Great Elm Group Sells a Majority Interest in Forest Investments, Inc. to an Affiliate of JPMorgan Chase & Co.
Rhea-AI Summary
Great Elm Group (NASDAQ: GEG) has sold 61% of its ownership interest in Forest Investments, Inc. to J.P. Morgan for approximately $18 million. This transaction is expected to raise about $45 million in total cash proceeds for Great Elm, enhancing its investment management capabilities. Post-transaction, J.P. Morgan holds 81% of Forest, while Great Elm retains a 19% stake with the option to sell for $27 million. This strategic move aligns with Great Elm's focus on its core investment management strategy.
Positive
- Sale of 61% interest in Forest Investments raises $18 million in cash.
- Total potential cash proceeds could reach $45 million.
- Strengthens focus on investment management and growth potential.
Negative
- None.
News Market Reaction – GEG
In the trading session that priced this news, GEG gained 4.46%, reflecting a moderate positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
AI-generated analysis. How Rhea-AI works. Not financial advice.
The sale of a majority of its ownership interest in Forest Investments, Inc. is expected to ultimately raise approximately
WALTHAM, Mass., Jan. 03, 2023 (GLOBE NEWSWIRE) -- Great Elm Group, Inc. (“we,” “us,” “our,” “GEG” or “Great Elm,”) (NASDAQ: GEG), an investment management company, today announced its sale of a majority of its ownership interest in Forest Investments, Inc. (“Forest”) to J.P. Morgan Broker-Dealer Holdings Inc. (“JPM”).
Transaction Highlights
- GEG has sold
61% of its direct and indirect common equity of Forest to JPM for approximately$18 million in cash. - Together with its purchase of
20% of the common equity of Forest in December 2020, JPM owns81% of Forest as of December 30, 2022. - GEG has the right to put its remaining
19% ownership interest in Forest for cash proceeds of approximately$27 million .
Management Commentary
Jason Reese, Executive Chairman of GEG, said, “The Forest transaction represents a successful outcome for Great Elm’s shareholders. This marks the latest in a series of strategic actions taken to enhance our focus and capabilities across our core investment management strategy. We are pleased to have worked with JPM as a financial partner in Forest. This transaction underscores the ability for Great Elm to raise capital as it looks to grow its investment management business.”
Transaction Terms
GEG has sold
About Great Elm Group, Inc.
Great Elm Group, Inc. (NASDAQ: GEG) is a publicly-traded, investment management company focused on growing a scalable and diversified portfolio of long-duration, permanent capital vehicles across corporate credit, specialty finance, real estate and other asset classes. GEG and its subsidiaries currently manage Great Elm Capital Corp., a publicly-traded business development company, and Monomoy Properties REIT, LLC, an industrial-focused real estate investment trust, in addition to other investments. GEG’s website can be found at www.greatelmgroup.com.
Media & Investor Contact:
geginvestorrelations@greatelmcap.com
