May 23, 2018 / 11:10 AM / a year ago

Private equity fund buys index maker Alerian as ZZ Capital deal stalls

HONG KONG, May 23 (Reuters) - Aretex Capital Partners, a private equity fund that was launched just this year, has agreed to buy Alerian, the developer of the energy benchmark Alerian MLP Index, Aretex said in a statement late on Tuesday.

Aretex was founded by two employees of ZZ Capital International Ltd, whose current deal to purchase Alerian has stalled since last July.

Alerian’s MLP Index tracks energy companies who have structured themselves as master limited partnerships, publicly traded partnerships whose profits are taxed only when investors receive their distribution.

The deal would be the first investment done by Aretex, an investment fund founded by Sergio D’Angelo and Andrew Feller. D’Angelo is currently the head of Europe for ZZ Capital International while Feller is the head of North America, according to their LinkedIn profiles.

Hong Kong-based ZZ Capital International Ltd agreed last July to buy Alerian, a Dallas-based financial index and data provider, for $582 million in cash and up to $230 million in additional payments if it hit revenue targets from 2018 to 2021.

The firm had been attempting to restructure the deal after missing two deadlines to close the transaction.

China’s clampdown last year on bank lending for overseas investments has required ZZ Capital to seek offshore funding for its existing deal pipeline and to slow new mergers and acquisition proposals, it said in a regulatory filing in February.

A U.S.-based spokesman for Aretex could not be reached outside work hours. ZZ Capital’s shares were suspended before trading began on Wednesday, pending an announcement.

Reporting by Kane Wu; Editing by Christian Schmollinger

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