Oct 28 (Reuters) - Asset management firm T Rowe Price on Thursday agreed to buy fund manager Oak Hill Advisors in a $4.2 billion deal as it looks to expand its footprint in the alternative investments market.
The cash-and-stock deal could trigger more M&A activity in the asset management space, with potential tie-ups between other mutual fund managers and private equity firms.
As of July-end, New York-based OHA manages $53 billion of capital across its asset classes. Since January last year, it has raised $19.4 billion of capital.
The deal will be financed through 74% of cash and the rest in T Rowe's common stock. The company will pay an additional $900 million if certain business milestones are achieved in the beginning of 2025, it said.
Evercore was the financial adviser to T Rowe Price, while J.P. Morgan Securities and M. Klein & Company advised OHA.
Reporting by Niket Nishant in Bengaluru; Editing by Shailesh Kuber