Key Takeaways
- • KKR Prisma and PAAMCO merge to form PAAMCO Prisma Holdings, creating one of the largest liquid alternatives firms with over $30 billion in assets under management or advisement.
- • Ownership structure: Employees of both firms will own 60.1% of the combined business, while KKR retains a 39.9% stake as a long-term strategic partner, enabling the new entity to operate independently.
- • PAAMCO brings $24 billion in AUM with institutional alternative investment expertise since its 2000 founding; KKR Prisma contributes approximately $10 billion in AUM specializing in customized hedge fund portfolios and liquid alternatives.
- • Jane Buchan, co-Founder and CEO of PAAMCO, and Girish Reddy, co-Founder of KKR Prisma and Head of KKR Hedge Funds, will jointly lead the combined business.
- • The merger consolidates two established brands under a single operating entity while preserving core investment and client teams, positioning the firm to serve a broad spectrum of liquid alternatives investor needs.
Summary
KKR and Pacific Alternative Asset Management Company announced a strategic merger on February 6, 2017, combining their respective liquid alternatives platforms into PAAMCO Prisma Holdings. The transaction unites two significant players in the alternatives space: PAAMCO, a leading institutional alternative investment manager founded in 2000 with $24 billion in assets under management or advisement, and KKR Prisma, KKR's hedge fund business managing approximately $10 billion in customized hedge fund portfolios and liquid alternatives products. The combined entity will operate as an independent firm with over $30 billion in total AUM or assets under advisement.
The ownership structure reflects a balance between independence and KKR's strategic commitment. Employees of both PAAMCO and KKR Prisma will collectively own 60.1% of the new company, establishing majority employee ownership and operational autonomy. KKR will maintain a 39.9% ownership stake as a long-term strategic partner, providing capital and strategic support without controlling day-to-day operations. This arrangement signals KKR's confidence in the combined platform while enabling the business to function independently and make decisions aligned with client and employee interests.
Leadership of the merged entity will be shared between Jane Buchan, co-Founder and CEO of PAAMCO, and Girish Reddy, co-Founder of KKR Prisma and Head of KKR Hedge Funds, who will jointly run the combined business. The transaction structure preserves the core investment and client teams from both organizations, maintaining continuity in investment strategies and client relationships. PAAMCO Prisma Holdings will operate under a unified brand while leveraging the complementary strengths of both legacy businesses—PAAMCO's institutional expertise and product breadth alongside KKR Prisma's specialized hedge fund portfolio construction capabilities—to serve a comprehensive range of liquid alternatives investor requirements.
The ownership structure reflects a balance between independence and KKR's strategic commitment. Employees of both PAAMCO and KKR Prisma will collectively own 60.1% of the new company, establishing majority employee ownership and operational autonomy. KKR will maintain a 39.9% ownership stake as a long-term strategic partner, providing capital and strategic support without controlling day-to-day operations. This arrangement signals KKR's confidence in the combined platform while enabling the business to function independently and make decisions aligned with client and employee interests.
Leadership of the merged entity will be shared between Jane Buchan, co-Founder and CEO of PAAMCO, and Girish Reddy, co-Founder of KKR Prisma and Head of KKR Hedge Funds, who will jointly run the combined business. The transaction structure preserves the core investment and client teams from both organizations, maintaining continuity in investment strategies and client relationships. PAAMCO Prisma Holdings will operate under a unified brand while leveraging the complementary strengths of both legacy businesses—PAAMCO's institutional expertise and product breadth alongside KKR Prisma's specialized hedge fund portfolio construction capabilities—to serve a comprehensive range of liquid alternatives investor requirements.
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