Bloomberg -- Bardin Hill - 1

October 10, 2018 |


TPG Sixth Street Buys Stake in Halcyon,
Dyal Adds to Holding
by Melissa Karsh
October 10, 2018, 9:07 AM EDT
▶ Dillow to become Halcyon CEO as firm is renamed Bardin Hill
▶ Current CEO John Bader retiring as succession plan completed

TPG Sixth Street Partners, the $27 billion credit
firm, is buying a stake in Halcyon Capital Management, an investment manager finalizing its long-term
succession plan.
TSSP, led by managing partner Alan Waxman and
part of TPG, is acquiring a passive equity position
in Halcyon, the companies said Wednesday in a
statement. Neuberger Berman Group's Dyal Capital
Partners is also adding to a minority investment first
made in 2012.
"A lot of other transactions in our space, whether it's
to go public or stay private, they involve some form of
taking chips off the table or cashing out," Jason Dillow,
who's taking over as Halcyon's chief executive officer,
said in a Bloomberg Television interview. "That's
exactly the opposite of what we're doing here -- no
partner is selling in the transaction."
TSSP and Dyal will own between 20 percent and 25
percent of the $10 billion New York-based firm, said a
person with knowledge of the matter who asked not to
be named because the information is private. Concurrent
with the transaction, Halcyon will be renamed Bardin
Hill Investment Partners.
Dillow's appointment completes a succession process
started in 2016, when he was named chief investment
officer, a role he still holds. Current CEO John Bader, 56,
is retiring after almost 30 years at the firm. Dillow, 41,
came to Halcyon in 2005 from Goldman Sachs Group
Inc., where he worked in the special-situations investing
group with Waxman, a co-founder of TSSP in 2009.

Succession Planning

Several investment managers have been planning
for succession, a decision that hasn't always come easily
after decades in the business. At Och-Ziff Capital Management Group LLC, former banker Robert Shafir was
chosen early this year to succeed Dan Och over co-CIO

Jason Dillow, CEO of Bardin Hill Investment Partners, discusses the evolution of the firm.

Jimmy Levin. Ray Dalio started plotting his transition at
Bridgewater Associates eight years ago in a process that's
included management shuffling.
The TSSP-Dyal deal will help position Bardin Hill for
the future, Dillow said in an interview. The additional
liquidity offered by such transactions often helps managers looking to invest in new businesses or increase commitments to their funds.
"The reality is our investors have a long-term horizon,
and that's the type of capital we want to raise and how
we want to invest," he said. "We're not under the same

pressures as those folks trying to outperform the S&P in
the short term."
Dillow and some of Halcyon's other managing principals and a philanthropic foundation started by founder
Alan Slifka are also purchasing equity in the firm, according to the statement. All the equity being sold is newly
issued. Terms weren't disclosed.
Halcyon, which was founded in 1981 and focuses on
credit and event-driven investments, has about $7 billion
in collateralized-loan obligations and $3 billion in hedge
fund and multistrategy assets.

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