Legg Mason said it will acquire a 75% stake in the alternative asset manager. RARE’s management team will have a 15% equity stake and the Treasury Group, a previous minority owner, will retain 10%.
RARE specialises in global listed infrastructure investments and manages assets of $7.6bn for institutional and retail clients.
The market for infrastructure investing has grown significantly over the past few years, said Joseph Sullivan, chairman and chief executive of Legg Mason.
“We believe that global demand for these liquid, long-dated assets will continue to grow and that we can leverage RARE’s existing geographic presence into additional important markets that Legg Mason’s global distribution platform serves in the US, Asia and Europe,” said Sullivan.
RARE will operate as an independent investment affiliate along with Legg Mason’s existing affiliates.
“This partnership provides continuity and sustainability for our clients with no change to the investment team or process,” said Richard Elmslie, founder and co-CEO of RARE said.
The infrastructure manager has a 15-person investment team and its institutional client base is global.
RARE was set up in 2006 and focuses on investing in global listed infrastructure companies and developments such as airports, gas, electricity, water and roads.
Demand for alternative investments in growing among institutions and high net worth individuals in Asia, according to separate reports by Allianz Global, Natixis and Principal Global Investors.
PIMCO also recently said it wants to expand its alternatives business.
