Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 30, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Document Period End Date | Sep. 30, 2018 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | OZM | |
Entity Registrant Name | Och-Ziff Capital Management Group LLC | |
Entity Central Index Key | 1,403,256 | |
Entity Filer Category | Accelerated Filer | |
Class A Shares | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 191,620,504 | |
Class B Shares | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 300,339,478 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Assets | ||
Cash and cash equivalents | $ 195,041 | $ 469,513 |
Investments (includes assets measured at fair value of $452,959 and $224,722, including assets sold under agreements to repurchase of $42,526 and $0 as of September 30, 2018, and December 31, 2017, respectively) | 485,210 | 238,974 |
Income and fees receivable | 39,522 | 354,456 |
Due from related parties | 32,344 | 28,202 |
Deferred income tax assets | 367,240 | 375,230 |
Other assets, net | 79,145 | 116,361 |
Assets of consolidated funds: | ||
Investments of consolidated funds, at fair value | 183,894 | 43,366 |
Other assets of consolidated funds | 39,302 | 13,331 |
Total Assets | 1,421,698 | 1,639,433 |
Liabilities | ||
Compensation payable | 66,589 | 208,639 |
Unearned incentive | 67,985 | 143,710 |
Due to related parties | 281,996 | 281,555 |
Debt obligations | 290,127 | 569,379 |
Securities sold under agreements to repurchase | 42,378 | 0 |
Other liabilities | 75,081 | 75,122 |
Liabilities of consolidated funds: | ||
Other liabilities of consolidated funds | 37,134 | 11,340 |
Total Liabilities | 861,290 | 1,289,745 |
Commitments and Contingencies | ||
Redeemable Noncontrolling Interests | 585,206 | 445,617 |
Shareholders’ (Deficit) Equity | ||
Paid-in capital | 3,128,587 | 3,102,074 |
Accumulated deficit | (3,559,259) | (3,555,905) |
Shareholders’ deficit attributable to Class A Shareholders | (430,672) | (453,831) |
Shareholders’ equity attributable to noncontrolling interests | 405,874 | 357,902 |
Total Shareholders’ Deficit | (24,798) | (95,929) |
Total Liabilities, Redeemable Noncontrolling Interests and Shareholders’ Deficit | 1,421,698 | 1,639,433 |
Class A Shares | ||
Shareholders’ (Deficit) Equity | ||
Class A Shares, no par value, 1,000,000,000 shares authorized, 191,607,259 and 189,573,210 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | 0 | 0 |
Class B Shares, no par value, 750,000,000 shares authorized, 300,339,478 and 339,339,478 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | 0 | 0 |
Class B Shares | ||
Shareholders’ (Deficit) Equity | ||
Class A Shares, no par value, 1,000,000,000 shares authorized, 191,607,259 and 189,573,210 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | 0 | 0 |
Class B Shares, no par value, 750,000,000 shares authorized, 300,339,478 and 339,339,478 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | $ 0 | $ 0 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Investments measured at fair value | $ 452,959 | $ 224,722 |
Assets sold under agreements to repurchase at fair value | $ 42,526 | $ 0 |
Class A Shares | ||
Common stock, no par value | ||
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 191,607,259 | 189,573,210 |
Common stock, shares outstanding | 191,607,259 | 189,573,210 |
Class B Shares | ||
Common stock, no par value | ||
Common stock, shares authorized | 750,000,000 | 750,000,000 |
Common stock, shares issued | 300,339,478 | 339,339,478 |
Common stock, shares outstanding | 300,339,478 | 339,339,478 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenues | ||||
Other revenues | $ 3,342 | $ 1,524 | $ 11,751 | $ 4,081 |
Income of consolidated funds | 507 | 2,055 | 1,741 | 3,518 |
Total Revenues | 93,827 | 131,999 | 332,003 | 420,097 |
Expenses | ||||
Compensation and benefits | 74,635 | 74,490 | 218,061 | 214,112 |
Interest expense | 4,820 | 5,611 | 18,923 | 17,043 |
General, administrative and other | 50,289 | 33,136 | 136,648 | 114,229 |
Expenses of consolidated funds | (5) | 8,824 | 103 | 9,368 |
Total Expenses | 129,739 | 122,061 | 373,735 | 354,752 |
Other (Loss) Income | ||||
Net losses on early retirement of debt | 0 | 0 | (14,303) | 0 |
Net (losses) gains on investments in funds and joint ventures | (541) | 264 | (1,014) | 1,050 |
Net gains of consolidated funds | 290 | 7,658 | 756 | 8,278 |
Total Other (Loss) Income | (251) | 7,922 | (14,561) | 9,328 |
(Loss) Income Before Income Taxes | (36,163) | 17,860 | (56,293) | 74,673 |
Income taxes | (860) | 1,942 | (372) | 17,242 |
Consolidated and Comprehensive Net (Loss) Income | (35,303) | 15,918 | (55,921) | 57,431 |
Less: Net loss (income) attributable to noncontrolling interests | 21,140 | (9,760) | 33,945 | (41,680) |
Less: Net income attributable to redeemable noncontrolling interests | (374) | (432) | (1,327) | (1,238) |
Net (Loss) Income Attributable to Och-Ziff Capital Management Group LLC | (14,537) | 5,726 | (23,303) | 14,513 |
Less: Change in redemption value of Preferred Units | 0 | 0 | 0 | (2,853) |
Net (Loss) Income Attributable to Class A Shareholders | $ (14,537) | $ 5,726 | $ (23,303) | $ 11,660 |
(Loss) Earnings per Class A Share | ||||
(Loss) Income Per Class A Share, Basic (in dollars per share) | $ (0.08) | $ 0.03 | $ (0.12) | $ 0.06 |
(Loss) Income Per Class A Share, Diluted (in dollars per share) | $ (0.08) | $ 0.03 | $ (0.12) | $ 0.06 |
Weighted-Average Class A Shares Outstanding, Basic (in shares) | 192,657,766 | 186,235,651 | 192,485,281 | 186,201,389 |
Weighted-Average Class A Shares Outstanding, Diluted (in shares) | 192,657,766 | 186,235,651 | 192,485,281 | 186,201,389 |
Management fees | ||||
Revenues | ||||
Investment management revenues | $ 70,675 | $ 77,171 | $ 213,718 | $ 243,508 |
Incentive income | ||||
Revenues | ||||
Investment management revenues | $ 19,303 | $ 51,249 | $ 104,793 | $ 168,990 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' (Deficit) Equity - USD ($) $ in Thousands | Total | Class A Shares | Class B Shares | Paid-in Capital | Accumulated Deficit | Shareholders' Deficit Attributable to Class A Shareholders | Shareholders' Equity Attributable to Noncontrolling Interests |
Balance at Beginning of Period (values) at Dec. 31, 2016 | $ (294,092) | $ 3,097,431 | $ (3,563,452) | $ (466,021) | $ 171,929 | ||
Balance at Beginning of Period (shares) at Dec. 31, 2016 | 184,843,255 | 297,317,019 | |||||
Increase (Decrease) in Shareholders' (Deficit) Equity [Roll Forward] | |||||||
Capital contributions | 251 | 251 | |||||
Capital distributions | (4,563) | (4,563) | |||||
Cash dividends declared on Class A Shares | (1,849) | (1,849) | (1,849) | ||||
Dividend equivalents on Class A restricted share units | 151 | (151) | |||||
Equity-based compensation, net of taxes (values) | 18,217 | 7,451 | 7,451 | 10,766 | |||
Relinquishment of Group A Units (shares) | (30,000,000) | ||||||
Equity-based compensation (shares) | 283,698 | 172,459 | |||||
Impact of changes in Oz Operating Group ownership | (12,173) | (12,173) | 12,173 | ||||
Dilution of Proceeds From Tax Receivable Agreement Waiver | (21,219) | (21,219) | 21,219 | ||||
Change in redemption value of Preferred Units | (7,446) | (2,853) | (2,853) | (4,593) | |||
Comprehensive net income (loss), excluding amounts attributable to redeemable noncontrolling interests | 5,467 | (4,311) | (4,311) | 9,778 | |||
Balance at End of Period (values) at Mar. 31, 2017 | (284,015) | 3,068,788 | (3,569,763) | (500,975) | 216,960 | ||
Balance at End of Period (shares) at Mar. 31, 2017 | 185,126,953 | 267,489,478 | |||||
Increase (Decrease) in Shareholders' (Deficit) Equity [Roll Forward] | |||||||
Capital contributions | 341 | 341 | |||||
Capital distributions | (5,634) | (5,634) | |||||
Cash dividends declared on Class A Shares | (3,703) | (3,703) | (3,703) | ||||
Dividend equivalents on Class A restricted share units | 114 | (114) | |||||
Equity-based compensation, net of taxes (values) | 22,715 | 9,294 | 9,294 | 13,421 | |||
Class B Shares granted to holders of P Units (shares) | 71,850,000 | ||||||
Equity-based compensation (shares) | 87,739 | ||||||
Impact of changes in Oz Operating Group ownership | (46) | (46) | 46 | ||||
Comprehensive net income (loss), excluding amounts attributable to redeemable noncontrolling interests | 35,240 | 13,098 | 13,098 | 22,142 | |||
Balance at End of Period (values) at Jun. 30, 2017 | (235,056) | 3,078,150 | (3,560,482) | (482,332) | 247,276 | ||
Balance at End of Period (shares) at Jun. 30, 2017 | 185,214,692 | 339,339,478 | |||||
Increase (Decrease) in Shareholders' (Deficit) Equity [Roll Forward] | |||||||
Capital contributions | 191 | 191 | |||||
Capital distributions | (6,120) | (6,120) | |||||
Cash dividends declared on Class A Shares | (3,704) | (3,704) | (3,704) | ||||
Dividend equivalents on Class A restricted share units | 173 | (173) | |||||
Equity-based compensation, net of taxes (values) | 21,919 | 8,971 | 8,971 | 12,948 | |||
Equity-based compensation (shares) | 97,747 | ||||||
Impact of changes in Oz Operating Group ownership | (47) | (47) | 47 | ||||
Comprehensive net income (loss), excluding amounts attributable to redeemable noncontrolling interests | 15,486 | 5,726 | 5,726 | 9,760 | |||
Balance at End of Period (values) at Sep. 30, 2017 | (207,284) | 3,087,247 | (3,558,633) | (471,386) | 264,102 | ||
Balance at End of Period (shares) at Sep. 30, 2017 | 185,312,439 | 339,339,478 | |||||
Increase (Decrease) in Shareholders' (Deficit) Equity [Roll Forward] | |||||||
Impact of adoption of ASU 2014-09 | 116,984 | 41,922 | 41,922 | 75,062 | |||
Balance at Beginning of Period (values) at Dec. 31, 2017 | (95,929) | 3,102,074 | (3,555,905) | (453,831) | 357,902 | ||
Balance at Beginning of Period (shares) at Dec. 31, 2017 | 189,573,210 | 339,339,478 | |||||
Increase (Decrease) in Shareholders' (Deficit) Equity [Roll Forward] | |||||||
Capital contributions | 750 | 750 | |||||
Capital distributions | (17,690) | (17,690) | |||||
Cash dividends declared on Class A Shares | (13,354) | (13,354) | (13,354) | ||||
Dividend equivalents on Class A restricted share units | 1,072 | (1,072) | |||||
Equity-based compensation, net of taxes (values) | 18,476 | 7,803 | 0 | 7,803 | 10,673 | ||
Equity-based compensation (shares) | 1,556,563 | (35,000,000) | |||||
Impact of changes in Oz Operating Group ownership | 190 | 190 | (190) | ||||
Comprehensive net income (loss), excluding amounts attributable to redeemable noncontrolling interests | 12,125 | 3,490 | 3,490 | 8,635 | |||
Balance at End of Period (values) at Mar. 31, 2018 | 21,362 | 3,111,139 | (3,524,919) | (413,780) | 435,142 | ||
Balance at End of Period (shares) at Mar. 31, 2018 | 191,129,773 | 304,339,478 | |||||
Increase (Decrease) in Shareholders' (Deficit) Equity [Roll Forward] | |||||||
Capital contributions | 128 | 128 | |||||
Capital distributions | (6,793) | (6,793) | |||||
Cash dividends declared on Class A Shares | (3,823) | (3,823) | (3,823) | ||||
Dividend equivalents on Class A restricted share units | (195) | 195 | |||||
Equity-based compensation, net of taxes (values) | 21,369 | 9,025 | 9,025 | 12,344 | |||
Equity-based compensation (shares) | 139,812 | (500,000) | |||||
Impact of changes in Oz Operating Group ownership | (505) | (505) | 505 | ||||
Comprehensive net income (loss), excluding amounts attributable to redeemable noncontrolling interests | (33,696) | (12,256) | (12,256) | (21,440) | |||
Balance at End of Period (values) at Jun. 30, 2018 | (1,453) | 3,119,464 | (3,540,803) | (421,339) | 419,886 | ||
Balance at End of Period (shares) at Jun. 30, 2018 | 191,269,585 | 303,839,478 | |||||
Increase (Decrease) in Shareholders' (Deficit) Equity [Roll Forward] | |||||||
Capital contributions | 24 | 24 | |||||
Capital distributions | (5,611) | (5,611) | |||||
Cash dividends declared on Class A Shares | (3,829) | (3,829) | (3,829) | ||||
Dividend equivalents on Class A restricted share units | 90 | (90) | |||||
Equity-based compensation, net of taxes (values) | 21,748 | 9,238 | 9,238 | 12,510 | |||
Relinquishment of Group A Units (shares) | (3,500,000) | ||||||
Equity-based compensation (shares) | 337,674 | 0 | |||||
Impact of changes in Oz Operating Group ownership | (205) | (205) | 205 | ||||
Comprehensive net income (loss), excluding amounts attributable to redeemable noncontrolling interests | (35,677) | (14,537) | (14,537) | (21,140) | |||
Balance at End of Period (values) at Sep. 30, 2018 | $ (24,798) | $ 3,128,587 | $ (3,559,259) | $ (430,672) | $ 405,874 | ||
Balance at End of Period (shares) at Sep. 30, 2018 | 191,607,259 | 300,339,478 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' (Deficit) Equity Consolidated Statement of Changes in Shareholders' (Deficit) Equity (Parenthetical) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | |
Statement of Stockholders' Equity [Abstract] | ||||||
Dividends Paid per Class A Share (in dollars per share) | $ 0.02 | $ 0.02 | $ 0.07 | $ 0.02 | $ 0.02 | $ 0.01 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash Flows from Operating Activities | ||
Consolidated net (loss) income | $ (55,921) | $ 57,431 |
Adjustments to reconcile consolidated net (loss) income to net cash provided by operating activities: | ||
Amortization of equity-based compensation | 67,848 | 63,696 |
Depreciation, amortization and net gains and losses on fixed assets | 7,709 | 7,693 |
Net losses on early retirement of debt | 14,303 | 0 |
