September 8, 2014 / 11:15 AM / 4 years ago

UPDATE 2-Fifth Street Asset Management files for IPO

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Sept 8 (Reuters) - Alternative asset manager Fifth Street Asset Management Inc filed with U.S. regulators for an initial public offering of its Class A common stock.

Morgan Stanley, J.P. Morgan and Goldman Sachs were among the major underwriters for the IPO, the Greenwich, Connecticut-based company told the U.S Securities and Exchange Commission in a preliminary prospectus on Monday. (1.usa.gov/1qGTXgQ)

Fifth Street Asset Management, which managed more than $5.6 billion of assets as of June 30, intends to list its common stock on the Nasdaq under the symbol “FSAM”. The filing did not say how many shares it planned to sell or their expected price.

About 95 percent of Fifth Street Asset Management’s managed assets are in publicly traded business development companies (BDCs) Fifth Street Finance Corp and Fifth Street Senior Floating Rate Corp.

They accounted for about 99 percent of the company’s revenue for the year ended December.

BDCs are closed-end funds that invest in small and medium-sized companies and financially troubled businesses. They must pass on at least 90 percent of their profit to shareholders.

Fifth Street Asset Management’s adjusted net income grew 42.7 percent to $30.2 million for the six months ended June 30 from the same period, a year earlier. Revenues jumped 44.4 percent to $47.1 million.

The filing included a nominal fundraising target of about $200 million.

The company will use the proceeds to buy limited partnership interests of Fifth Street Holdings LP, the holding company.

Substantially all of the proceeds will flow to its executive officers, including principals - Chief Executive Leonard Tannenbaum and Chief Compliance Officer Bernard Berman, the filing said.

Fifth Street Asset Management will not have any of the proceeds.

Shares of Ares Management LP, which went public in May, trade about 5 percent below their IPO price of $19. Ares Management runs Ares Capital Corp and was the first U.S. private equity firm to go public in about two years.

The amount of money a company says it plans to raise in its first IPO filings is used to calculate registration fees. The final size of the IPO could be different. (Reporting by Avik Das in Bangalore; Editing by Sriraj Kalluvila and Joyjeet Das)

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