BUSINESS COMBINATIONS

12 Months Ended

Dec. 31, 2017

Business Combinations [Abstract]

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS

Acquisition of EIF Management, LLC

In January 2015, the Company acquired of all of the outstanding membership interests of EIF Management, LLC (“EIF”), an asset manager in the U.S. power and energy assets industry. As a result of the acquisition, the Company expanded into an energy infrastructure equity strategy focused on generating long-term, cash-flowing investments in the power generation, transmission and midstream energy sector.

The acquisition date fair value of the consideration transferred totaled $149.2 million, which consisted of the following:

Cash	$	64,532
Equity (1,578,947 Ares Operating Group units)	25,468
Contingent consideration	59,171
Total	$	149,171

The Company allocated $90.6 million of the purchase price to the fair value of the acquired net assets. The remaining $58.6 million of the purchase price was recorded as goodwill. The financial results of EIF are included within the consolidated financial statements presented herein. EIF is presented within the Company’s Private Equity Group segment.

The transaction included contingent consideration that is payable to EIF’s former membership interest holders if Ares successfully launches a new fund (“Fund V”) that meets certain revenue and fee paying commitment targets during Fund V’s commitment period. The fair value of the liability for contingent consideration as of the acquisition date was approximately $59.2 million, which includes cash and equity consideration that are not subject to vesting or are fully vested, and is included in the purchase price consideration described above (see Note 11 for subsequent valuation adjustments). Additionally, in accordance with the membership interest purchase agreement, as part of the contingent consideration, the Company also agreed to grant certain equity consideration that would generally vest ratably over a period of two to five years after Fund V’s final closing.

Supplemental information on an unaudited pro forma basis, as if the EIF acquisition had been consummated as of January 1, 2015 is as follows:

	Year Ended
	December 31, 2015
Total revenues	$	56,659
Net income attributable to Ares Management, L.P.	$	2,267
Earnings per common unit, basic and diluted	$	0.03

The unaudited pro forma supplemental information is based on estimates and assumptions, which the Company believes are reasonable. These results are not necessarily indicative of the Company’s consolidated financial condition or statements of operations in future periods or the results that actually would have been realized had the Company and EIF been a combined entity during the period presented. These amounts have been calculated after applying the Company’s accounting policies and adjusting the results of EIF to reflect the additional amortization that would have been charged assuming the fair value adjustments to intangible assets had been applied on January 1, 2014, together with the consequential tax effects.

Transaction Support Expense

On January 3, 2017, ARCC and American Capital, Ltd. (“ACAS”) consummated a merger transaction valued at approximately $4.2 billion (the "ARCC-ACAS Transaction"). To support the ARCC-ACAS Transaction, the Company, through its subsidiary Ares Capital Management LLC, which serves as the investment adviser to ARCC, paid $275.2 million to ACAS shareholders in accordance with the terms and conditions set forth in the merger agreement.