Deferred income taxes | (3,341) | 12,395 |
Net losses (gains) on investments in funds and joint ventures, net of dividends | 4,238 | (1,050) |
Operating cash flows due to changes in: | ||
Income and fees receivable | 343,769 | 98,791 |
Due from related parties | (4,141) | (2,308) |
Other assets, net | 35,489 | 27,175 |
Compensation payable | (145,612) | (152,838) |
Unearned incentive income | 23,697 | 26,754 |
Due to related parties | 442 | (153) |
Other liabilities | 8 | (21,468) |
Consolidated funds related items: | ||
Net gains of consolidated funds | (756) | (8,278) |
Purchases of investments | (333,657) | (383,184) |
Proceeds from sale of investments | 194,802 | 146,907 |
Other assets of consolidated funds | (26,888) | (306,453) |
Other liabilities of consolidated funds | 25,792 | 78,044 |
Cash Provided by (Used in) Operating Activities | 147,781 | (356,846) |
Cash Flows from Investing Activities | ||
Purchases of fixed assets | (3,596) | (3,857) |
Proceeds from sale of fixed assets | 0 | 57,599 |
Purchases of United States government obligations | (293,183) | (112,400) |
Maturities of United States government obligations | 20,500 | 0 |
Investments in funds | (152,272) | (132,102) |
Proceeds from sales and maturities in investments in funds | 172,950 | 4,310 |
Cash Used in Investing Activities | (255,601) | (186,450) |
Cash Flows from Financing Activities | ||
Issuance and sale of Preferred Units, net of issuance costs | 0 | 150,054 |
Contributions from noncontrolling and redeemable noncontrolling interests | 150,074 | 3,066 |
Distributions to noncontrolling and redeemable noncontrolling interests | (41,005) | (16,317) |
Dividends on Class A Shares | (21,006) | (9,256) |
Proceeds from debt obligations, net of issuance costs | 301,681 | 127,864 |
Repayment of debt obligations, including prepayment costs | (595,431) | (167,319) |
Proceeds from securities sold under agreements to repurchase, net of issuance costs | 42,348 | 0 |
Proceeds from debt obligations of consolidated CLO | 0 | 666,712 |
Repayment of debt obligation of consolidated CLO | 0 | (222,434) |
Other Financing Cash Flows | (3,313) | (970) |
Cash (Used in) Provided by Financing Activities | (166,652) | 531,400 |
Net Change in Cash and Cash Equivalents | (274,472) | (11,896) |
Cash and Cash Equivalents, Beginning of Period | 469,513 | 329,813 |
Cash and Cash Equivalents, End of Period | 195,041 | 317,917 |
Cash paid during the period: | ||
Interest | 25,245 | 11,199 |
Income taxes | 2,061 | 3,196 |
Non-cash transactions: | ||
Assets related to the initial consolidation of CLO | 0 | 100,156 |
Liabilities related to the initial consolidation of CLO | 0 | 99,878 |
Assets related to the deconsolidation of funds | 0 | 653,629 |
Liabilities related to the deconsolidation of funds | $ 0 | $ 629,282 |
Overview
Overview | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview | OVERVIEW Och-Ziff Capital Management Group LLC (the “Registrant”), a Delaware limited liability company, together with its consolidated subsidiaries (collectively, the “Company”), is a global alternative asset management firm with offices in New York, London, Hong Kong, Mumbai, Beijing, and Shanghai. The Company provides asset management services to its investment funds, which pursue a broad range of global investment opportunities. The Company currently manages multi-strategy funds, dedicated credit funds, including opportunistic credit funds and Institutional Credit Strategies products, real estate funds and other alternative investment vehicles (collectively the “funds”). Through Institutional Credit Strategies, the Company’s asset management platform that invests in performing credits, the Company manages collateralized loan obligations (“CLOs”) and other customized solutions for clients. The Company’s primary sources of revenues are management fees, which are based on the amount of the Company’s assets under management, and incentive income, which is based on the investment performance of its funds. Accordingly, for any given period, the Company’s revenues will be driven by the combination of assets under management and the investment performance of the funds. The Company currently has two operating segments: the Oz Funds segment and the Company ’ s real estate business. T he Oz Funds segment is currently the Company’s only reportable operating segment under U.S. generally accepted accounting principles (“GAAP”) and provides asset management services to the Company’s multi-strategy funds, dedicated credit funds and other alternative investment vehicles. The Company’s real estate business, which provides asset management services to its real estate funds, is included within Other Operations, as it does not meet the threshold of a reportable operating segment. The Company generates substantially all of its revenues in the United States. The liability of the Company’s Class A Shareholders is limited to the extent of their capital contributions. The Company conducts its operations through OZ Management LP, OZ Advisors LP and OZ Advisors II LP and their consolidated subsidiaries (collectively, the “Oz Operating Group”). References to the Company’s “executive managing directors” refer to the current limited partners of OZ Management LP, OZ Advisors LP and OZ Advisors II LP other than the Company’s intermediate holding companies, and include the Company’s founder, Daniel S. Och, and, except where the context requires otherwise, include certain limited partners who are no longer active in the business of the Company. References to the Company’s “active executive managing directors” refer to executive managing directors who remain active in the Company’s business. References to the “Ziffs” refer collectively to Ziff Investors Partnership, L.P. II and certain of its affiliates and control persons. References to the Company’s “intermediate holding companies” refer, collectively, to Och-Ziff Holding Corporation (“Oz Corp”) and Och-Ziff Holding LLC, each of which are wholly owned subsidiaries of the Registrant. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Significant Accounting Policies | BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation These unaudited, interim, consolidated financial statements are prepared in accordance with GAAP as set forth in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”), and should be read in conjunction with the audited consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2017 (the “Annual Report”). In the opinion of management, all adjustments considered necessary for a fair presentation of the Company’s unaudited, interim, consolidated financial statements have been included and are of a normal and recurring nature. All significant intercompany transactions and balances have been eliminated in consolidation. The results of operations presented for the interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. For example, incentive income for the majority of the Company’s multi-strategy assets under management is recognized in the fourth quarter each year, based on full year investment performance. Revenue Recognition Policies The Company provides asset management services to its customers, including certain administrative services related to the funds’ operations, in exchange for management and incentive fees, which are included in the Company’s agreements with its customers. The services provided in connection with the identified performance obligations are satisfied over time. The agreements are generally automatically renewed on an annual basis unless the agreements are terminated by the general partner or directors of the respective funds. Management Fees Management fees for the Company’s multi-strategy funds typically range from 0.98% to 2.25% annually of assets under management based on the net asset value of these funds. For the Company’s opportunistic credit funds, management fees typically range from 0.75% to 1.75% annually based on the net asset value of these funds. Management fees for Institutional Credit Strategies, which relate primarily to the Company’s CLOs, generally range from 0.35% to 0.50% annually, and for CLOs are based on the par value of the collateral and cash held in the CLOs. Management fees for the Company’s real estate funds typically range from 0.75% to 1.50% annually based on the amount of capital committed or invested during the investment period, and on the amount of invested capital after the investment period. Management fees are recognized over the period during which the related services are performed. Management fees are generally calculated and paid to the Company on a quarterly basis in advance, based on the amount of assets under management at the beginning of the quarter. Management fees are prorated for capital inflows and redemptions during the quarter. Accordingly, changes in the Company’s management fee revenues from quarter to quarter are driven by changes in the quarterly opening balances of assets under management, the relative magnitude and timing of inflows and redemptions during the respective quarter, as well as the impact of differing management fee rates charged on those inflows and redemptions. The Company considers management fees to be a form of variable consideration, as the amount earned each quarter may depend on various contingencies, such as the value of assets under management, capital inflows and outflows during the period, or changes in committed or invested capital. Management fees, however, are generally crystallized at the end of each reporting period and are not subject to clawback and, therefore, the value of the management fees the Company is entitled to receive at the end of each quarter is generally no longer subject to the constraint. Incentive Income The Company earns incentive income based on the cumulative performance of the funds over a commitment period. Prior to the adoption of new revenue recognition accounting guidance in 2018, incentive income was recognized at the end of the applicable commitment period when the amounts were contractually payable, or “crystallized,” and when no longer subject to clawback. Beginning in 2018, as a result of the adoption of the new revenue recognition accounting guidance, the Company recognizes incentive income when such amounts are probable of not significantly reversing. Incentive income is typically equal to 20% of the realized and unrealized profits, net of management fees, attributable to each fund investor in the Company’s multi-strategy funds, open-end opportunistic credit funds and certain other funds. Incentive income excludes unrealized gains and losses attributable to investments that the Company, as investment manager, believes lack a readily ascertainable market value, are illiquid or should be held until the resolution of a special event or circumstance (“Special Investments”). For the Company’s closed-end opportunistic credit funds, real estate funds and certain other funds, incentive income is typically equal to 20% of the realized profits, net of management fees, attributable to each fund investor. For CLOs, incentive income is typically 20% of the excess cash flows available to the holders of the subordinated notes. The Company’s ability to earn incentive income from some of its funds may be impacted by hurdle rates, whereby the Company is not entitled to incentive income until the investment returns exceed an agreed upon benchmark. For a portion of these assets subject to hurdle rates, once the investment performance has exceeded the hurdle rate, the Company may receive a preferential “catch-up” allocation, equal to a full 20% of the net profits attributable to investors in these assets. All of the Company’s multi-strategy funds and open-end opportunistic credit funds are subject to a perpetual loss carry forward, or perpetual “high-water mark,” meaning the Company will not be able to earn incentive income with respect to positive investment performance it generates for a fund investor in any year following negative investment performance until that loss is recouped, at which point a fund investor’s investment surpasses the high-water mark. The Company earns incentive income on any profits, net of management fees, in excess of the high-water mark. The commitment period for most of the Company’s multi-strategy assets under management is for a period of one year on a calendar-year basis with income recognized annually, and therefore it generally crystallizes incentive income annually on December 31. The Company may also recognize incentive income related to fund investor redemptions at other times during the year, as well as on assets under management subject to commitment periods that are longer than one year. The Company may also recognize incentive income for tax distributions related to these assets. Such distributions are amounts distributed to the Company to cover tax liabilities related to incentive income that has been accrued at the fund level but would otherwise not be recognized by the Company until it is probable that a significant reversal will not occur. These distributions are not subject to clawback once distributed to the Company. Incentive income is considered variable consideration, the recognition of which is subject to constraint. Incentive income is no longer constrained when it is probable that a significant reversal will not occur. Determining the amount of incentive