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Pretium, Ares Management Agree USD 2.4bn Take-Private Transaction with Front Yard Residential
Tuesday 20 October 2020

US-based alternative investment management firm Pretium and a group of its investors and funds managed by the Real Estate Equity and Alternative Credit strategies of Ares Management Corp. (NYSE: ARES) have forged a strategic partnership to acquire -family rental housing provider Front Yard Residential Corp. (NYSE: RESI) in an all-cash transaction that values Front Yard at USD 2.4bn, the firms said.

The transaction demonstrates investors' increasing demand for SFR assets and the unique investment opportunities available to operators such as Pretium that possess the requisite scale to drive margins. Pretium led the transaction and will manage the venture following closing.

Upon completion of the transaction, Pretium will become the second-largest owner and operator of SFR properties in the United States with a portfolio of more than 55,000 cash-flowing single-family rentals throughout the country.

The transaction is expected to close in 1Q21, subject to the satisfaction of customary closing conditions.

RBC Capital Markets, LLC is serving as financial advisor to Pretium. BofA Securities is serving as financial advisor to Ares. Sidley Austin is serving as M and A legal counsel, Fried Frank as partnership legal counsel, and Hunton Andrews Kurth as special tax and financing counsel to Pretium. Latham and Watkins is serving as legal counsel to Ares.

Pretium is a specialized alternative investment management firm focused on residential real estate, mortgage finance, and corporate credit.

Pretium was founded in 2012 to capitalise on secular investment and lending opportunities arising as a result of structural changes, disruptions, and inefficiencies within the economy, the residential housing sector, and mortgage finance markets.

Pretium's platform has more than USD 16bn of assets under management as of October 1, 2020 and employs approximately 1,500 employees across 26 offices.

Progress Residential is in intelligent single-family rental management services, with people, technology, scale, and data-driven solutions that streamline operations, optimize asset performance, and provide an exceptional renting and living experience for our residents.
Date Published: 20/10/2020