Key Takeaways
- • Ares Management is actively evaluating acquisitions of major private equity firms to strengthen its leveraged buyout (LBO) operations and compete more effectively in the buyout market, according to CEO Michael Arougheti.
- • The strategic move reflects Ares' shift from its core private credit business to expand capabilities across the broader alternative asset management spectrum, positioning the firm to capitalize on renewed deal activity in the LBO market.
- • CEO Arougheti has identified a "reawakening" in the private equity market driven by declining interest rates and increased M&A activity, creating a window for Ares to deploy capital at scale through expanded buyout operations.
- • The acquisition strategy is underpinned by strong capital raising momentum, with Ares simultaneously targeting real estate fund closes in early 2026 and reporting 78% year-on-year growth in deployment activity, demonstrating robust investor appetite for the firm's products.
- • This initiative signals Ares' intent to compete with established mega-fund private equity platforms by building or acquiring in-house LBO capabilities rather than relying solely on partnerships with external PE sponsors.
Summary
Ares Management, the $290+ billion alternative asset manager and private credit powerhouse, is actively pursuing acquisitions of major private equity platforms to bolster its leveraged buyout operations and enhance competitive positioning in the broader PE market. According to CEO Michael Arougheti, the firm is open to significant deals that would allow Ares to build out proprietary LBO capabilities and reduce reliance on external private equity sponsors for deal sourcing and execution.
The strategic pivot reflects a broader shift in Ares' business model beyond its foundational private credit franchise. Arougheti characterized the current market environment as a "reawakening" of the private equity sector, driven by declining interest rates, increased M&A activity, and renewed capital deployment momentum. This market tailwind, combined with Ares' substantial dry powder and access to capital, creates a strategic opening for the firm to pursue transformational acquisitions that would position it as a more comprehensive alternative asset manager capable of competing directly with established mega-fund PE operators.
The timing of this acquisition interest aligns with robust capital raising results across Ares' platform. Real estate funds are on pace to close in early 2026, while the firm reported 78% year-on-year growth in capital deployment activity, signaling strong investor demand and available liquidity for new investments. This capital raising momentum provides Ares with the financial flexibility to pursue larger transactions while simultaneously funding ongoing operations and returning capital to existing investors.
The move also reflects structural shifts in the institutional investor base, with retirement plans and family offices increasingly allocating to private markets solutions. By expanding its PE capabilities in-house, Ares can better serve these investors with integrated solutions spanning credit and equity strategies, potentially commanding higher fees and strengthening client retention across its product suite. This acquisition strategy represents a deliberate effort to evolve from a specialized credit manager into a diversified alternative asset manager capable of competing across multiple segments of the alternative investment landscape.
The strategic pivot reflects a broader shift in Ares' business model beyond its foundational private credit franchise. Arougheti characterized the current market environment as a "reawakening" of the private equity sector, driven by declining interest rates, increased M&A activity, and renewed capital deployment momentum. This market tailwind, combined with Ares' substantial dry powder and access to capital, creates a strategic opening for the firm to pursue transformational acquisitions that would position it as a more comprehensive alternative asset manager capable of competing directly with established mega-fund PE operators.
The timing of this acquisition interest aligns with robust capital raising results across Ares' platform. Real estate funds are on pace to close in early 2026, while the firm reported 78% year-on-year growth in capital deployment activity, signaling strong investor demand and available liquidity for new investments. This capital raising momentum provides Ares with the financial flexibility to pursue larger transactions while simultaneously funding ongoing operations and returning capital to existing investors.
The move also reflects structural shifts in the institutional investor base, with retirement plans and family offices increasingly allocating to private markets solutions. By expanding its PE capabilities in-house, Ares can better serve these investors with integrated solutions spanning credit and equity strategies, potentially commanding higher fees and strengthening client retention across its product suite. This acquisition strategy represents a deliberate effort to evolve from a specialized credit manager into a diversified alternative asset manager capable of competing across multiple segments of the alternative investment landscape.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.