F.A.B to Acquire CIFC (CIFC) in $333M Cash Deal

August 22, 2016 6:16 AM EDT

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CIFC LLC (Nasdaq: CIFC) announced that CIFC and an affiliate of F.A.B. have entered into a definitive merger agreement under which F.A.B. will acquire CIFC for approximately $333 million in cash.

Under the terms of the merger agreement, CIFC shareholders will be entitled to receive $11.46 in cash per share – $11.36 per share as consideration in the merger, plus a $0.10 per share distribution detailed below – representing a premium of more than 60% over CIFC's closing share price on August 19, 2016, and a premium of approximately 160% over the January 27, 2016 closing share price, the day prior to CIFC's announcement of its pursuit of strategic alternatives to accelerate the growth of its business. The CIFC Board has declared a cash distribution of $0.10 per share to be paid on September 12, 2016 to shareholders of record as of the close of business on August 31, 2016.

Founded in 2005 and based in New York, CIFC is a $14 billion private debt manager specializing in U.S. corporate loan strategies. CIFC has over 75 employees, including more than 30 dedicated investment professionals. The firm serves more than 200 institutional investors globally and is one of the largest managers of collateralized loan obligations ("CLOs") in North America.

F.A.B. is a global alternative investment platform that focuses on originating, structuring and actively managing investments across geographies and asset classes. F.A.B. was founded by Michele Faissola, Dalinc Ariburnu and Nizar Al-Bassam, each of whom has significant capital markets and investment management experience.

Jeffrey S. Serota, Chairman of CIFC's Board, stated: "We are pleased to have reached this agreement with F.A.B., which follows a thorough review of strategic and financial alternatives that generated interest from over a dozen suitors. Our Board concluded that this offer maximizes value for our shareholders and is in the best interests of our investors and clients."

Stephen Vaccaro, Co-President and Chief Investment Officer of CIFC, added, "We have spent the past 10 years building a robust and scalable U.S. private debt business. With the support of F.A.B., our company embarks on a new chapter of growth and product line expansion. We are thrilled to be able to tap into the extensive experience F.A.B. can contribute to our platform and regard F.A.B. as ideally positioned to help CIFC serve its clients, broaden its product offerings and achieve new milestones."

"CIFC is a leading private debt investment platform and one of the largest CLO managers in the industry and we are thrilled that this acquisition marks our first foray into the U.S. credit markets," said Michele Faissola, Co-Founding Partner of F.A.B. "CIFC's highly experienced investment team, institutional infrastructure and blue-chip client base, make them an ideal partner for us as we look to access the U.S. market for our clients. Our clients are committed to capitalizing on both current and future investment opportunities in the U.S. and we view CIFC as our beachhead into these exciting opportunities."

Nizar Al-Bassam, Co-Founding Partner of F.A.B., added, "With this acquisition, we are thrilled to be backing a strong management team which we have gotten to know well throughout the strategic process. The depth and breadth of the team Steve and his partner, Oliver Wriedt, have built was a key consideration in our decision to choose the CIFC platform as our first major investment geared at accessing the U.S. market. We are looking forward to working alongside them to lead CIFC through its next phase of growth and development."

F.A.B. has secured the capital backing for the acquisition of CIFC from Supreme Universal Holdings Ltd, a company controlled by Qatar's royal family.

The transaction has been approved by CIFC's Board of Directors. Columbus Nova, CIFC's majority shareholder, has agreed to vote its shares in favor of the transaction. The transaction, which is subject to approval by CIFC's shareholders, the satisfaction of certain regulatory approvals and other customary closing conditions, is expected to close this calendar year.

J.P. Morgan Securities LLC is serving as exclusive financial advisor to CIFC and Dechert LLP and Latham & Watkins LLP are serving as legal counsel. Moelis & Company LLC is acting as exclusive financial advisor to F.A.B., and Weil, Gotshal & Manges LLP and Ernst & Young LLP are serving as legal advisor and accounting & tax advisor, respectively.

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