income to record is subject to qualitative and quantitative factors including, where a fund is in its life-cycle, whether the Company has received or is entitled to receive incentive income distributions and potential sales of fund investments. The Company continuously evaluates whether there are additional considerations that could potentially impact the recognition of incentive income. To the extent that distributions have been received, but for which the recognition of incentive income is not appropriate, the Company will recognize a liability for unearned incentive income. See Note 10 for additional information regarding the Company’s revenues. Other Revenues Other revenues consist primarily of interest income on investments in CLOs and cash and cash equivalents. Interest income is recognized on an effective yield basis. Additionally, prior to the sale of the Company’s aircraft in the first half of 2017, revenue related to non-business use of the corporate aircraft by certain executive managing directors was also included within other revenues. Revenue earned from non-business use of the corporate aircraft was recognized on an accrual basis based on actual flight hours. Securities Sold Under Agreements to Repurchase Securities sold under agreements to repurchase (“repurchase agreements”) are accounted for as collateralized financing transactions. The Company provides securities to counterparties to collateralize amounts borrowed under repurchase agreements on terms that permit the counterparties to repledge or resell the securities to others. Cash borrowed is included within securities sold under agreements to repurchase in the consolidated balance sheets. Securities transferred to counterparties under repurchase agreements are included within investments in the consolidated balance sheets. Interest expense incurred on these transactions is included within interest expenses in the consolidated statements of comprehensive income (loss). See Note 9 for additional information. Recently Adopted Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition , and most industry-specific revenue recognition guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted ASU 2014-09 using a modified retrospective application approach as of the beginning of the first quarter of 2018 to all contracts within the scope of the standard as of the date of adoption. As a result of the adoption of ASU 2014-09, the Company now recognizes certain incentive income earlier than as prescribed under guidance in effect for fiscal year 2017, as the threshold for recognition of incentive income under ASU 2014-09 is lower than under the previous standard. The Company recognized an opening adjustment to shareholders’ equity of $117.0 million , which is net of $11.3 million of income tax, of which $41.9 million was attributable to Class A shareholders. The following table details the post-tax impact on the Company’s opening shareholders’ equity, by fund type, upon the adoption of ASU 2014-09: (dollars in thousands) Multi-strategy funds $ 2,727 Opportunistic credit funds 24,462 Real estate funds 89,795 Total $ 116,984 The adoption of this guidance resulted in a decrease to the liability for unearned incentive income of $99.4 million and an increase in income and fees receivable of $28.8 million . In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The Company elected to early adopt the standard in the third quarter of 2018. The impacts of adoption are reflected in certain disclosures in Note 4 and include removing disclosures related to: the amount of and reasons for transfers between Levels I and II of the fair value hierarchy, the policy for timing of transfers between levels, and the valuation processes for Level III fair value measurements. The adoption of the standard did not have a material effect on the Company’s consolidated financial statements. None of the other changes to GAAP that went into effect in the nine months ended September 30, 2018 had a material effect on the Company’s consolidated financial statements. Future Adoption of Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases. ASU 2016-02 requires that, for leases longer than one year, a lessee recognize in the consolidated balance sheets a right of use asset, representing the right to use the underlying asset for the lease term, and a lease liability, representing the requirement to make lease payments. The recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from existing guidance. The requirements of ASU 2016-02 are effective for the Company beginning in the first quarter of 2019. The Company expects its total assets and total liabilities in its consolidated balance sheets to increase upon adoption as a result of recording a lease asset and lease liability related to the Company’s operating leases. The Company is continuing to evaluate the impact that this guidance will have on its consolidated financial statements. See Note 15 of the Company’s Annual Report for details related to the Company’s existing operating lease obligations. None of the other changes to GAAP that are not yet effective are expected to have a material effect on the Company’s consolidated financial statements. |
Noncontrolling Interests
Noncontrolling Interests | 9 Months Ended |
Sep. 30, 2018 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | NONCONTROLLING INTERESTS AND OZ OPERATING GROUP OWNERSHIP Noncontrolling interests represent ownership interests in the Company’s subsidiaries held by parties other than the Company, and primarily relate to the Group A Units held by the Company’s executive managing directors. Net (loss) income attributable to the Group A Units is driven by the earnings of the Oz Operating Group. The following table presents the components of the net (loss) income attributable to noncontrolling interests: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Group A Units $ (21,798 ) $ 9,500 $ (35,343 ) $ 41,145 Other 658 260 1,398 535 $ (21,140 ) $ 9,760 $ (33,945 ) $ 41,680 The following table presents the components of the shareholders’ equity attributable to noncontrolling interests: September 30, 2018 December 31, 2017 (dollars in thousands) Group A Units $ 400,822 $ 353,791 Other 5,052 4,111 $ 405,874 $ 357,902 The Preferred Units and fund investors’ interests in certain consolidated funds are redeemable outside of the Company’s control. These interests are classified within redeemable noncontrolling interests in the consolidated balance sheets. The following tables present the activity in redeemable noncontrolling interests: Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Consolidated Funds Preferred Units Total Consolidated Funds Preferred Units Total (dollars in thousands) Beginning balance $ 53,507 $ 420,000 $ 473,507 $ 25,617 $ 420,000 $ 445,617 Capital contributions 111,887 — 111,887 149,172 — 149,172 Capital distributions (562 ) — (562 ) (10,910 ) — (10,910 ) Comprehensive income 374 — 374 1,327 — 1,327 Ending Balance $ 165,206 $ 420,000 $ 585,206 $ 165,206 $ 420,000 $ 585,206 Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Consolidated Funds Preferred Units Total Consolidated Funds Preferred Units Total (dollars in thousands) Beginning balance $ 24,678 $ 420,000 $ 444,678 $ 21,621 $ 262,500 $ 284,121 Change in redemption value of Preferred Units — — — — 7,446 7,446 Preferred Units issuance, net of issuance costs — — — — 150,054 150,054 Capital contributions 32 — 32 2,283 — 2,283 Comprehensive income 432 — 432 1,238 — 1,238 Ending Balance $ 25,142 $ 420,000 $ 445,142 $ 25,142 $ 420,000 $ 445,142 Oz Operating Group Ownership The Company’s equity interest in the Oz Operating Group increased to 42.6% as of September 30, 2018 , from 41.5% as of December 31, 2017 , (excluding Group P Units, as they are not yet participating in the economics of the Oz Operating Group). Changes in the Company’s interest in the Oz Operating Group have historically been, and in the future may be, driven by the following: (i) the exchange of Group A Units and Group P Units for an equal number of Class A Shares, at which time the related Class B Shares are also canceled; (ii) the issuance of Class A Shares under the Company’s Amended and Restated 2007 Equity Incentive Plan and 2013 Incentive Plan related to the settlement of Class A restricted share units (the “RSUs”) or Class A performance-based RSUs (the “PSUs”); (iii) the forfeiture of Group A Units and participating Group P Units by a departing executive managing director; and (iv) the repurchase of Class A Shares and Group A Units. The Company’s interest in the Oz Operating Group is expected to continue to increase over time as additional Class A Shares are issued upon the exchange of Group A Units and Group P Units, as well as the settlement of vested RSUs or PSUs. These increases will be offset upon any conversion by an executive managing director of Group D Units, which are not considered equity for GAAP purposes, into Group A Units, at which time an equal number of Class B Shares is also issued to the executive managing director. Additionally, the Company’s economic interest in the Oz Operating Group will decline when Group P Units begin to participate, as described in Note 10 in the Annual Report. Relinquishment of Group A Units In the third quarter of 2018, a former executive managing director of the Company relinquished 3,500,000 Group A Units and an equal number of Class B Shares. |
Investments and Fair Value Disc
Investments and Fair Value Disclosures | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | INVESTMENTS AND FAIR VALUE DISCLOSURES The following table presents the components of the Company’s investments as reported in the consolidated balance sheets: September 30, 2018 December 31, 2017 (dollars in thousands) United States government obligations, at fair value $ 287,164 $ 12,973 CLOs, at fair value 165,795 211,749 Other funds and joint ventures, equity method 32,251 14,252 Total Investments $ 485,210 $ 238,974 In the second quarter of 2018, as a result of a recent court decision that vacates application of U.S. risk retention rules in certain CLO transactions, the Company sold certain of its investments in CLOs. The Company is still subject to EU risk retention rules for certain CLOs managed by the Company, and continues to hold investments in CLOs subject to these requirements . Fair Value Disclosures Fair value represents the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date (i.e., an exit price). Due to the inherent uncertainty of valuations of investments that are determined to be illiquid or do not have readily ascertainable fair values, the estimates of fair value may differ from the values ultimately realized, and those differences can be material. GAAP prioritizes the level of market price observability used in measuring assets and liabilities at fair value. Market price observability is impacted by a number of factors, including the type of assets and liabilities and the specific characteristics of the assets and liabilities. Assets and liabilities with readily available, actively quoted prices or for which fair value can be measured from actively-quoted prices generally will have a higher degree of market price observability and lesser degree of judgment used in measuring fair value. Assets and liabilities measured at fair value are classified into one of the following categories: • Level I – Fair value is determined using quoted prices that are available in active markets for identical assets or liabilities. The types of assets and liabilities that would generally be included in this category are certain listed equities, U.S. government obligations and certain listed derivatives. • Level II – Fair value is determined using quotations received from dealers making a market for these assets or liabilities (“broker quotes”), valuations obtained from independent third-party pricing services, the use of models or other valuation methodologies based on pricing inputs that are either directly or indirectly market observable as of the measurement date. The types of assets and liabilities that would generally be included in this category are certain corporate bonds, certain credit default swap contracts, certain bank debt securities, certain commercial real estate debt, less liquid equity securities, forward contracts and certain over the-counter (“OTC”) derivatives. • Level III – Fair value is determined using pricing inputs that are unobservable in the market and includes situations where there is little, if any, market activity for the asset or liability. The fair value of assets and liabilities in this category may require significant judgment or estimation in determining fair value of the assets or liabilities. The fair value of these assets and liabilities may be estimated using a combination of observed transaction prices, independent pricing services, relevant broker quotes, models or other valuation methodologies based on pricing inputs that are neither directly or indirectly market observable. The types of assets and liabilities that would generally be included in this category include CLOs, real estate investments, equity and debt securities issued by private entities, limited partnerships, certain corporate bonds, certain credit default swap contracts, certain bank debt securities, certain commercial real estate debt, certain OTC derivatives, residential and commercial mortgage-backed securities, asset-backed securities, collateralized debt obligations and investments in affiliated credit funds. