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Governance

Genstar Capital acquires proxy-advisory firm ISS for $720 million

Genstar Capital will acquire proxy-advisory firm Institutional Shareholder Services from Vestar Capital Partners for $720 million, said a joint news release from ISS and the private equity firms.

Following the transaction, which is expected to close by early in the fourth quarter, ISS will continue to operate independently and the entire team is expected to remain in place, said Subodh Mishra, executive director at ISS, in an email. ISS' name will also be retained, he said.

"While maintaining its status as the premier governance provider, ISS has expanded significantly over the past three years, exhibiting a deep commitment to its clients by building a robust infrastructure and continuing to develop a world-class suite of ESG solutions," said Tony Salewski, managing director at Genstar, in the release. "We are excited to back Gary Retelny (ISS' president and CEO) and his team in building on this progress through both organic and acquisition growth initiatives globally."

ISS has about 3,000 clients, including pension funds and other institutional investors. Vestar acquired ISS from MSCI for $364 million in 2014.

Genstar Capital manages funds with about $9 billion in total commitments.

Simpson Thacher & Bartlett served as legal adviser to ISS and Vestar Capital Partners; Willkie Farr & Gallagher to Genstar Capital; and Davis Polk & Wardwell to ISS' management.