BREAKING NEWS: TPG Buys Asset Manager Angelo Gordon for $2.7B to Expand Credit, Real Estate

Private equity firm TPG Inc. has agreed to buy private credit and real estate investment firm Angelo Gordon in a cash and equity deal worth $2.7 billion.

The transaction includes an estimated $970 million in cash, which will be funded from TPG’s current cash balance and undrawn revolver, and up to 62.5 million common units of the TPG Operating Group and restricted stock units of TPG.

The transaction also includes an earnout based on Angelo Gordon’s future financial performance, valued at up to $400 million.

The deal marks a significant expansion into credit investing for the San Fransico-based TPG, which manages $137 billion in assets, and extends its real estate reach in Europe and Asia.

Angelo Gordon will become a significant new investment platform within TPG. Angelo Gordon’s co-CEOs, Josh Baumgarten and Adam Schwartz, will become co-managing partners of the platform, reporting to TPG CEO, Jon Winkelried.

The transaction will provide the firm with “scale to capitalize on the growing opportunity set we see in the credit and real estate markets,” said Baumgarten.

Founded in 1988, New York City-based Angelo Gordon is among the largest players in rapidly growing private credit markets, managing $73 billion in assets – $55 billion in credit and $18 billion in real estate – with 650 employees globally. It is regarded as complementary to TPG’s existing investment operations, which are mostly focused on private equity investments.