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Fair Value Measurements Categorized within the Fair Value Hierarchy The following table summarizes the Company’s investments measured at fair value on a recurring basis within the fair value hierarchy as of September 30, 2018 : As of September 30, 2018 Level I Level II Level III Total (dollars in thousands) Assets, at Fair Value Included within cash and cash equivalents: United States government obligations $ 79,994 $ — $ — $ 79,994 Included within investments: United States government obligations $ 287,164 $ — $ — $ 287,164 CLOs (1) $ — $ — $ 165,795 $ 165,795 Investments of consolidated funds: Bank debt $ — $ 120,468 $ 61,598 $ 182,066 Corporate bonds — 1,828 — 1,828 Total Investments of Consolidated Funds $ — $ 122,296 $ 61,598 $ 183,894 _______________ (1) As of September 30, 2018 , investments in CLOs had contractual principal amounts of $153.2 million outstanding, which excludes the Company’s investments in subordinated tranches of the notes, as these do not have contractual principal payments. The following table summarizes the Company’s investments measured at fair value on a recurring basis within the fair value hierarchy as of December 31, 2017 : As of December 31, 2017 Level I Level II Level III Total (dollars in thousands) Assets, at Fair Value Included within cash and cash equivalents: United States government obligations $ 99,704 $ — $ — $ 99,704 Included within investments: United States government obligations $ 12,973 $ — $ — $ 12,973 CLOs (1) $ — $ — $ 211,749 $ 211,749 Investments of consolidated funds: Bank debt $ — $ 24,559 $ 18,807 $ 43,366 _______________ (1) As of December 31, 2017 , investments in CLOs had contractual principal amounts of $189.2 million outstanding, which excludes the Company’s investments in subordinated tranches of the notes, as these do not have contractual principal payments. Reconciliation of Fair Value Measurements Categorized within Level III Gains and losses, excluding those of the consolidated funds are recorded within net (losses) gains on investments in funds and joint ventures in the consolidated statements of comprehensive income (loss), and gains and losses of the consolidated funds are recorded within net gains of consolidated funds. Foreign exchange gains and losses on non-U.S. Dollar investments are also included within gains and losses in the tables below. The following table summarizes the changes in the Company’s Level III investments for the three months ended September 30, 2018 : June 30, 2018 Transfers Transfers Investment Investment Gains / Losses September 30, 2018 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ 148,127 $ — $ — $ 24,655 $ (5,483 ) $ (1,504 ) $ 165,795 Investments of consolidated funds: Bank debt $ 32,515 $ 6,094 $ (13,795 ) $ 55,761 $ (19,356 ) $ 379 $ 61,598 The following table summarizes the changes in the Company’s Level III investments for the three months ended September 30, 2017 : June 30, 2017 Transfers Transfers Investment Investment Gains / Losses September 30, 2017 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ 43,723 $ — $ — $ 132,685 $ — $ 395 $ 176,803 Investments of consolidated funds: Bank debt $ 39,338 $ 8,840 $ (21,900 ) $ 30,470 $ (33,975 ) $ 564 $ 23,337 The following tables summarize the changes in the Company’s Level III assets and liabilities for the nine months ended September 30, 2018 : December 31, 2017 Transfers Transfers Investment Investment Gains / Losses September 30, 2018 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ 211,749 $ — $ — $ 131,104 $ (170,403 ) $ (6,655 ) $ 165,795 Investments of consolidated funds: Bank debt $ 18,807 $ 2,438 $ (1,690 ) $ 114,154 $ (72,838 ) $ 727 $ 61,598 The following tables summarize the changes in the Company’s Level III assets and liabilities for the nine months ended September 30, 2017 : December 31, 2016 Transfers Transfers Investment Investment Gains / Losses September 30, 2017 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ 21,341 $ — $ — $ 152,885 $ — $ 2,577 $ 176,803 Investments of consolidated funds: Bank debt $ 18,127 $ 767 $ (17,311 ) $ 87,611 $ (67,082 ) $ 1,225 $ 23,337 In the second quarter of 2017, the Company consolidated a CLO, the amounts related to the initial consolidation of the CLO are reflected in the investment purchases in the table above. The Company deconsolidated the CLO in the third quarter of 2017, amounts related to the deconsolidation of the CLO are included within investment sales. Transfers out of Level III presented in the tables above resulted from the fair values of certain securities becoming market observable, with fair value determined using independent pricing services. Transfers into Level III presented in the table above resulted from the valuation of certain investments with decreased market observability, with fair values determined using independent pricing services. The table below summarizes the net change in unrealized gains and losses on the Company’s Level III investments held as of the reporting date: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ (1,576 ) $ 178 $ (4,944 ) $ 2,360 Investments of consolidated funds: Bank debt $ 240 $ 61 $ 274 $ 142 Valuation Methodologies for Fair Value Measurements Categorized within Levels II and III Investments in CLOs, bank debt and corporate bonds are valued using independent pricing services, and therefore the Company does not have transparency into the significant inputs used by such services. The Company elected to measure its investments in CLOs at fair value through consolidated net (loss) income in order to simplify its accounting for these instruments. Changes in fair value of these investments are included within net gains on investments in funds and joint ventures in the consolidated statements of comprehensive income (loss). The Company accrues interest income on its investments in CLOs using the effective interest method. Fair Value of Other Financial Instruments Management estimates that the carrying value of the Company’s other financial instruments, including its debt obligations, approximated their fair values as of September 30, 2018 . The 2018 Term Loan and the CLO Investments Loans (each as defined in Note 8 ) are categorized as Level III within the fair value hierarchy. The fair value of the 2018 Term Loan and the CLO Investments Loans were determined using independent pricing services. Loans Sold to CLOs Managed by the Company During the nine months ended September 30, 2018 and 2017 , the Company sold $29.8 million and $45.6 million of loans to CLOs managed by the Company, respectively. These loans were previously purchased by the Company in the open market, and were sold for cash at cost to the CLOs. The loans were accounted for as transfers of financial assets and met the criteria for derecognition under GAAP. The Company invests in senior secured and subordinated notes issued by certain CLOs to which it sold the loans discussed above. These investments represent retained interests to the Company and are in the form of a 5% vertical strip (i.e., 5% of each of the senior and subordinated tranches of notes issues by each CLO). The retained interests are reported within investments on the Company’s consolidated balance sheet. During the nine months ended September 30, 2018 , the Company made investments of $24.9 million related to these retained interests. As of September 30, 2018 and December 31, 2017 , the Company’s investments in these retained interests had a fair value of $91.8 million and $70.4 million , respectively. The Company is subject to risks associated with the performance of the underlying collateral and the market yield of the assets. The Company’s risk of loss from retained interest is limited to its investments in these interests. The Company receives quarterly payments of interest and principal, as applicable, on these retained interests. In the nine months ended September 30, 2018 and 2017 , the Company received $5.5 million and $474 thousand , respectively, of interest and principal payments related to the retained interests. The Company uses independent pricing services to value its investments in the CLOs, including the retained interests, and therefore the only key assumption is the price provided by such service. A corresponding adverse change of 10% or 20% on price would have a corresponding impact on the fair value of the Company’s investments in CLOs. |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | VARIABLE INTEREST ENTITIES In the ordinary course of business, the Company sponsors the formation of funds that are considered VIEs. See Note 2 of the Company’s Annual Report for a discussion of entities that are VIEs and the evaluation of those entities for consolidation by the Company. The table below presents the assets and liabilities of VIEs consolidated by the Company: September 30, 2018 December 31, 2017 (dollars in thousands) Assets Assets of consolidated funds: Investments of consolidated funds, at fair value $ 183,894 $ 43,366 Other assets of consolidated funds 39,302 13,331 Total Assets $ 223,196 $ 56,697 Liabilities Liabilities of consolidated funds: Other liabilities of consolidated funds 37,134 11,340 Total Liabilities $ 37,134 $ 11,340 The assets presented in the table above belong to the investors in those funds, are available for use only by the fund to which they belong, and are not available for use by the Company. The consolidated funds have no recourse to the general credit of the Company with respect to any liability. The Company’s direct involvement with funds that are VIEs and not consolidated by the Company is generally limited to providing asset management services and, in certain cases, insignificant direct investments in the VIEs. The maximum exposure to loss represents the potential loss of current investments or income and fees receivables from these entities, as well as the obligation to repay unearned revenues, primarily incentive income subject to clawback, in the event of any future fund losses. The Company has commitments to certain funds that are VIEs as discussed in Note 16 . The Company does not provide, nor is it required to provide, any type of non-contractual financial or other support to its VIEs that are not consolidated. The table below presents the net assets of VIEs in which the Company has variable interests along with the maximum risk of loss as a result of the Company’s involvement with VIEs: September 30, 2018 December 31, 2017 (dollars in thousands) Net assets of unconsolidated VIEs in which the Company has a variable interest $ 10,093,690 $ 8,300,163 Maximum risk of loss as a result of the Company’s involvement with VIEs: Unearned revenues 68,088 144,124 Income and fees receivable 8,066 24,953 Investments in funds 177,092 222,192 Maximum Exposure to Loss $ 253,246 $ 391,269 |
Other Assets, Net
Other Assets, Net | 9 Months Ended |
Sep. 30, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets, Net | OTHER ASSETS, NET The following table presents the components of other assets, net as reported in the consolidated balance sheets: September 30, 2018 December 31, 2017 (dollars in thousands) Fixed Assets: Leasehold improvements $ 54,225 $ 53,419 Computer hardware and software 47,473 44,190 Furniture, fixtures and equipment 8,560 8,571 Accumulated depreciation and amortization (65,169 ) (58,671 ) Fixed assets, net 45,089 47,509 Goodwill 22,691 22,691 Prepaid expenses 6,227 12,862 Loans held for sale — 29,110 Other 5,138 4,189 Total Other Assets, Net $ 79,145 $ 116,361 |
Other Liabilities
Other Liabilities | 9 Months Ended |
Sep. 30, 2018 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | OTHER LIABILITIES The following table presents the components of other liabilities as reported in the consolidated balance sheets: September 30, 2018 December 31, 2017 (dollars in thousands) Legal provision (1) $ 28,750 $ — Accrued expenses 20,620 21,955 Uncertain tax positions 7,000 7,000 Deferred rent credit 6,844 8,283 Loan trades payable — 29,110 Other 11,867 8,774 Total Other Liabilities $ 75,081 $ 75,122 _______________ (1) Legal provision represents accruals for certain contingencies discussed in Note 16 . |
Debt Obligations
Debt Obligations | 9 Months Ended |
Sep. 30, 2018 | |
Debt Instruments [Abstract] | |
