Westwood Holdings Group, an investment management boutique and wealth manager, will acquire Salient Partners in a deal expected to close by the end of the year.
Westwood will make an upfront payment of $35 million when the deal closes, with deferred payments of up to $25 million over several years thereafter dependent on certain revenue retention and growth targets, confirmed Tyler Bradford, a Westwood spokesman, in an email.
Salient manages a total of $4.5 billion: energy infrastructure ($2.5 billion); real estate ($306 million); energy and real estate private investment vehicles ($286 million); and $1.4 billion in liquid tactical equity mutual funds and separate accounts that are subadvised by Broadmark Asset Management.
Broadmark will remain the subadviser of these funds after Salient is acquired by Westwood, the company said in a news release.
The addition of Salient's assets will increase Westwood's AUM by 32% to $18.4 billion, the news release said.
Westwood, Salient and Broadmark's strategies will retain their current names until the deal is completed. Their names will be changed over time, Mr. Bradford said.
The current investment teams will remain in place and will continue to manage their strategies, he added.
Houston-based Salient Partners will move to an office adjacent to Westwood's Houston office, Mr. Bradford said. Westwood's headquarters is in Dallas.
Salient's "additional investment strategies are designed to provide solutions that we believe investors are increasingly seeking, including alternative sources of income, real assets with inflation protection, low correlation to traditional asset classes and volatility mitigation," said Brian O. Casey, Westwood's president and CEO, in the release.
"Westwood's strong institutional relationships and robust distribution infrastructure will enable us to capitalize on the demand for energy infrastructure and real estate investments," said Gregory A. Reid, a Salient partner, president and energy infrastructure portfolio manager, in the release.