NEW YORK (The Deal) -- Ares Management (ARES) said important lines of its businesses will benefit from the departure of General Electric (GE) from its financial businesses, but Ares' management didn't address specifically whether it would be a bidder for any of the assets on the block.
Speaking with analysts on the quarterly conference call following the release of its first-quarter earnings, Ares management said, "GE exiting the business is a very, very good thing for Ares," especially in operations such as tradable lending.
Because of the sheer magnitude of its balance sheet, GE often had the lowest cost of capital in auctions for certain credit opportunities, so it could be the low-cost lender in many situations. With the company's departure from the capital complex, "We should see fees go up and margins widen," Ares management said on the call.
Ares management was not asked -- nor did it volunteer -- whether it was preparing a bid for parts of GE's business, especially the GE Antares unit, for which preliminary bids were reportedly scheduled to be handed in last week. Antares is basically a provider of capital for private equity lending, and while Ares has been one of the alternative asset firms mentioned as a potential buyer, PE firms in general are seen as being at a disadvantage to any of the banks that might bid on the assets. Wells Fargo & Co. (WFC) and Sun Trust (STI) have been identified in several news accounts as potential suitors for Antares.