,334 | 18,744 | ||
Interest and dividend income | 1,376 | 6,818 | ||
Interest expense | (11,523) | (25,125) | ||
Other income (expense), net | 36,654 | 30,686 | ||
Total other income (expense) | 111,536 | 62,355 | 218,011 | (43,602) |
Income (loss) before taxes | 246,988 | 159,641 | 756,829 | 104,325 |
Income tax expense | 30,275 | 18,314 | 104,487 | 22,119 |
Net income (loss) | 216,713 | 141,327 | 652,342 | 82,206 |
Net income attributable to Ares Management Corporation | 84,726 | 47,545 | 284,748 | 72,880 |
Less: Series A Preferred Stock dividends paid | 0 | 5,425 | 10,850 | 16,275 |
Less: Series A Preferred Stock redemption premium | 0 | 0 | 11,239 | 0 |
Net income attributable to Ares Management Corporation Class A and non-voting common stockholders | 84,726 | 42,120 | 262,659 | 56,605 |
Eliminations | ||||
Revenues | ||||
Total revenues | (21,784) | (22,839) | (58,072) | (12,499) |
Expenses | ||||
Compensation and benefits | 0 | 0 | ||
Performance related compensation | 0 | 0 | ||
General, administrative and other expenses | 0 | 0 | ||
Total expenses | (11,102) | (11,718) | (35,078) | (33,531) |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 5,575 | (4,910) | 8,142 | 15,009 |
Interest and dividend income | (1,326) | (258) | (2,877) | (2,990) |
Other income (expense), net | 316 | 8,540 | (175) | 8,748 |
Total other income (expense) | 4,973 | 3,470 | 13,783 | 11,478 |
Income (loss) before taxes | (5,709) | (7,651) | (9,211) | 32,510 |
Income tax expense | 0 | 0 | ||
Net income (loss) | (5,709) | (7,651) | (9,211) | 32,510 |
Less: Series A Preferred Stock dividends paid | 0 | |||
Net income attributable to Ares Management Corporation Class A and non-voting common stockholders | 0 | 0 | 0 | |
Consolidated Funds | ||||
Expenses | ||||
Expenses of Consolidated Funds | 12,104 | 6,019 | 31,575 | 16,706 |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 34,245 | 17,971 | 44,720 | (153,268) |
Interest expense | (61,578) | (66,322) | (191,577) | (222,860) |
Interest and other income of Consolidated Funds | 104,028 | 116,581 | 333,745 | 346,120 |
Less: Net income (loss) attributable to non-controlling interests | 47,370 | 42,627 | 102,255 | (38,593) |
Consolidated Funds | Reportable legal entity | ||||
Revenues | ||||
Total revenues | 0 | 0 | 0 | 0 |
Expenses | ||||
Expenses of Consolidated Funds | 23,206 | 17,737 | 66,653 | 50,237 |
Total expenses | 23,206 | 17,737 | 66,653 | 50,237 |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 36,695 | 9,850 | 46,541 | (148,826) |
Interest expense | (64,752) | (67,818) | (201,916) | (227,532) |
Interest and other income of Consolidated Funds | 104,344 | 126,100 | 333,570 | 355,639 |
Total other income (expense) | 76,287 | 68,132 | 178,195 | (20,719) |
Income (loss) before taxes | 53,081 | 50,395 | 111,542 | (70,956) |
Income tax expense | 2 | 117 | 76 | 147 |
Net income (loss) | 53,079 | 50,278 | 111,466 | (71,103) |
Less: Net income (loss) attributable to non-controlling interests | 53,079 | 50,278 | 111,466 | (71,103) |
Consolidated Funds | Eliminations | ||||
Expenses | ||||
Expenses of Consolidated Funds | (11,102) | (11,718) | (35,078) | (33,531) |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | (2,450) | 8,121 | (1,821) | (4,442) |
Interest expense | 3,174 | 1,496 | 10,339 | 4,672 |
Interest and other income of Consolidated Funds | (316) | (9,519) | 175 | (9,519) |
Less: Net income (loss) attributable to non-controlling interests | (5,709) | (7,651) | (9,211) | 32,510 |
Ares Operating Group | ||||
Other income (expense) | ||||
Net income (loss) | 169,343 | 98,700 | 550,087 | 120,799 |
Less: Net income (loss) attributable to non-controlling interests | 84,293 | 52,162 | 264,646 | 48,926 |
Less: Net income (loss) attributable to redeemable interest | 324 | (1,007) | 693 | (1,007) |
Ares Operating Group | Reportable legal entity | ||||
Other income (expense) | ||||
Less: Net income (loss) attributable to non-controlling interests | 48,926 | |||
Ares Operating Group | Eliminations | ||||
Other income (expense) | ||||
Net income (loss) | 0 | |||
Less: Net income (loss) attributable to non-controlling interests | 0 | |||
Consolidated Company Entities | ||||
Revenues | ||||
Total revenues | 948,719 | 489,866 | 2,901,926 | 1,106,033 |
Expenses | ||||
