A few weeks ago, I reviewed Vinci Compass partners, an asset manager focused in Latin America. This time, I will review another Latin American asset manager.
It makes sense to continue in the same industry and geography so I can better compare the two.
A reminder about Asset management:
Asset management is one of the highest quality businesses you can find. You get to collect fees on capital that grows when the investments grow in value, and the capital base can also grow if there is organic growth.
This does not consume the company’s own capital, which can be used for M&A, dividends or buybacks.
A good example of this is Brookfield asset management.
History
Patria investments was started as Patrimônio Participações in 1988 with Solomon Brothers in Brazil. It was as a Brazilian M&A and financial advisory firm.
In 1994, it started the private equity operations as a proprietary investment of the Brazilian shareholders of Banco Patrimonio and raised its first fund independently with LPs in 1997.
Like for Vinci, the local managers bought a majority stake from a foreign company (Solomon Brothers), and sold the banking business.
In 2001 it rebranded as Patria Investments.
A 2010 partnership with Blackstone helped grow AUM. Blackstone bought 40% of Patria.
In 2021, the company IPO’d on the NASDAQ as a SPAC and started an acquisition based strategy.
Later in September 2021, it did a business combination with Moneda, an asset manager from Chile, that grew Patria’s AUM substantially from 16 to 26 Billion USD. The acquisition was 60% funded by stock equity issuance and 40% by cash.
In 2022, Blackstone exited.
In Oct 2023: Private Equity Solutions Business from abrdn was acquired. Transaction was for ~$122 million payable to the seller in cash.
In Dec 2023 it acquirer Credit Suisse’s Real Estate Business in Brazil, for total cash consideration of up to R$ 650 million (~US$ 130 million).
In July 2024: Patria Investments Completed the Acquisition of Nexus Capital, Further Expanding its Real Estate Platform in Colombia
In 2025: In Announced the acquisition of seven listed Brazilian REITs with total FEAUM of ~$600 million.
Patria funded some acquisitions with shares, which I do not particularly like. However, it still was able to provide solid per share performance:
In the premium section below I will review the business and compare it with Vinci Compass.
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