NEW YORK, April 11 Oaktree Capital Management
sold fewer shares than expected in an initial public
offering that priced at the bottom of an expected range on
Wednesday, a market source said.
The tepid response to the IPO raised concerns that investors
have become wary of private equity manager flotations, including
the upcoming offering from Carlyle Group LP.
Oaktree, which had $75 billion of assets under management as
of the end of 2011, priced 8.84 million shares at $43, raising
$380.3 million. It had intended to sell 11.3 million shares at
between $43 and $46 each.
Oaktree's IPO is viewed by some investors as a litmus test
for Carlyle's IPO. That firm is kicking off a road show next
week, according to sources familiar with the situation, seeking
a valuation of $7.5 billion to $8 billion.
Private equity firms have faced a rocky road, with public
market investors struggling to value performance fees in their
funds. Blackstone, the world's largest private equity firm, has
lost around half its market value since its IPO in 2007.
Proceeds from Oaktree's IPO will be used to buy back
so-called OCGH units, which represent economic interests in the
Oaktree Operating Group. Oaktree co-founders Howard Marks and
Bruce Karsh each own 15.6 percent of the total OCGH units.
Marks and Karsh founded Oaktree in 1995. The two each had a
net worth of $1.5 billion as of March 2012, according to Forbes.
Oaktree's IPO underwriters include Goldman Sachs and Morgan
Stanley. Los Angeles-based Oaktree will begin trading on the
New York Stock Exchange on Thursday under the ticker "OAK."