Debt Obligations | DEBT OBLIGATIONS As of September 30, 2018 , the Company’s indebtedness outstanding was primarily comprised of the 2018 Term Loan and the CLO Investments Loans (each as defined below). 2018 Term Loan and Revolving Credit Facility On April 10, 2018 (the “Closing Date”), OZ Management LP, as borrower, (the “Borrower”), and certain other subsidiaries of the Company, as guarantors, entered into a senior secured credit and guaranty agreement (the “Senior Credit Agreement”) consisting of (i) a $250.0 million term loan (the “2018 Term Loan”) and (ii) a $100.0 million revolving credit facility (the “2018 Revolving Credit Facility”). As of September 30, 2018 , $200.0 million remained outstanding under the 2018 Term Loan. The Company has not made any drawn-downs under the 2018 Revolving Credit Facility. The 2018 Term Loan matures April 10, 2023 , and the 2018 Revolving Credit Facility initially matures October 10, 2022. The maturity date of both the 2018 Term Loan and the 2018 Revolving Credit Facility may be extended pursuant to the terms of the Senior Credit Agreement. The proceeds from the 2018 Term Loan together with cash on hand were used to redeem the $400.0 million Senior Notes (as defined in the Company’s Annual Report) that were due in 2019. In connection with entry into the 2018 Senior Credit Agreement, the Company also terminated all commitments under the Company’s 2014 revolving credit facility. The 2018 Term Loan bears interest at a per annum rate equal to, at the Company’s option, one, three or six months (or twelve months with the consent of each lender) LIBOR plus 4.75% , or a base rate plus 3.75% . Borrowings under the 2018 Revolving Credit Facility bear interest at a per annum rate equal to, at the Company’s option, one, three or six month (or twelve months with the consent of each lender), LIBOR plus 1.75% to 2.75% , or a base rate plus 0.75% to 1.75% . The Company is required to pay an undrawn commitment fee at a rate per annum equal to 0.20% to 0.75% of the undrawn portion of the commitments under the 2018 Revolving Credit Facility, computed on a daily basis. The LIBOR and base rate margins under the 2018 Revolving Credit Facility, as well as the amount of the commitment fee owed by the Company under the 2018 Revolving Credit Facility, are based on the Company’s corporate rating. The obligations under the Senior Credit Agreement are guaranteed by the Oz Operating Partnerships and are secured by a lien on substantially all of the Oz Operating Partnerships’ assets, subject to certain exclusions. The Senior Credit Agreement contains two financial maintenance covenants. The first financial maintenance covenant states that the Company’s total fee-paying assets under management as of the last day of any fiscal quarter must be greater than $20.0 billion , and the second states that the total net leverage ratio (as defined in the agreement) as of the last day of any fiscal quarter must be less than (i) 3.00 to 1.00, or (ii) following the third anniversary of the Closing Date, 2.50 to 1.00. As of September 30, 2018 , the Company was in compliance with the financial maintenance covenants. The Senior Credit Agreement contains customary events of default. If an event of default under the Senior Credit Agreement occurs and is continuing, then, at the request (or with the consent) of the lenders holding a majority of the commitments and loans, upon notice by the administrative agent to the Borrower, the obligations under the Senior Credit Agreement shall become immediately due and payable. In addition, if the Borrower or any of its material subsidiaries becomes the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency or similar law, then any outstanding obligations under the Senior Credit Agreement will automatically become immediately due and payable. CLO Investments Loans The Company entered into loans to finance portions of investments in certain CLOs (collectively, the “CLO Investments Loans”). These loans are collateralized by the related investments in CLOs held by the Company. In general, the Company will make interest and principal payments on the loans at such time interest payments are received on its investments in the CLOs, and will make principal payments on the loans to the extent principal payments are received on its investments in the CLOs, with any remaining balance due upon maturity. The loans are subject to customary events of default and covenants and include terms that require the Company’s continued involvement with the CLOs. The CLO Investments Loans do not have any financial maintenance covenants and are secured by the related investments in CLOs measured at fair values of $116.5 million and $206.6 million as of September 30, 2018 and December 31, 2017 , respectively. The table below presents information related to CLO Investments Loans as of September 30, 2018 and December 31, 2017 . Carrying values presented below are net of discounts, if any, and unamortized deferred financing costs. The maturity date for each CLO Investments Loan is the earlier of the final maturity date presented in the table below or the date at which the Company no longer holds a risk retention investment in the respective CLO. As a result of a recent court decision that vacates application of U.S. risk retention rules in certain CLO transactions, the Company sold certain investments in CLOs and paid off the associated CLO Investments Loans. In the third quarter of 2018, the Company repaid one of its CLO Investments Loans and refinanced the related investment under the CLO Investments Facility described in Note 9 . Borrowing Date Contractual Rate Final Maturity Date Carrying Value September 2018 December 2017 (dollars in thousands) November 28, 2016 EURIBOR plus 2.23% December 15, 2023 $ 17,464 $ 18,041 June 7, 2017 LIBOR plus 1.48% November 16, 2029 17,219 17,217 July 21, 2017 LIBOR plus 1.43% January 22, 2029 — 21,709 August 2, 2017 LIBOR plus 1.41% January 21, 2030 21,672 21,686 August 17, 2017 LIBOR plus 1.43% April 30, 2030 — 22,922 September 14, 2017 LIBOR plus 1.41% April 22, 2030 — 25,468 September 14, 2017 EURIBOR plus 2.21% September 14, 2024 18,872 19,561 November 21, 2017 LIBOR plus 1.34% May 15, 2030 — 26,202 February 21, 2018 LIBOR plus 1.27% February 21, 2019 21,081 — $ 96,308 $ 172,806 |
Securities Sold under Agreement
Securities Sold under Agreements to Repurchase | 9 Months Ended |
Sep. 30, 2018 | |
Transfers and Servicing of Financial Assets [Abstract] | |
Securities sold under agreements to repurchase | SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE On May 29, 2018, the Company, entered into a €100.0 million master credit facility agreement (the “CLO Financing Facility”) to finance a portion of the risk retention investments in certain European CLOs managed by the Company. Subject to the terms and conditions of the CLO Financing Facility, the Company and the counterparty may enter into repurchase agreements on such terms agreed upon by the parties. Each transaction entered into under the CLO Financing Facility will bear interest at a rate based on the weighted average effective interest rate of each class of securities that have been sold plus a spread to be agreed upon by the parties (currently the spread is 0.5% ). As of September 30, 2018 , €63.2 million of the CLO Financing Facility remained available. Each transaction entered into under the CLO Financing Facility provides for payment netting and, in the case of a default or similar event with respect to the counterparty to the CLO Financing Facility, provides for netting across transactions. Generally, upon a counterparty default, the Company can terminate all transactions under the CLO Financing Facility and offset amounts it owes in respect of any one transaction against collateral it has received in respect of any other transactions under the CLO Financing Facility; provided, however, that in the case of certain defaults, the Company may only be able to terminate and offset solely with respect to the transaction affected by the default. During the term of a transaction entered into under the CLO Financing Facility, the Company will deliver cash or additional securities acceptable to the counterparty if the securities sold are in default. Upon termination of a transaction, the Company will repurchase the previously sold securities from the counterparty at a previously determined repurchase price. The CLO Financing Facility may be terminated at any time upon certain defaults or circumstances agreed upon by the parties. The repurchase agreements may result in credit exposure in the event the counterparty to the transaction is unable to fulfill its contractual obligations. The Company minimizes the credit risk associated with these activities by monitoring counterparty credit exposure and collateral values. Other than margin requirements, the Company is not subject to additional terms or contingencies which would expose the Company to additional obligations based upon the performance of the securities pledged as collateral. The table below presents securities sold under agreements to repurchase that are offset, if any, as well as securities transferred to counterparties related to such transactions (capped so that the net amount presented will not be reduced below zero). No other material financial instruments were subject to master netting agreements or other similar agreements: Securities Sold under Agreements to Repurchase Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Consolidated Balance Sheet Net Amounts of Liabilities in the Consolidated Balance Sheet Securities Transferred Net Amount (dollars in thousands) As of September 30, 2018 $ 42,378 $ — $ 42,378 $ 42,378 $ — The securities sold under agreements to repurchase have a set scheduled maturity date that corresponds to the maturities of the securities sold under such transaction. The table below presents the remaining final contractual maturity of the securities sold under agreement to repurchase by class of collateral pledged: As of September 30, 2018 Securities Sold under Agreements to Repurchase Overnight and Continuous Up to 30 Days 30-90 Days Greater Than 90 Days Total (dollars in thousands) Investments in CLOs $ — $ — $ — $ 42,378 $ 42,378 |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | REVENUES The following table presents management fees and incentive income recognized as revenues for the three and nine months ended September 30, 2018 : Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Management Fees Incentive Income Management Fees Incentive Income (dollars in thousands) Multi-strategy funds $ 41,507 $ 11,985 $ 130,307 $ 54,911 Credit Opportunistic credit funds 11,011 2,514 30,115 33,045 Institutional Credit Strategies 12,967 — 36,715 — Real estate funds 4,749 4,804 14,590 15,895 Other 441 — 1,991 942 Total $ 70,675 $ 19,303 $ 213,718 $ 104,793 A liability for unearned incentive income is generally recognized when the Company receives incentive income distributions from its funds, primarily its real estate funds, for which incentive income has not yet met the recognition threshold of being probable that a significant reversal of cumulative revenue will not occur. The following table presents the activity in the Company’s unearned incentive income for the nine months ended September 30, 2018 : Unearned Incentive Income (dollars in thousands) Balance as of December 31, 2017 $ 143,710 Effects of adoption of ASU 2014-09 (99,422 ) Amounts collected during the period 38,503 Amounts recognized during the period (14,806 ) Balance as of September 30, 2018 $ 67,985 The Company recognizes management fees over the period in which the performance obligation is satisfied. The Company records incentive income when it is probable that a significant reversal of income will not occur. The majority of management fees and incentive income receivable at each balance sheet date is generally collected during the following quarter. The following table presents the composition of the Company’s income and fees receivable as of September 30, 2018 and December 31, 2017 : September 30, 2018 December 31, 2017 (dollars in thousands) Management fees $ 23,466 $ 21,242 Incentive income 16,056 333,214 Income and Fees Receivable $ 39,522 $ 354,456 |
Equity-Based Compensation Expen
Equity-Based Compensation Expenses | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Equity-Based Compensation Expenses | EQUITY-BASED COMPENSATION EXPENSES The Company grants equity-based compensation in the form of RSUs, PSUs, Group A Units, Group P Units and Class A Shares to its executive managing directors, employees and the independent members of the Board under the terms of the 2007 Equity Incentive Plan and the 2013 Incentive Plan. The following table presents information regarding the impact of equity-based compensation grants on the Company’s consolidated statements of comprehensive income (loss): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) (dollars in thousands) Expense recorded within compensation and benefits $ 22,311 $ 22,258 $ 67,848 $ 63,696 Corresponding tax benefit $ 2,033 $ 1,800 $ 5,853 $ 5,458 The following tables present activity related to the Company’s unvested equity awards for the nine months ended September 30, 2018 : Equity-Classified Awards Liability-Classified Awards Equity-Classified Awards Unvested RSUs Weighted-Average Grant-Date Fair Value Unvested RSUs Weighted-Average Unvested PSUs Weighted-Average December 31, 2017 14,530,602 $ 4.67 — $ — — $ — Granted 38,096,061 $ 2.37 148,097 $ 1.99 10,000,000 $ 1.18 Vested (2,525,241 ) $ 4.42 — $ — — $ — Canceled or forfeited (8,624,982 ) $ 3.72 — $ — — $ — Modified from Group A Units and Group P Units 6,407,968 $ 6.36 7,345,991 $ 6.36 — $ — September 30, 2018 47,884,408 $ 3.25 7,494,088 $ 6.28 10,000,000 $ 1.18 Group A Units Group P Units Unvested Group A Units Weighted-Average Unvested Group P Units Weighted-Average December 31, 2017 8,410,663 $ 9.77 71,850,000 $ 1.25 Vested (1,574,811 ) $ 9.93 — $ — Canceled or forfeited — $ — (500,000 ) $ 1.25 Modified to RSUs (6,000,000 ) $ 9.75 (29,000,000 ) $ 1.25 September 30, 2018 835,852 $ 9.67 42,350,000 $ 1.25 Restricted Share Units (RSUs) In the three months ended March 31, 2018, a certain executive managing director forfeited 6,000,000 Group A Units and 29,000,000 Group P Units for RSUs and certain other profit-sharing interests. The forfeiture of