Assured Guaranty in strategic deal with investment manager

Bermuda-based holding company Assured Guaranty has completed a strategic partnership with Sound Point Capital Management, an investment manager overseeing approximately $32 billion in total assets.

Sound Point has entered into an agreement to acquire Assured Investment Management and certain of its related asset management entities, which conducts the institutional asset management business of Assured Guaranty.

As part of what it calls a strategic partnership, Assured Guaranty will become a significant equity holder of Sound Point and certain of Assured Guaranty’s US insurance subsidiaries will commit to invest $1 billion over time in Sound Point managed vehicles and separately managed accounts. Sound Point will become the sole alternative credit manager for the Assured Guaranty US insurance subsidiaries.

Sound Point will assume the management of 32 active Assured IM CLOs, comprising 25 US CLOs and seven European CLOs, making Sound Point the fifth largest broadly syndicated loan CLO manager globally on a pro forma basis. New York-based Sound Point is currently managing 39 CLOs of its own and also manages over $10 billion of assets in other areas of credit investing, including direct loans, capital solutions, distressed, structured products, commercial real estate lending, and specialty finance.

“This is a watershed event in Sound Point’s growth story, and it positions us for continued success in a business where scale has become increasingly important,” said Stephen Ketchum, Sound Point’s founder and managing partner. “It’s our largest transaction to date, and we’re extremely proud to be receiving a one-billion-dollar investment commitment over time from Assured Guaranty. We’re thrilled to be expanding our diversified platform through a powerful new partnership that will create immediate impact.”

The transaction is expected to be completed in the beginning of Q3 2023. As part of the acquisition, a significant number of employees from Assured-IM are expected to join Sound Point, both in New York and London.

“This acquisition further strengthens our platform and will allow Sound Point to leverage its already comprehensive firmwide infrastructure and investment teams,” said David Grill, head of strategy at Sound Point. “Assured Guaranty’s investment commitment will be allocated to Sound Point managed CLOs as well as a range of other credit strategies.”

Assured-IM was formerly known as BlueMountain Capital Management. BlueMountain was acquired by Assured Guaranty on October 1, 2019, and subsequently rebranded as Assured Investment Management.