Compensation and benefits | 335,569 | 194,267 | 837,108 | 559,482 |
Performance related compensation | 331,141 | 122,356 | 1,208,954 | 191,565 |
General, administrative and other expenses | 134,453 | 69,938 | 285,471 | 190,353 |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 8,334 | (2,607) | 18,744 | (10,351) |
Interest and dividend income | 1,376 | 1,344 | 6,818 | 5,112 |
Interest expense | (11,523) | (6,815) | (25,125) | (18,203) |
Other income (expense), net | 36,654 | 2,203 | 30,686 | 9,848 |
Consolidated Company Entities | Reportable legal entity | ||||
Revenues | ||||
Total revenues | 970,503 | 512,705 | 2,959,998 | 1,118,532 |
Expenses | ||||
Compensation and benefits | 335,569 | 194,267 | 837,108 | 559,482 |
Performance related compensation | 331,141 | 122,356 | 1,208,954 | 191,565 |
General, administrative and other expenses | 134,453 | 69,938 | 285,471 | 190,353 |
Total expenses | 801,163 | 386,561 | 2,331,533 | 941,400 |
Other income (expense) | ||||
Net realized and unrealized gains (losses) on investments | 2,759 | 2,303 | 10,602 | (25,360) |
Interest and dividend income | 2,702 | 1,602 | 9,695 | 8,102 |
Interest expense | (11,523) | (6,815) | (25,125) | (18,203) |
Other income (expense), net | 36,338 | (6,337) | 30,861 | 1,100 |
Total other income (expense) | 30,276 | (9,247) | 26,033 | (34,361) |
Income (loss) before taxes | 199,616 | 116,897 | 654,498 | 142,771 |
Income tax expense | 30,273 | 18,197 | 104,411 | 21,972 |
Net income (loss) | 169,343 | 98,700 | 550,087 | 120,799 |
Net income attributable to Ares Management Corporation | 47,545 | 284,748 | 72,880 | |
Less: Series A Preferred Stock dividends paid | 5,425 | 10,850 | 16,275 | |
Less: Series A Preferred Stock redemption premium | 11,239 | |||
Net income attributable to Ares Management Corporation Class A and non-voting common stockholders | 84,726 | 42,120 | 262,659 | 56,605 |
Consolidated Company Entities | Consolidated Funds | Reportable legal entity | ||||
Other income (expense) | ||||
Less: Net income (loss) attributable to non-controlling interests | 0 | |||
Consolidated Company Entities | Ares Operating Group | Reportable legal entity | ||||
Other income (expense) | ||||
Net income (loss) | 169,343 | 98,700 | 550,087 | 120,799 |
Less: Net income (loss) attributable to non-controlling interests | 84,293 | 52,162 | 264,646 | |
Less: Net income (loss) attributable to redeemable interest | 324 | (1,007) | 693 | (1,007) |
Management fees | ||||
Revenues | ||||
Total revenues | 448,262 | 1,135,821 | ||
Management fees | Eliminations | ||||
Revenues | ||||
Total revenues | (11,051) | (11,719) | (33,416) | (33,601) |
Management fees | Consolidated Company Entities | ||||
Revenues | ||||
Total revenues | 448,262 | 292,434 | 1,135,821 | 823,150 |
Management fees | Consolidated Company Entities | Reportable legal entity | ||||
Revenues | ||||
Total revenues | 459,313 | 304,153 | 1,169,237 | 856,751 |
Carried interest allocation | ||||
Revenues | ||||
Total revenues | 460,651 | 1,610,707 | ||
Carried interest allocation | Eliminations | ||||
Revenues | ||||
Total revenues | 0 | 0 | ||
Carried interest allocation | Consolidated Company Entities | ||||
Revenues | ||||
Total revenues | 460,651 | 168,978 | 1,610,707 | 241,380 |
Carried interest allocation | Consolidated Company Entities | Reportable legal entity | ||||
Revenues | ||||
Total revenues | 460,651 | 168,978 | 1,610,707 | 241,380 |
Incentive fees | ||||
Revenues | ||||
Total revenues | 696 | 19,420 | ||
Incentive fees | Eliminations | ||||
Revenues | ||||
Total revenues | 0 | 0 | (1,528) | 70 |
Incentive fees | Consolidated Company Entities | ||||
Revenues | ||||
Total revenues | 696 | 7,194 | 19,420 | 4,276 |
Incentive fees | Consolidated Company Entities | Reportable legal entity | ||||
Revenues | ||||
Total revenues | 696 | 7,194 | 20,948 | 4,206 |
Principal investment income | ||||
Revenues | ||||
Total revenues | 14,250 | 86,477 | ||
Principal investment income | Eliminations | ||||
Revenues | ||||
Total revenues | (6,469) | (6,672) | (9,971) | 33,281 |
Principal investment income | Consolidated Company Entities | ||||
Revenues | ||||
Total revenues | 14,250 | 11,408 | 86,477 | 8,330 |
Principal investment income | Consolidated Company Entities | Reportable legal entity | ||||
Revenues | ||||