the Partner Equity Units was accounted for as a modification to 6,407,968 equity-classified RSUs and 7,345,991 liability-classified RSUs, and other awards. The fair value of the modified awards was $6.36 per RSU and was based on the fair value of the original awards immediately before they were modified. The Company will continue to recognize at least the minimum compensation expense that would have been previously recognized prior to the modification. As of September 30, 2018 , total unrecognized compensation expense related to equity-classified awards totaled $105.6 million with a weighted-average amortization period of 2.95 years. As of September 30, 2018 , total unrecognized compensation expense related to liability-classified awards totaled $33.4 million with a weighted-average amortization period of 3.92 years. See the Company’s Annual Report for additional information regarding RSUs. The following table presents information related to the settlement of RSUs: Nine Months Ended September 30, 2018 2017 (dollars in thousands) Fair value of RSUs settled in Class A Shares $ 4,772 $ 1,213 Fair value of RSUs settled in cash $ 276 $ 130 Fair value of RSUs withheld to satisfy tax withholding obligations $ 2,419 $ 840 Number of RSUs withheld to satisfy tax withholding obligations 1,109,892 394,774 PSUs In 2018, the Company began granting PSUs. A PSU entitles the holder to receive a Class A Share, or cash equal to the fair value of a Class A Share at the election of the Board of Directors, upon completion of the requisite service period, as well as satisfying certain performance conditions based on achievement of targeted total shareholder return on Class A Shares. PSUs do not begin to accrue dividend equivalents until the requisite service period has been completed and performance conditions have been achieved. In the nine months ended September 30, 2018 , the Company granted 10,000,000 PSUs, with a weighted average grant date fair value $1.18 per unit. The fair value was determined using the Monte-Carlo simulation valuation model, with the following assumptions: volatility of 35% , dividend rate of 10% , and risk-free discount rate of 2.6% . The Company used historical volatility in its estimate of the expected volatility. As of September 30, 2018 , total unrecognized compensation expense related to these units totaled $9.3 million with a weighted-average amortization period of 2.4 years. The PSUs granted to-date vest subject to continued and uninterrupted service (“PSU Service Condition”) until the third anniversary of the grant date and the meeting of a market performance threshold of the total shareholder return on Class A Shares of the Company (“PSU Performance Condition”). The PSU Performance Condition is defined as follows: 20% of PSUs vest if a total shareholder return of 25% is achieved; an additional 40% of PSUs vest if a total shareholder return of 50% is achieved; an additional 20% of PSUs vest if a total shareholder return of 75% is achieved; and the final 20% of PSUs vest if a total shareholder return of 125% is achieved. In each case, the PSU Performance Condition must be met for each threshold by the sixth anniversary of the grant date. If the PSU grant has not satisfied both the PSU Service Condition and the PSU Performance Condition by the sixth anniversary of the grant date, it will be forfeited and canceled immediately. Group A Units As of September 30, 2018 , total unrecognized compensation expense related to these units totaled $6.1 million with a weighted-average amortization period of 1.5 years. See the Company’s Annual Report for additional information regarding the Group A Units. Group P Units As of September 30, 2018 , total unrecognized compensation expense related to the Group P Units totaled $29.5 million with a weighted-average amortization period of 2.1 years. See the Company’s Annual Report for additional information regarding the Group P Units. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The computation of the effective tax rate and provision at each interim period requires the use of certain estimates and significant judgment including, but not limited to, the expected operating income for the year, projections of the proportion of income earned and taxed in foreign jurisdictions, permanent differences, and the likelihood of recovering deferred tax assets existing as of the balance sheet date. The estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or as tax laws and regulations change. Additionally, the amount of incentive income and discretionary cash bonuses recorded in any given quarter can have a significant impact on the Company’s effective tax rate. Accordingly, the effective tax rate for interim periods is not indicative of the tax rate expected for a full year. The Registrant and each of the Oz Operating Partnerships are partnerships for U.S. federal income tax purposes. Due to the Company’s legal structure, only a portion of the income earned by the Company is subject to corporate-level tax rates in the United States and in foreign jurisdictions. The provision for income taxes includes federal, state and local taxes in the United States and foreign taxes at an approximate effective tax rate of 2.4% and 10.9% for the three months ended September 30, 2018 and 2017 , respectively, and 0.7% and 23.1% for the nine months ended September 30, 2018 and 2017 , respectively. The reconciling items from the Company’s statutory rate to the effective tax rate were driven primarily by the following: (i) a portion of the Company’s consolidated net income is not subject to federal, state and local corporate income taxes in the United States, as these amounts are allocated to the executive managing directors on their Group A Units; (ii) a portion of the income earned by the Company is subject to the New York City unincorporated business tax; and (iii) certain foreign subsidiaries are subject to foreign corporate income taxes. On December 22, 2017, the Tax Cuts and Jobs Act (“TCJA”) was signed into law. The TCJA includes a broad range of tax reforms including a reduction in the corporate income tax rate to 21% from 35% , effective January 1, 2018. The Company considers all amounts recorded as a result of the TCJA to be provisional and subject to revision. The Company’s provisional amounts, including the remeasurement of the Company’s deferred income tax assets and related tax receivable agreement liability, are based on reasonable and supportable assumptions as of September 30, 2018 . Any revisions will be treated in accordance with the measurement period guidance allowing for a period of up to one year after the enactment date of the TCJA to finalize the recording of the impact. There were no measurement period adjustments recognizes during the nine months ended September 30, 2018 . In accordance with GAAP, the Company recognizes tax benefits for amounts that are “more likely than not” to be sustained upon examination by tax authorities. For uncertain tax positions in which the benefit to be realized does not meet the “more likely than not” threshold, the Company establishes a liability, which is included within other liabilities in the consolidated balance sheets. As of September 30, 2018 and December 31, 2017 , the Company had a liability for unrecognized tax benefits of $7.0 million . As of and for the nine months ended September 30, 2018 , the Company did not accrue interest or penalties related to uncertain tax positions. As of September 30, 2018 , the Company does not believe that there will be a significant change to the uncertain tax positions during the next 12 months. The Company’s total unrecognized tax benefits that, if recognized, would affect its effective tax rate was $4.3 million as of September 30, 2018 . |
General, Administrative and Oth
General, Administrative and Other | 9 Months Ended |
Sep. 30, 2018 | |
Other Income and Expenses [Abstract] | |
General, Administrative and Other | GENERAL, ADMINISTRATIVE AND OTHER The following table presents the components of general, administrative and other expenses as reported in the consolidated statements of comprehensive income (loss): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Professional services $ 8,563 $ 9,414 $ 31,069 $ 31,170 Occupancy and equipment 7,525 7,391 21,820 25,868 Information processing and communications 5,948 6,611 19,349 20,822 Recurring placement and related service fees 3,956 4,829 12,466 15,490 Insurance 1,844 1,843 5,531 5,727 Business development 1,018 644 3,271 5,614 Foreign exchange losses and (gains) 238 (289 ) 2,825 (292 ) Other expenses 2,447 2,693 8,567 9,830 31,539 33,136 104,898 114,229 Legal provision (1) 18,750 — 31,750 — Total General, Administrative and Other $ 50,289 $ 33,136 $ 136,648 $ 114,229 _______________ (1) Legal provision represents accruals for certain contingencies discussed in Note 16 . |
(Loss) Earnings Per Class A Sha
(Loss) Earnings Per Class A Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
(Loss) Earnings Per Class A Share | (LOSS) EARNINGS PER CLASS A SHARE Basic (loss) earnings per Class A Share is computed by dividing the net (loss) income attributable to Class A Shareholders by the weighted-average number of Class A Shares outstanding for the period. For the three months ended September 30, 2018 and 2017 the Company included 1,204,603 and 1,011,588 RSUs respectively, that have vested but have not been settled in Class A Shares in the weighted-average Class A Shares outstanding used to calculate basic and diluted (loss) earnings per Class A Share. For the nine months ended September 30, 2018 and 2017 , the Company included 1,472,863 and 1,103,969 RSUs respectively, that have vested but have not been settled in Class A Shares in the weighted-average Class A Shares outstanding used to calculate basic and diluted (loss) earnings per Class A Share. The Company did not include the Group P Units or PSUs in the calculations of dilutive (loss) earnings per Class A Share, as the applicable market performance conditions have not yet been met as of September 30, 2018 . The following tables present the computation of basic and diluted earnings per Class A Share: Three Months Ended September 30, 2018 Net Loss Attributable to Class A Shareholders Weighted- Average Class A Shares Outstanding Loss Per Class A Share Number of Antidilutive Units Excluded from Diluted Calculation (dollars in thousands, except per share amounts) Basic $ (14,537 ) 192,657,766 $ (0.08 ) Effect of dilutive securities: Group A Units — — 258,978,608 RSUs — — 54,760,583 Diluted $ (14,537 ) 192,657,766 $ (0.08 ) Three Months Ended September 30, 2017 Net Income Attributable to Class A Shareholders Weighted- Average Class A Shares Outstanding Earnings Per Class A Share Number of Antidilutive Units Excluded from Diluted Calculation (dollars in thousands, except per share amounts) Basic $ 5,726 186,235,651 $ 0.03 Effect of dilutive securities: Group A Units — — 267,489,478 RSUs — — 22,538,548 Diluted $ 5,726 186,235,651 $ 0.03 Nine Months Ended September 30, 2018 Net Loss Attributable to Class A Shareholders Weighted- Average Class A Shares Outstanding Loss Per Class A Share Number of Antidilutive Units Excluded from Diluted Calculation (dollars in thousands, except per share amounts) Basic $ (23,303 ) 192,485,281 $ (0.12 ) Effect of dilutive securities: Group A Units — — 261,654,313 RSUs — — 46,200,732 Diluted $ (23,303 ) 192,485,281 $ (0.12 ) Nine Months Ended September 30, 2017 Net Income Attributable to Class A Shareholders Weighted- Average Class A Shares Outstanding Earnings Per Class A Share Number of Antidilutive Units Excluded from Diluted Calculation (dollars in thousands, except per share amounts) Basic $ 11,660 186,201,389 $ 0.06 Effect of dilutive securities: Group A Units — — 273,923,088 RSUs — — 21,733,730 Diluted $ 11,660 186,201,389 $ 0.06 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS Due from Related Parties Amounts due from related parties relate primarily to amounts due from the funds for expenses paid on their behalf. These amounts are reimbursed to the Company on an ongoing basis. Due to Related Parties Amounts due to related parties relate primarily to future payments owed to the Company’s executive managing directors under the tax receivable agreement, as discussed further in Note 16 . The Company made no payments under the tax receivable agreement in the nine months ended September 30, 2018 and 2017 . The Company earns substantially all of its management fees and incentive income from the funds, which are considered related parties as the Company manages the operations of and makes investment decisions for these funds. Management Fees and Incentive Income Earned from Related Parties and Waived Fees As of September 30, 2018 and 2017 , respectively, approximately $2.2 billion and $2.8 billion of the Company’s assets under management represented investments by the Company, its executive managing directors, employees and certain other related parties in the Company’s funds. As of September 30, 2018 and 2017 , approximately 28% and 69% , of these affiliated assets under management were not charged management fees and were not subject to an incentive income calculation. The following table presents management fees and incentive income charged on investments held by related parties before the impact of eliminations related to the consolidated funds: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Fees charged on investments held by related parties: Management fees $ 4,148 $ 2,703 $ 10,621 $ 8,037 Incentive income $ 1,795 $ 141 $ 4,249 $ 2,476 Corporate Aircraft The Company’s corporate aircraft were used for business purposes. From time to time, certain executive managing directors used the aircraft for personal use. For the three and nine months ended September 30, 2017 , the Company charged no fees and $360 thousand for personal use of the aircraft by certain executive managing directors. The Company sold its aircraft during the first half of 2017. