8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 9, 2021

BrightSphere Investment Group Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-38979	47-1121020
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification Number)

200 Clarendon Street, 53rd Floor

Boston, Massachusetts 02116

(617) 369-7300

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.001 per share	BSIG	New York Stock Exchange
4.800% Notes due 2026	BSIG 26	New York Stock Exchange
5.125% Notes due 2031	BSA	New York Stock Exchange

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐               Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐               Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐                 Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐                 Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2).

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

ITEM 1.01    Entry into a Material Definitive Agreement.

On May 9, 2021, BrightSphere Investment Group Inc. (“BrightSphere”), through its subsidiary BrightSphere Inc., a Delaware corporation (“BSI”), entered into an Equity Purchase Agreement (the “TS&W Purchase Agreement”) with TS&W Investment Holdings LP, a Delaware limited partnership (the “TS&W LP”), Thompson, Siegel & Walmsley LLC, a Delaware limited liability company (“TS&W LLC”), WS&T Investment Holdings GP LLC, a Delaware limited liability company, Pendal USA Inc., a Delaware corporation (the “Buyer”), and (solely for purposes of Sections 2.3.2(c), Article 7, and Section 11.17 of the TS&W Purchase Agreement) Pendal Group Limited, an Australian public company incorporated under the Corporations Act. Pursuant to the TS&W Purchase Agreement, the Buyer agreed to purchase (i) the seventy-five and one-tenth percent (75.1%) interest in TS&W LLC owned by BSI in exchange for $240,000,000 of cash and (ii) the twenty-four and nine-tenths percent (24.9%) interest in TS&W LLC owned by TS&W LP in exchange for $79,680,000 comprised of a combination of cash, equity interests of an affiliate of the Buyer and investments in TS&W LLC investment products, representing a total enterprise value of $319,680,000. The transaction is subject to certain customary closing and post-closing adjustments to purchase price, including for debt, working capital, transaction expenses, and changes to the revenue run-rate for clients of TS&W LLC prior to closing. The TS&W Purchase Agreement contains customary representations, warranties and covenants of BSI, TS&W LP, and TS&W LLC, including, among others, covenants to conduct the business of TS&W LLC in the ordinary course during the period between the execution of the TS&W Purchase Agreement and the closing of the transaction. The TS&W Purchase Agreement does not contain any indemnification provisions and the Buyer has obtained, at BSI’s expense, a representations and warranty insurance policy. The closing of the transaction is subject to various closing conditions, including, among others, (i) the receipt of approval, or the expiration or termination of the waiting period, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, (ii) the absence of any preliminary or permanent injunction or other order preventing the closing of the transaction, (iii) the absence of a material adverse effect between the signing date and the closing of the transaction, (iv) the accuracy of the fundamental representations and warranties in all but de minimis respects and the accuracy of the general representations and warranties except as would not result in a material adverse effect and (v) the revenue run-rate for all investment advisory clients of TS&W LLC at closing being equal to or greater than 80% of the revenue run-rate for such clients as of April 30, 2021.

ITEM 7.01                                       Regulation FD Disclosure

On May 9, 2021, BrightSphere issued a press release regarding the divestiture of the Company. A copy of the press release is attached as Exhibit 99.1 hereto.

ITEM 9.01                                       Financial Statements and Exhibits.

(d) Exhibits.

The information in Item 7.01 to this Form 8-K and the information filed as Exhibit 99.1 to this Form 8-K is being furnished and shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. Such information shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, except as may be expressly set forth in a specific filing.

Exhibit No.	Description
99.1	Press Release of the Company
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this form to be signed on its behalf by the undersigned, thereto duly authorized.

Date:	May 10, 2021	BRIGHTSPHERE INVESTMENT GROUP INC.
		By:	/s/ Richard J. Hart
		Name:	Richard J. Hart
		Title:	Chief Legal Officer and Secretary

EX-99.1

Contact:

Elie Sugarman

ir@bsig.com

(617) 369-7300

BrightSphere Investment Group Inc. Announces Agreement to sell Affiliate, Thompson, Siegel and Walmsley LLC

– BrightSphere and the management team of Thompson, Siegel and Walmsley LLC (“TSW”) have entered into an agreement to sell 100% of the equity interests in TSW to Pendal Group Limited (ASX: PDL)

–BrightSphere to receive $254 million in cash for its 75.1% ownership interest in TSW and its seed capital investments in TSW’s strategies

–Total expected after-tax proceeds to BrightSphere of approximately $196 million

BOSTON, MA – BrightSphere Investment Group Inc. (NYSE: BSIG) today announced that it has entered into a definitive agreement to sell its 75.1% ownership interest in Thompson, Siegel Walmsley LLC (“TSW”) to Pendal Group Limited (”Pendal") for $240 million. As part of the transaction, Pendal will additionally acquire the 24.9% ownership interest in TSW held by the TSW management team, resulting in Pendal acquiring 100% of TSW for total consideration of approximately $320 million.

In addition to acquiring BrightSphere’s equity interest in TSW, Pendal has also agreed to acquire BrightSphere’s seed capital in TSW strategies, which had a book value of approximately $14 million as of April 30, 2021. BrightSphere anticipates total after-tax proceeds from the transaction of approximately $196 million, including proceeds from the return of its seed capital.