Total revenues | 20,719 | 18,080 | 96,448 | (24,951) |
Administrative, transaction and other fees | ||||
Revenues | ||||
Total revenues | 24,860 | 49,501 | ||
Administrative, transaction and other fees | Eliminations | ||||
Revenues | ||||
Total revenues | (4,264) | (4,448) | (13,157) | (12,249) |
Administrative, transaction and other fees | Consolidated Company Entities | ||||
Revenues | ||||
Total revenues | 24,860 | 9,852 | 49,501 | 28,897 |
Administrative, transaction and other fees | Consolidated Company Entities | Reportable legal entity | ||||
Revenues | ||||
Total revenues | $ 29,124 | $ 14,300 | $ 62,658 | $ 41,146 |
CONSOLIDATION - Cash Flow State
CONSOLIDATION - Cash Flow Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||||
Net income | $ 216,713 | $ 141,327 | $ 652,342 | $ 82,206 |
Net cash provided by (used in) operating activities | (1,843,751) | 12,462 | ||
Cash flows from investing activities: | ||||
Net cash used in investing activities | (1,072,578) | (126,437) | ||
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||||
Net cash provided by financing activities | 2,692,984 | 827,550 | ||
Effect of exchange rate changes | (20,763) | 16,793 | ||
Net change in cash and cash equivalents | (244,108) | 730,368 | ||
Cash and cash equivalents, beginning of period | 539,812 | |||
Cash and cash equivalents, end of period | 295,704 | 868,752 | 295,704 | 868,752 |
Supplemental disclosure of non-cash financing activities: | ||||
Issuance of AOG Units in connection with acquisitions | 511,069 | 305,338 | ||
Reportable legal entity | ||||
Cash flows from financing activities: | ||||
Proceeds from issuance of senior and subordinated notes | 399,084 | |||
Redemption of Series A Preferred Stock | (310,000) | |||
Eliminations | ||||
Cash flows from operating activities: | ||||
Net income | (5,709) | (7,651) | (9,211) | 32,510 |
Net cash provided by (used in) operating activities | (969,200) | |||
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||||
Net cash provided by financing activities | (89,857) | 10,804 | ||
Effect of exchange rate changes | 0 | 0 | ||
Net change in cash and cash equivalents | (1,059,057) | 241,137 | ||
Cash and cash equivalents, beginning of period | (522,377) | (606,321) | ||
Cash and cash equivalents, end of period | (1,581,434) | (365,185) | (1,581,434) | (365,185) |
Consolidated Funds | ||||
Cash flows from operating activities: | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities | (1,688,085) | (766,399) | ||
Cash flows due to changes in operating assets and liabilities | (729,703) | 366,367 | ||
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||||
Contributions from redeemable and non-controlling interests in Consolidated Funds | 919,666 | 123,713 | ||
Distributions to non-controlling interests in Consolidated Funds | (84,770) | (169,747) | ||
Borrowings under loan obligations by Consolidated Funds | 1,456,887 | 618,207 | ||
Repayments under loan obligations by Consolidated Funds | (74,909) | (104,794) | ||
Consolidated Funds | Reportable legal entity | ||||
Cash flows from operating activities: | ||||
Net income | 53,079 | 50,278 | 111,466 | (71,103) |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | (1,697,529) | (733,607) | ||
Cash flows due to changes in operating assets and liabilities | 343,253 | 105,992 | ||
Net cash provided by (used in) operating activities | (1,242,810) | (698,718) | ||
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||||
Contributions from redeemable and non-controlling interests in Consolidated Funds | 1,027,454 | 138,760 | ||
Distributions to non-controlling interests in Consolidated Funds | (102,701) | (195,598) | ||
Borrowings under loan obligations by Consolidated Funds | 1,456,887 | 618,207 | ||
Repayments under loan obligations by Consolidated Funds | (74,909) | (104,794) | ||
Net cash provided by financing activities | 2,306,731 | 456,575 | ||
Effect of exchange rate changes | (4,864) | 1,007 | ||
Net change in cash and cash equivalents | 1,059,057 | (241,137) | ||
Cash and cash equivalents, beginning of period | 522,377 | 606,321 | ||
Cash and cash equivalents, end of period | 1,581,434 | 365,185 | 1,581,434 | 365,185 |
Consolidated Funds | Eliminations | ||||
Cash flows from operating activities: | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities | 9,444 | (32,792) | ||
