The bulk of American Capital will go to Ares Capital in a deal worth a total of nearly $3.2 billion. American Capital stockholders will be given $6.41 per share and just over 0.48 of an Ares Capital share for each share they own. After the transaction closes, current Ares Capital shareholders will own around 74% of the merged entity, with present American Capital investors holding the remainder.
Additionally, Ares Capital's external manager, Ares Management, is to pay $1.20 per share to American Capital shareholders at closing. All told, that contribution will total approximately $275 million. The bulked-up Ares Capital will retain Ares Management as its external manager.
The remainder of American Capital, specifically its business unit, American Capital Mortgage Management, is to be sold to American Capital Agency. That business currently functions as the external manager of American Capital Agency, so the deal will essentially bring that management in-house. American Capital Agency will pay $562 million, or $2.45 per American Capital share, for the unit.
American Capital shareholders will receive a total of $17.40 in cash and Ares Capital stock in the deal. That's around 11% higher than the company's closing stock price at the end of last week, and totals over $4 billion.
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