The transaction is subject to customary regulatory approvals and closing conditions and is anticipated to close in the third quarter of 2021.

Suren Rana, BrightSphere’s President and Chief Executive Officer said, “This transaction unlocks significant value for BrightSphere’s shareholders given the valuation received in the transaction relative to our stock’s current trading levels. We expect to use the proceeds from this divestiture primarily to pay down debt and return capital to our shareholders. Our remaining business now predominately comprises Acadian, a highly diversified and differentiated manager providing best-in-class quantitative strategies and solutions to its clients.”

“We are pleased that TSW will be joining a highly reputed, global organization that is committed to supporting TSW in their continued growth. We are thankful to the TSW team for their important contributions to BrightSphere and wish them the best in their future initiatives.” Mr. Rana added.

Founded in 1969, TSW applies a value-oriented investment approach across a range of products in U.S. and international equities, fixed income and alternative investments. TSW’s singular objective is to outperform its benchmarks, net of fees, over rolling three- to five- year periods. As of March 31, 2021, TSW had $24.9 billion in assets under management, and for the year ended December 31, 2020, contributed GAAP net income attributable to controlling shareholders and Adjusted EBITDA to BrightSphere of $22.1 million and $25.2 million, respectively.1

Morgan Stanley & Co. LLC acted as financial advisor to BrightSphere on the transaction, while Ropes & Gray LLP served as legal advisor to BrightSphere.

About BrightSphere

BrightSphere is a diversified, global asset management company with approximately $141 billion2 of assets under management as of March 31, 2021. Through its world-class investment management Affiliates, BrightSphere offers sophisticated investors access to a wide array of leading quantitative and solutions-based, and alternative strategies designed to meet a range of risk and return objectives. For more information, please visit BrightSphere’s website at www.bsig.com. Information that may be important to investors will be routinely posted on our website.

Forward Looking Statements

This press release includes forward-looking statements, including those related to the after-tax proceeds from our disposition of TSW and the expected closing date of the transaction. The words or phrases “expect,” “anticipate,” “estimate,” and other similar expressions are intended to identify such forward-looking statements, but the absence of these words does not necessarily mean that a statement is not forward-looking. Such statements are subject to various known and unknown risks and uncertainties and readers should be cautioned that any forward-looking information provided by or on behalf of the Company is not a guarantee of future performance.

Actual results may differ materially from those in forward-looking information as a result of various factors, some of which are beyond the Company’s control, including, but not limited to, those discussed in the Company’s most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 1, 2021, and subsequent SEC filings, including risks related to the disruption caused by the COVID-19 pandemic, which has and is expected to continue to materially affect our business, financial condition, results of operations and cash flows for an extended period of time, as well as those related to the expected closing of the transaction and the satisfaction of necessary closing conditions. Due to such risks and uncertainties and other factors, the Company cautions each person receiving such forward-looking information not to place undue reliance on such statements. Further, such forward-

__________________________

1 See “Non-GAAP Measures” and “Reconciliation of TSW GAAP net income attributable to controlling interests to Adjusted EBITDA” at the end of this release for more information.

2 In the first quarter of 2021, BrightSphere announced the divestiture of Investment Counselors of Maryland and Landmark Partners, which are each expected to close in the second quarter of 2021. These figures give effect to these divestitures.

looking statements speak only as of the date of this press release and the Company undertakes no obligations to update any forward looking statement to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.

Non-GAAP Financial Measures

This release contains references to Adjusted EBITDA, which is a non-GAAP financial measure. A reconciliation of Adjusted EBITDA to GAAP net income attributable to controlling interests is included below. The Company notes that its calculation of Adjusted EBITDA may not be consistent with Adjusted EBITDA as calculated by other companies.

Reconciliation of TSW GAAP net income attributable to controlling interests to Adjusted EBITDA for the year ended December 31, 2020

$ in millions
U.S. GAAP net income attributable to controlling interests	$	22.1
Non-cash key employee-owned equity and profit interest revaluations	(5.1)
Depreciation and amortization	0.4
Income tax expense	7.8
Adjusted EBITDA	$	25.2

XML

Cover Page	May 09, 2021
Entity Information [Line Items]
Document Type	8-K
Document Period End Date	May 09, 2021
Entity Registrant Name	BrightSphere Investment Group Inc.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-38979
Entity Tax Identification Number	47-1121020
Entity Address, Address Line One	200 Clarendon Street
Entity Address, Address Line Two	53rd Floor
Entity Address, City or Town	Boston
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02116
City Area Code	617
Local Phone Number	369-7300
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Entity Central Index Key	0001748824
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Common stock, par value $0.001 per share
Entity Information [Line Items]
Title of 12(b) Security	Common stock, par value $0.001 per share
Trading Symbol	BSIG
Security Exchange Name	NYSE
4.800% Notes due 2026
Entity Information [Line Items]
Title of 12(b) Security	4.800% Notes due 2026
Trading Symbol	BSIG 26
Security Exchange Name	NYSE
5.125% Notes due 2031
Entity Information [Line Items]
Title of 12(b) Security	5.125% Notes due 2031
Trading Symbol	BSA
Security Exchange Name	NYSE