Ariel Investments Introduces First Private Investment Initiative, Ariel Alternatives
February 18, 2020
CHICAGO--(BUSINESS WIRE)--Ariel Investments, LLC (“Ariel”) today announced the launch of Ariel Alternatives, LLC (“Ariel Alternatives” or the “firm”), a private asset management firm. This announcement marks Ariel Investments’ first foray into the private investment sphere in its 38-year history.
Ariel Alternatives’ initial strategic initiative (“Project Black” or “the initiative”) will have a mission to scale sustainable minority-owned businesses. Through this effort, Ariel Alternatives intends to invest in middle-market companies that are not currently minority owned, transforming these entities into certified minority business enterprises, as well as existing Black and Latinx-owned businesses. Project Black will forge a new class of Black and Latinx entrepreneurs. The initiative will seek to position these companies as leading suppliers to Fortune 500 companies – supporting supply chain diversity. Project Black aims to close the racial wealth gap by generating jobs, economic growth and equality within underrepresented populations from the entry level to the boardroom.
JPMorgan Chase & Co. (“JPMorgan”) has committed up to $200 million to be co-invested alongside Project Black for future transactions. This commitment is part of JPMorgan’s previously announced plan to invest $30 billion to advance racial equity. Over the next five years, JPMorgan will seek to provide economic opportunity to Black and Latinx communities by: promoting and expanding affordable housing and homeownership; growing Black and Latinx-owned businesses; improving financial health and access to banking; and investing in a more diverse and inclusive workforce.
The Co-Founders of Ariel Alternatives are Leslie A. Brun and Mellody Hobson. Brun will serve as Chairman and CEO of Ariel Alternatives and will lead the Project Black team. Brun is an executive with over 40 years of expertise in investment banking, commercial banking and financial advisory services. He is the founder and former Chairman and CEO of Hamilton Lane, one of the largest global investment managers providing private markets solutions with over $500 billion in assets under management and supervision. Brun is also Chairman of the board of directors of CDK Global, lead independent director of Merck & Co., Inc. and Broadridge Financial Solutions, Inc., and a director of Corning, Inc. and Ariel Investments, LLC. Hobson continues in her current role as Co-CEO, President and director of Ariel Investments, LLC and Chairman of the Board of Trustees of the Ariel Investment Trust. She is also Vice Chair and incoming Chair of the Board of Starbucks Corporation, and a director of JPMorgan Chase.
Leslie A. Brun commented: “It is no secret that the racial wealth gap in America continues to widen, day by day. While we have been encouraged and inspired by the supply chain diversity commitments recently made by large corporations, we believe that it is time to accelerate these promises with real, measurable steps. Our work will aim to bring operational excellence, financial resources, minority ownership and leadership to these companies.”
Ariel Alternatives’ advisory affiliate, Project Black Management Company, LLC, plans to invest in existing standalone companies and corporate divisions in the middle-market that are not currently minority owned, as well as existing Black and Latinx-owned businesses, with $100 million to $1 billion in revenue. Initially, the initiative will pursue 6-10 deal opportunities. Through a rigorous review and direct engagement, Project Black’s investment team researched the needs of Fortune 500 companies across industries. Project Black plans to focus predominately on healthcare, industrial, media and marketing, outsourcing, manufacturing and packaging, technology, transportation and logistics, and financial and professional services. The strategy will continue to be informed by direct engagement with Ariel Alternatives’ network of Fortune 500 companies that are committed to diversifying their vendors. The Project Black investment team believes that through ownership and ongoing counsel, future companies would become scalable platforms with long-term growth potential.
Mellody Hobson continued: “Through Project Black, we plan to ultimately disperse opportunity throughout underrepresented communities. We want to change the narrative and foster true action and demonstrable change. Ariel’s 38-year heritage was built on a patient yet urgent approach to public market investing. The same core values will be brought to Ariel Alternatives in the private investment arena.”
Ariel Alternatives’ investment team will be led by the Co-Founders of Project Black, Frantz Alphonse and Richard Powell, who will also serve as Senior Managing Directors of Ariel Alternatives. Previously, Alphonse and Powell were Co-Founders and Senior Managing Directors of APC Holdings LLC (“APCH”), a private investment and corporate development firm. Alphonse and Powell will partner with Ariel Alternatives and Project Black Senior Managing Director Charles Corpening. Previously, Corpening served as Chairman of Joshua Partners, a private equity firm, and he was a longtime co-investor and Senior Advisor to APCH. These three senior team members have worked in similar markets over decades and bring deep relationships with Fortune 500 C-Suite executives, board members and purchasing officers. This investment team has gleaned insights through extensive research that will inform the firm’s targeted investment approach.
Ariel Alternatives will also leverage strategic counsel from its advisory board on an ongoing basis. This group has served on the boards of several Fortune 500 companies, and advised on several M&A transactions:
Paget L. Alves: Former Chief Sales Officer and President of Business Markets Group, Sprint Corp; Board member of Assurant, Inc., International Game Technology PLC, Synchrony Financial, Yum! Brands, Inc. and Ariel Investments, LLC
James Bell: Former CFO, Boeing Co.; Board member of Apple Inc., CDW Corp. and Dow Inc.
William M. Lewis, Jr.: Managing Director and Chairman of Investment Banking, Lazard Ltd; Board member of Ariel Investment Trust
Robbie Robinson: Co-Founder and CEO, Pendulum Holdings, LLC; former partner at BDT Capital Partners
John W. Rogers, Jr.: Co-CEO, Chief Investment Officer and Director, Ariel Investments, LLC; Board member of The New York Times Company, Nike, Inc., McDonald’s Corporation and Ariel Investment Trust
David J. Vitale: Former Vice Chairman of Bank One Corp.; Board member of United Airlines Holdings, Inc., several Duff & Phelps investment company funds and Ariel Investments, LLC
Ariel Investments was advised by Kirkland & Ellis LLP on the creation of Ariel Alternatives.
About Ariel Alternatives, LLC
Ariel Alternatives, LLC is a private asset management firm affiliated with Ariel Investments, LLC. It is an enterprise newly conceived for the times, built on a 38-year-old foundation. The firm’s initial initiative, Project Black, will have a mission to scale sustainable minority-owned businesses which will serve as leading suppliers to Fortune 500 companies – supporting supply chain diversity. Project Black plans to close the racial wealth gap by aiming to generate jobs and economic growth within underrepresented communities. The initiative plans to invest in businesses that are not currently minority owned, as well as existing minority-owned businesses, forging a new class of Black and brown entrepreneurs. Over the next decade, Project Black hopes to create 100,000 new jobs in disproportionately underrepresented minority communities across 6-10 companies. With scale, Black and brown wealth would grow from the entry level to the boardroom. For more information, please visit Ariel Alternatives’ website at arielalternatives.com.
About Ariel Investments, LLC
Ariel Investments, LLC is a global value-based asset management firm founded in 1983. Ariel is headquartered in Chicago, with offices in New York City, Washington, D.C., and Sydney. As of January 31, 2021, Ariel’s firm-wide assets under management totaled approximately $15 billion. Ariel serves individual and institutional investors through five no-load mutual funds and 11 separate account strategies. For more information, please visit Ariel’s website at arielinvestments.com.
Contacts
Arielle Patrick
Chief Communications Officer
Communications@arielinvestments.com
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