TPG's AUM up 65% in Q2 due in part to Angelo Gordon acquisition

TPG’s $229 billion of total assets under management as of June 30 was boosted 65% year-over-year by the alternative investment firm’s acquisition of $75 billion credit and real estate manager Angelo Gordon.

TPG’s acquisition of Angelo Gordon closed in November. In addition to the Angelo Gordon transaction close, TPG raised $23 billion and created $11 billion of value in the year ended June 30. This was offset by $17 billion of realizations over the 12-month period.

TPG’s AUM inched up by a more modest 2% from the prior quarter, partially driven by fundraising, the firm reported. TPG raised $6.3 billion in the second quarter, with more than 70% of the capital, or $4.5 billion, raised across the firm’s credit strategies, CEO Jon Winkelried said on an Aug. 6 earnings call.

In its credit solutions business, an all-weather distressed and special situations strategy called TPG Angelo Gordon Credit Solutions, the team has actively been, liquidating and selling most of the public securities it acquired “over the course of 2023, and maybe early '24 … given the spread tightening,” Winkelried said.

TPG switched to private investment opportunities, he said.

“We pivoted, as you would expect, given the nature of what's happening in terms of the refinancing challenges in the market for some of the highly levered companies,” Winkelried said.

As a measure of the scope of potential investment activity, so far this year, TPG executives signed 160 nondisclosure agreements, which is double its prior flow base, he said.

While those deals are structured and take longer to get done, there should be a future uptick in private deals “particularly with … the increase in volatility in the market,” Winkelried said.

And he said he thinks the markets will remain volatile and it is unclear how that will impact the economy.

“Based on the market correction we've all witnessed over the last few days, it seems likely we've entered a new period of increased volatility, marked by more imminent interest rate cuts and heightened geopolitical risks,” he said.

“From our perspective, the fundamentals we look at every day remain reasonably strong” and that periods of market dislocation tend to create compelling investment opportunities, Winkelried added.