Related Party Transactions

12 Months Ended

Dec. 31, 2019

Amounts due for investment advisory fee receivables from related parties were comprised of the following at December 31 (in millions):



	2019		2018
Investment advisory fee receivable from unconsolidated Funds⁽²⁾	$	15.2	$	25.3
Total amounts due for investment advisory fee receivables from related parties	$	15.2	$	25.3

Investments in related parties consisted of the following at December 31 (in millions):



	2019		2018
Investments in equity-accounted investees (Note 6)	$	2.0	$	1.9
Total related party investments	$	2.0	$	1.9

Related party transactions included in the Company’s Consolidated Statements of Operations for the years ended December 31 consisted of (in millions):



Revenues:	2019		2018		2017
Management fees from OM plc business units⁽¹⁾	$	—	$	—	$	8.5
Management fees from unconsolidated Funds⁽²⁾	211.8		266.4		274.9
Performance fees from unconsolidated Funds⁽²⁾	1.2		2.2		0.1
Total related party revenues	$	213.0	$	268.6	$	283.5
Expenses:
Rent and administrative costs recharged by OM plc business units⁽³⁾	—		—		0.2
Recharged OM plc operational costs⁽⁴⁾	—		—		0.4
Total related party expenses	$	—	$	—	$	0.6


(1)	OM plc was considered a related party through November 17, 2017, at which point OM plc sold all but a deminimus amount of the Company’s ordinary shares (see Note 1). Therefore, revenue and expenses reported in the table above reflect OM plc as a related party through November 17, 2017. OM plc was not considered a related party thereafter.


(2)	Transactions with unconsolidated Affiliate-sponsored Funds are considered related party items on the basis of the Company’s significant influence over the activities of such entities in its capacity as investment advisor thereto. These transactions are comprised of fees for advisory services and investments in unconsolidated funds.


(3)	The Company conducts a portion of its distribution activities out of the United Kingdom, and had entered into contractual arrangements with a related business units domiciled there to share their premises and leverage certain of their administrative functions.

(4)

OM plc historically provided the Company with various oversight services, including governance, which included compensation for board and executive committees, investor relations, procurement of insurance coverage, human resources, financial reporting, internal audit, treasury, systems, risk and tax services. All of these services were transitioned to the Company in 2017. That portion of the above costs which (i) were directly attributable to the Company, (ii) were charged to the Company by OM plc and (iii) were paid to OM plc by the Company, have been recorded in the Company’s Consolidated Financial Statements and were $0.4 million for the year ended December 31, 2017.

Other related party arrangements

During 2016, the Company and OM plc agreed to amend the Deferred Tax Asset Deed (the “DTA Deed”). Under the terms of the DTA Deed, as amended, the Company agreed to make a payment of the net present value of the future tax benefits due to OM plc valued as of December 31, 2016. This payment, originally valued at $142.6 million, was to be made over three installments, on June 30, 2017, December 31, 2017 and June 30, 2018. The initial payment of $45.5 million was paid to OM plc on June 30, 2017. The reduction of the corporate tax rate and other provisions of the Tax Act resulted in a decrease to the value of the DTA Deed of approximately $51.8 million for the year ended December 31, 2018. In 2018, the Company agreed to terminate the DTA Deed with OM plc. The Company recorded a revaluation gain of $20.0 million in connection with the settlement of the DTA Deed for the year ended December 31, 2018. In the first quarter of 2019, the final cash payment of $32.7 million was made to OM plc to settle the outstanding liability under the DTA Deed.

During 2014, the Company entered into a Seed Capital Management Agreement and a Co-Investment Deed with OM plc and/or OM plc’s subsidiaries. During 2016, the Company and OM plc agreed to amend the Seed Capital Management Agreement. As a result of the amendment, the Company purchased approximately $39.6 million of seed investments from OM plc in September 2016. The Company purchased the remaining seed capital investments covered by the Seed Capital Management Agreement valued at $63.4 million in July 2017, financed in part by borrowings under a non-recourse loan facility (see Note 13) and two promissory notes paid in the first quarter of 2018 in the amount of $4.5 million. Amounts owed to OM plc associated with the Co-investment Deed were $3.7 million at December 31, 2019, net of tax.

The Company uses the equity-method to account for its interests in Affiliates where it exercises significant influence over their operations, but does not hold a controlling interest. During 2019, 2018 and 2017, the Company recorded earnings in respect of these investees of $2.8 million, $2.7 million and $14.5 million, respectively. The Company also exercises significant influence over unconsolidated Funds; however in order to report in a manner consistent with consolidated Funds, it has elected to apply the fair value option for its investments therein. Additional information with respect to equity-accounted investees is disclosed in Note 6.

Certain Affiliates have provided loans to Affiliate employees. At December 31, 2019 the balance of these loans to Affiliate employees was $16.1 million.

As the Company is a member of a group of related businesses, it is possible that the terms of certain related party transactions are not the same as those that would result from transactions with wholly unrelated parties.