(By Balachander) Carlyle Group (NASDAQ:CG) announced it has acquired a 55 percent stake in New York-based commodities investment manager Vermillion Asset Management.
The global alternative asset manager acquired the stake in exchange for cash, an ownership interest in Carlyle and performance-based contingent payments payable over five and a quarter years.
If Vermillion achieves certain performance targets, Carlyle has agreed to issue to the Vermillion principals up to 1,439,788 Carlyle Holdings partnership units over a four and a quarter-year period.
Other terms of the deal were not disclosed.
Carlyle said Vermillion employs a liquid, relative-value, low volatility approach to trading both physical commodities and their derivatives to produce positive, uncorrelated returns.
Vermillion, which has roughly $2.2 billion of assets under management as of Sept. 30, manages three commodities-focused strategies, including relative value, enhanced index and long-biased physical commodities.
Carlyle said Vermillion has become affiliated with Carlyle's Global Market Strategies business with $29 billion in assets. The Global Market Strategies business comprises an array of long/short credit hedge funds, emerging markets equities and macroeconomic strategy hedge funds, structured credit, middle-market credit, energy mezzanine and distressed products.
As of June 30, 2012, Carlyle has $156 billion of assets under management across 99 funds and 63 fund of fund vehicles.
CG shares ended at $25.64 on Tuesday.