Forum Partners Investment Management has entered into a strategic partnership with La Française, one of the largest fund managers in Europe with $50 billion of assets, that will see the French group take a 24.9 percent stake in its new partner and commit more than $600 million of capital across its strategies.
Forum, the global private equity firm, and La Française, which is an affiliate of France’s Crédit Mutuel Nord Europe (CMNE), said that subject to regulatory approval, the strategic partnership encompassed a “substantial capital commitment to Forum’s global suite of real estate investment strategies and collaboration on a series of new European investment products, including a joint venture to develop European direct real estate products”.
La Française will acquire its 24.9 percent interest in Forum through an issuance of new shares rather than any of Forum’s existing shareholders selling.
The decision has been made by La Française because it wants to globally diversify its real estate holdings which predominantly consist of $9 billion of real estate holdings in France.
In a statement, Forum said the partnership would “combine Forum’s global real estate private equity, debt and securities capabilities with La Française’s proven leadership in French direct real estate and senior debt”.
It added: “In support of this partnership, CMNE and La Française will allocate over $600 million in capital across each of Forum’s principal investment strategies, beginning with over $200 million to Forum’s European debt platform, including mezzanine and senior debt. La Française will also commit capital to Forum’s global securities business, to its Asian private equity strategy and to potential expansion opportunities in the Americas.
In addition, both Forum and La Française will gain access to the other party’s institutional and retail distribution network globally.
Forum has emphasised to existing limited partners and investors in its funds that the existing shareholders of Forum had not sold any shares and La Française will not be taking seats on the investment committee of any existing funds. However, it will take seats on new products developed between them.
Xavier Lepine, president of La Française, said Forum Partners complimented the company in terms of respective areas of expertise, geographic focus and client bases. He explained Forum “aligned closely” with its objective to expand real estate capabilities internationally.
“Through our strategic partnership with Forum we are confident that we can create a global platform that can successfully take on the exciting opportunities in real estate. We look forward to providing clients a complete and original range of real estate products and anticipate Forum will be a significant contributor to our international development,” he said.
Russell Platt, chief executive of Forum, said the strategic partnership came at an important time in the growth of the company as well as the evolution of the real estate investment management industry.
“Volatile markets and on-going consolidation have presented extraordinary growth opportunities for firms with the foresight and experience to recognize the occasion,” he said. He continued: “This partnership will prove invaluable to Forum as we continue to expand our products and capabilities for our capital partners.”