Cash flows due to changes in operating assets and liabilities | (1,072,956) | 260,375 | ||
Net cash provided by (used in) operating activities | 230,332 | |||
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||||
Contributions from redeemable and non-controlling interests in Consolidated Funds | (107,788) | (15,047) | ||
Distributions to non-controlling interests in Consolidated Funds | 17,931 | 25,851 | ||
Borrowings under loan obligations by Consolidated Funds | 0 | |||
Repayments under loan obligations by Consolidated Funds | 0 | |||
Ares Management L.P | ||||
Cash flows from operating activities: | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities | 71,133 | 184,586 | ||
Cash flows due to changes in operating assets and liabilities | (149,438) | 145,702 | ||
Cash flows from investing activities: | ||||
Purchase of furniture, equipment and leasehold improvements, net of disposals | (15,152) | (8,608) | ||
Acquisitions, net of cash acquired | (1,057,426) | (117,829) | ||
Cash flows from financing activities: | ||||
Net proceeds from issuance of Class A and non-voting common stock | 827,430 | 383,154 | ||
Proceeds from Credit Facility | 468,000 | 790,000 | ||
Proceeds from issuance of senior and subordinated notes | 450,000 | 399,084 | ||
Repayments of Credit Facility | (318,000) | (860,000) | ||
Dividends and distributions | (438,568) | (334,957) | ||
Series A Preferred Stock dividends | (10,850) | (16,275) | ||
Redemption of Series A Preferred Stock | (310,000) | 0 | ||
Stock option exercises | 27,409 | 78,959 | ||
Taxes paid related to net share settlement of equity awards | (221,287) | (75,657) | ||
Other financing activities | 1,976 | (4,137) | ||
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||||
Cash and cash equivalents, beginning of period | 539,812 | 138,384 | ||
Cash and cash equivalents, end of period | 295,704 | 868,752 | 295,704 | 868,752 |
Ares Management L.P | Reportable legal entity | ||||
Cash flows from operating activities: | ||||
Net income | 169,343 | 98,700 | 550,087 | 120,799 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | (28,467) | 207,358 | ||
Cash flows due to changes in operating assets and liabilities | (153,361) | 152,691 | ||
Net cash provided by (used in) operating activities | 368,259 | 480,848 | ||
Cash flows from investing activities: | ||||
Purchase of furniture, equipment and leasehold improvements, net of disposals | (15,152) | (8,608) | ||
Acquisitions, net of cash acquired | (1,057,426) | (117,829) | ||
Net cash used in investing activities | (1,072,578) | (126,437) | ||
Cash flows from financing activities: | ||||
Net proceeds from issuance of Class A and non-voting common stock | 827,430 | 383,154 | ||
Proceeds from Credit Facility | 468,000 | 790,000 | ||
Proceeds from issuance of senior and subordinated notes | 450,000 | |||
Repayments of Credit Facility | (318,000) | (860,000) | ||
Dividends and distributions | (438,568) | (334,957) | ||
Series A Preferred Stock dividends | (10,850) | (16,275) | ||
Stock option exercises | 27,409 | 78,959 | ||
Taxes paid related to net share settlement of equity awards | (221,287) | (75,657) | ||
Other financing activities | 1,976 | (4,137) | ||
Allocable to redeemable and non-controlling interests in Consolidated Funds: | ||||
Net cash provided by financing activities | 476,110 | 360,171 | ||
Effect of exchange rate changes | (15,899) | 15,786 | ||
Net change in cash and cash equivalents | (244,108) | 730,368 | ||
Cash and cash equivalents, beginning of period | 539,812 | 138,384 | ||
Cash and cash equivalents, end of period | $ 295,704 | $ 868,752 | 295,704 | 868,752 |
Supplemental disclosure of non-cash financing activities: | ||||
Issuance of AOG Units in connection with acquisitions | 511,069 | 305,388 | ||
Ares Management L.P | Eliminations | ||||
Cash flows from operating activities: | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities | 99,600 | (22,772) | ||
Cash flows due to changes in operating assets and liabilities | $ 3,923 | $ (6,989) |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) | 1 Months Ended |
Oct. 31, 2021$ / shares | |
Subsequent event | |
Subsequent events | |
Quarterly distribution declared (in dollars per share) | $ 0.47 |