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Tax Receivable Agreement The purchase of Group A Units from the executive managing directors and the Ziffs with the proceeds from the 2007 Offerings, and subsequent taxable exchanges by them of Partner Equity Units for Class A Shares on a one-for-one basis (or, at the Company’s option, a cash equivalent), resulted, and, in the case of future exchanges, are anticipated to result, in an increase in the tax basis of the tangible and intangible assets of the Oz Operating Group that would not otherwise have been available. As a result, the Company expects that its future tax liability will be reduced. Pursuant to the tax receivable agreement entered into among the Company, the executive managing directors and the Ziffs, the Company has agreed to pay to the executive managing directors and the Ziffs 85% of the amount of tax savings, if any, actually realized by the Company. The Company recorded its initial estimate of future payments under the tax receivable agreement as a decrease to paid-in capital and an increase in amounts due to related parties in the consolidated financial statements. Subsequent adjustments to the liability for future payments under the tax receivable agreement related to changes in estimated future tax rates or state income tax apportionment are recognized through current period earnings in the consolidated statements of comprehensive income (loss). In connection with the departure of certain former executive managing directors since the IPO, the right to receive payments under the tax receivable agreement by those former executive managing directors was contributed to the Oz Operating Group. As a result, the Company expects to pay to the remaining executive managing directors and the Ziffs approximately 78% (from 85% at the time of the IPO) of the amount of cash savings, if any, in federal, state and local income taxes in the United States that the Company actually realizes as a result of the increases in tax basis. The estimate of the timing and the amount of future payments under the tax receivable agreement involves several assumptions that do not account for the significant uncertainties associated with these potential payments, including an assumption that Oz Corp will have sufficient taxable income in the relevant tax years to utilize the tax benefits that would give rise to an obligation to make payments. The actual timing and amount of any actual payments under the tax receivable agreement will vary based upon these and a number of other factors. As of September 30, 2018 , the estimated future payment under the tax receivable agreement was $280.0 million , which is recorded in due to related parties on the consolidated balance sheets. Lease Obligations The Company has non-cancelable operating leases for its headquarters in New York expiring in 2029 and various other operating leases for its offices in London, Hong Kong, Mumbai, Beijing, Shanghai, and other locations, expiring on various dates through 2024 . The Company recognizes expense related to its operating leases on a straight-line basis over the lease term taking into account any rent holiday periods. The related lease commitments have not changed materially since December 31, 2017 . Litigation From time to time, the Company is involved in litigation and claims incidental to the conduct of the Company’s business. The Company is also subject to extensive scrutiny by regulatory agencies globally that have, or may in the future have, regulatory authority over the Company and its business activities. This has resulted, or may in the future result, in regulatory agency investigations, litigation and subpoenas and costs related to each. On May 5, 2014, a purported matter of shareholders filed a lawsuit against the Company in the U.S. District Court for the Southern District of New York ( Menaldi v. Och-Ziff Capital Mgmt., et al. ). The amended complaint asserted claims under the Securities Exchange Act of 1934 on behalf of all purchasers of Company securities from February 9, 2012 to August 22, 2014. Daniel Och, Joel Frank and Michael Cohen were also named as defendants. On March 16, 2015, all defendants moved to dismiss the amended complaint. On February 17, 2016, the court entered an order granting in part the motion to dismiss filed by the Company and Messrs. Och and Frank and dismissing Mr. Cohen from the action. On March 23, 2016, the Company and Messrs. Och and Frank filed their answer to the amended complaint. On November 18, 2016, plaintiffs filed a second amended complaint asserting claims under the Securities Exchange Act of 1934 on behalf of all purchasers of Company securities from November 18, 2011 to April 11, 2016. The second amended complaint alleges, among other things, breaches of certain disclosure obligations with respect to matters that were under investigation by the SEC and the DOJ, and names the Company and Messrs. Och, Frank and Cohen as defendants. On November 23, 2016, Mr. Cohen objected to being named as a defendant in the second amended complaint on procedural grounds. On December 21, 2016, the court directed the plaintiffs to file a motion for permission to renew their claims against Mr. Cohen. Plaintiffs filed their motion on January 7, 2017. On January 11, 2017, the Company filed a motion to dismiss those portions of the second amended complaint that seek to revive dismissed claims or assert new claims against it, and Messrs. Och and Frank filed motions to dismiss as well. On September 29, 2017, the Court granted the Company’s motion to dismiss in its entirety and dismissed plaintiffs’ revived claims and new claims against the Company and Messrs. Och and Frank. The Court also dismissed Mr. Cohen from the matter entirely and denied plaintiffs’ request to file a further amended complaint. On September 17, 2018, the parties notified the Court that they had reached an agreement in principle to settle the matter. On October 2, 2018, the parties’ stipulation of settlement was filed with the Court. Under the parties’ proposed settlement, the Company will pay $28.8 million in exchange for a full release from plaintiffs and the class members they represent. On October 3, 2018, the Court entered an order preliminarily approving the settlement. On October 5, 2018, the Court entered an order scheduling a hearing on January 16, 2019 for final approval of the settlement. The Company recorded a $10.0 million legal provision in the second quarter of 2018 in connection with the Menaldi matter and recorded an additional $18.8 million legal provision in the third quarter of 2018. The chance of any additional loss in connection with this matter is remote. In addition, in U.S. v. Oz Africa Management GP, LLC , Cr. No. 16-515 (NGG) (EDNY), certain former shareholders of a Canadian mining company filed a letter with the court stating they plan to seek restitution at the sentencing hearing for Oz Africa Management GP, LLC. The Company believes the threatened claim is without merit and intends to defend it vigorously. The Company is unable to reasonably estimate an amount, if any, of loss or range of loss possible for this matter. Investment Commitments From time to time, certain funds consolidated by the Company may have commitments to fund investments. These commitments are funded through contributions from investors in those funds, including the Company if it is an investor in the relevant fund. The Company has unfunded capital commitments of $24.2 million to certain funds it manages. It expects to fund these commitments over the next three years. In addition, certain related parties of the Company, collectively, have unfunded capital commitments to funds managed by the Company of up to $76.9 million . The Company has guaranteed these commitments in the event any executive managing director fails to fund any portion when called by the fund. The Company has historically not funded any of these commitments and does not expect to in the future, as these commitments are expected to be funded by the Company’s executive managing directors individually. Other Contingencies During the second quarter of 2018, the Company recorded a $3.0 million legal provision to resolve a commercial dispute. The Company resolved this matter in the third quarter of 2018 and will not incur any additional loss related to this matter. In the normal course of business, the Company enters into contracts that provide a variety of general indemnifications. Such contracts include those with certain service providers, brokers and trading counterparties. Any exposure to the Company under these arrangements could involve future claims that may be made against the Company. Currently, no such claims exist or are expected to arise and, accordingly, the Company has not accrued any liability in connection with such indemnifications. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION The Company’s operating segments are the Oz Funds segment and the Company’s real estate business. The Oz Funds segment, which provides asset management services to the Company’s multi-strategy funds, dedicated credit funds and other alternative investment vehicles, is currently the Company’s only reportable operating segment under GAAP. The Company’s real estate business, which provides asset management services to its real estate funds, is included in the Other Operations, as it does not meet the threshold of a reportable operating segment under GAAP. In addition to analyzing the Company’s results on a GAAP basis, management also reviews its results on an “Economic Income” basis. Economic Income excludes the adjustments described below that are required for presentation of the Company’s results on a GAAP basis, but that management does not consider when evaluating operating performance in any given period. Management uses Economic Income as the basis on which it evaluates the Company’s financial performance and makes resource allocation and other operating decisions. Management considers it important that investors review the same operating information that it uses. Economic Income is a measure of pre-tax operating performance that excludes the following from the Company’s results on a GAAP basis: • Income allocations to the Company’s executive managing directors on their direct interests in the Oz Operating Group. Management reviews operating performance at the Oz Operating Group level, where substantially all of the Company’s operations are performed, prior to making any income allocations. • Equity-based compensation expenses, depreciation and amortization expenses, changes in the tax receivable agreement liability, net losses on early retirement of debt, gains and losses on fixed assets, and gains and losses on investments in funds, as management does not consider these items to be reflective of operating performance. However, the fair value of RSUs that are settled in cash to employees or executive managing directors is included as an expense at the time of settlement. • Amounts related to the consolidated funds, including the related eliminations of management fees and incentive income, as management reviews the total amount of management fees and incentive income earned in relation to total assets under management and fund performance. In addition, expenses related to incentive income profit-sharing arrangements are generally recognized at the same time the related incentive income revenue is recognized, as management reviews the total compensation expense related to these arrangements in relation to any incentive income earned by the relevant fund. Further, deferred cash compensation is expensed in full in the year granted for Economic Income, rather than over the service period for GAAP. Finally, management reviews Economic Income revenues by presenting management fees net of recurring placement and related service fees, rather than considering these fees an expense, and by excluding the impact of eliminations related to the consolidated funds. Management does not regularly review assets by operating segment in assessing operating segment performance and the allocation of company resources; therefore, the Company does not present total assets by operating segment. Substantially all interest income and all interest expense related to indebtedness outstanding is allocated to the Oz Funds segment. Oz Funds Segment Results Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Oz Funds Segment: Economic Income Revenues $ 79,763 $ 119,390 $ 287,148 $ 380,999 Economic Income $ (7,483 ) $ 49,768 $ 49,410 $ 157,891 Reconciliation of Oz Funds Segment Revenues to Consolidated Revenues Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Total consolidated revenues $ 93,827 $ 131,999 $ 332,003 $ 420,097 Adjustment to management fees (1) (4,222 ) (4,827 ) (13,440 ) (15,488 ) Adjustment to other revenues (2) — 141 (39 ) (1,117 ) Other Operations revenues (9,335 ) (5,868 ) (29,635 ) (18,975 ) Income of consolidated funds (507 ) (2,055 ) (1,741 ) (3,518 ) Economic Income Revenues - Oz Funds Segment $ 79,763 $ 119,390 $ 287,148 $ 380,999 _______________ (1) Adjustment to present management fees net of recurring placement and related service fees, as management considers these fees a reduction in management fees, not an expense. The impact of eliminations related to the consolidated funds is also removed. (2) Adjustment to exclude realized gains on sale of fixed assets. Reconciliation of Oz Funds Segment Economic Income to Net (Loss) Income Attributable to Class A Shareholders Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Net (Loss) Income Attributable to Class A Shareholders—GAAP $ (14,537 ) $ 5,726 $ (23,303 ) $ 11,660 Change in redemption value of Preferred Units — — — 2,853 Net (Loss) Income Attributable to Och-Ziff Capital Management Group LLC—GAAP $ (14,537 ) $ 5,726 $ (23,303 ) $ 14,513 Net (loss) income attributable to Group A Units (21,798 ) 9,500 (35,343 ) 41,145 Equity-based compensation, net of RSUs settled in cash 22,311 22,128 67,572 63,566 Adjustment to recognize deferred cash compensation in the period of grant 791 (254 ) 15,548 (666 ) Income taxes (860 ) 1,942 (372 ) 17,242 Net losses on early retirement of debt — — 14,303 — Allocations to Group D Units 783 1,554 3,060 4,914 Adjustment for expenses related to compensation and profit-sharing arrangements based on fund investment performance 4,229 7,470 4,622 13,242 Depreciation, amortization and net gains and losses on fixed assets 2,543 2,237 7,709 7,693 Other adjustments 781 (314 ) 1,383 (1,511 ) Other Operations (1,726 ) (221 ) (5,769 ) (2,247 ) Economic Income - Oz Funds Segment $ (7,483 ) $ 49,768 $ 49,410 $ 157,891 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Dividend On November 2, 2018 , the Company announced a cash dividend of $0.02 per Class A Share. The dividend is payable on November 20, 2018 , to holders of record as of the close of business on November 13, 2018 . |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fair Value Disclosure | Fair Value Disclosures Fair value represents the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date (i.e., an exit price). Due to the inherent uncertainty of valuations of investments that are determined to be illiquid or do not have readily ascertainable fair values, the estimates of fair value may differ from the values ultimately realized, and those differences can be material. GAAP prioritizes the level of market price observability used in measuring assets and liabilities at fair value. Market price observability is impacted by a number of factors, including the type of assets and liabilities and the specific characteristics of the assets and liabilities. Assets and liabilities with readily available, actively quoted prices or for which fair value can be measured from actively-quoted prices generally will have a higher degree of market price observability and lesser degree of judgment used in measuring fair value. Assets and liabilities measured at fair value are classified into one of the following categories: • Level I – Fair value is determined using quoted prices that are available in active markets for identical assets or liabilities. The types of assets and liabilities that would generally be included in this category are certain listed equities, U.S. government obligations and certain listed derivatives. • Level II – Fair value is determined using quotations received from dealers making a market for these assets or liabilities (“broker quotes”), valuations obtained from independent third-party pricing services, the use of models or other valuation methodologies based on pricing inputs that are either directly or indirectly market observable as of the measurement date. The types of assets and liabilities that would generally be included in this category are certain corporate bonds, certain credit default swap contracts, certain bank debt securities, certain commercial real estate debt, less liquid equity securities, forward contracts and certain over the-counter (“OTC”) derivatives. • Level III – Fair value is determined using pricing inputs that are unobservable in the market and includes situations where there is little, if any, market activity for the asset or liability. The fair value of assets and liabilities in this category may require significant judgment or estimation in determining fair value of the assets or liabilities. The fair value of these assets and liabilities may be estimated using a combination of observed transaction prices, independent pricing services, relevant broker quotes, models or other valuation methodologies based on pricing inputs that are neither directly or indirectly market observable. The types of assets and liabilities that would generally be included in this category include CLOs, real estate investments, equity and debt securities issued by private entities, limited partnerships, certain corporate bonds, certain credit default swap contracts, certain bank debt securities, certain commercial real estate debt, certain OTC derivatives, residential and commercial mortgage-backed securities, asset-backed securities, collateralized debt obligations and investments in affiliated credit funds. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. |
Basis of Presentation | Basis of Presentation These unaudited, interim, consolidated financial statements are prepared in accordance with GAAP as set forth in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”), and should be read in conjunction with the audited consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2017 (the “Annual Report”). In the opinion of management, all adjustments considered necessary for a fair presentation of the Company’s unaudited, interim, consolidated financial statements have been included and are of a normal and recurring nature. All significant intercompany transactions and balances have been eliminated in consolidation. The results of operations presented for the interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. For example, incentive income for the majority of the Company’s multi-strategy assets under management is recognized in the fourth quarter each year, based on full year investment performance. |
Revenue Recognition, Management Fees and Incentive Income | Revenue Recognition Policies The Company provides asset management services to its customers, including certain administrative services related to the funds’ operations, in exchange for management and incentive fees, which are included in the Company’s agreements with its customers. The services provided in connection with the identified performance obligations are satisfied over time. The agreements are generally automatically renewed on an annual basis unless the agreements are terminated by the general partner or directors of the respective funds. Management Fees Management fees for the Company’s multi-strategy funds typically range from 0.98% to 2.25% annually of assets under management based on the net asset value of these funds. For the Company’s opportunistic credit funds, management fees typically range from 0.75% to 1.75% annually based on the net asset value of these funds. Management fees for Institutional Credit Strategies, which relate primarily to the Company’s CLOs, generally range from 0.35% to 0.50% annually, and for CLOs are based on the par value of the collateral and cash held in the CLOs. Management fees for the Company’s real estate funds typically range from 0.75% to 1.50% annually based on the amount of capital committed or invested during the investment period, and on the amount of invested capital after the investment period. Management fees are recognized over the period during which the related services are performed. Management fees are generally calculated and paid to the Company on a quarterly basis in advance, based on the amount of assets under management at the beginning of the quarter. Management fees are prorated for capital inflows and redemptions during the quarter. Accordingly, changes in the Company’s management fee revenues from quarter to quarter are driven by changes in the quarterly opening balances of assets under management, the relative magnitude and timing of inflows and redemptions during the respective quarter, as well as the impact of differing management fee rates charged on those inflows and redemptions. The Company considers management fees to be a form of variable consideration, as the amount earned each quarter may depend on various contingencies, such as the value of assets under management, capital inflows and outflows during the period, or changes in committed or invested capital. Management fees, however, are generally crystallized at the end of each reporting period and are not subject to clawback and, therefore, the value of the management fees the Company is entitled to receive at the end of each quarter is generally no longer subject to the constraint. Incentive Income The Company earns incentive income based on the cumulative performance of the funds over a commitment period. Prior to the adoption of new revenue recognition accounting guidance in 2018, incentive income was recognized at the end of the applicable commitment period when the amounts were contractually payable, or “crystallized,” and when no longer subject to clawback. Beginning in 2018, as a result of the adoption of the new revenue recognition accounting guidance, the Company recognizes incentive income when such amounts are probable of not significantly reversing. Incentive income is typically equal to 20% of the realized and unrealized profits, net of management fees, attributable to each fund investor in the Company’s multi-strategy funds, open-end opportunistic credit funds and certain other funds. Incentive income excludes unrealized gains and losses attributable to investments that the Company, as investment manager, believes lack a readily ascertainable market value, are illiquid or should be held until the resolution of a special event or circumstance (“Special Investments”). For the Company’s closed-end opportunistic credit funds, real estate funds and certain other funds, incentive income is typically equal to 20% of the realized profits, net of management fees, attributable to each fund investor. For CLOs, incentive income is typically 20% of the excess cash flows available to the holders of the subordinated notes. The Company’s ability to earn incentive income from some of its funds may be impacted by hurdle rates, whereby the Company is not entitled to incentive income until the investment returns exceed an agreed upon benchmark. For a portion of these assets subject to hurdle rates, once the investment performance has exceeded the hurdle rate, the Company may receive a preferential “catch-up” allocation, equal to a full 20% of the net profits attributable to investors in these assets. All of the Company’s multi-strategy funds and open-end opportunistic credit funds are subject to a perpetual loss carry forward, or perpetual “high-water mark,” meaning the Company will not be able to earn incentive income with respect to positive investment performance it generates for a fund investor in any year following negative investment performance until that loss is recouped, at which point a fund investor’s investment surpasses the high-water mark. The Company earns incentive income on any profits, net of management fees, in excess of the high-water mark. The commitment period for most of the Company’s multi-strategy assets under management is for a period of one year on a calendar-year basis with income recognized annually, and therefore it generally crystallizes incentive income annually on December 31. The Company may also recognize incentive income related to fund investor redemptions at other times during the year, as well as on assets under management subject to commitment periods that are longer than one year. The Company may also recognize incentive income for tax distributions related to these assets. Such distributions are amounts distributed to the Company to cover tax liabilities related to incentive income that has been accrued at the fund level but would otherwise not be recognized by the Company until it is probable that a significant reversal will not occur. These distributions are not subject to clawback once distributed to the Company. Incentive income is considered variable consideration, the recognition of which is subject to constraint. Incentive income is no longer constrained when it is probable that a significant reversal will not occur. Determining the amount of incentive income to record is subject to qualitative and quantitative factors including, where a fund is in its life-cycle, whether the Company has received or is entitled to receive incentive income distributions and potential sales of fund investments. The Company continuously evaluates whether there are additional considerations that could potentially impact the recognition of incentive income. To the extent that distributions have been received, but for which the recognition of incentive income is not appropriate, the Company will recognize a liability for unearned incentive income. See Note 10 for additional information regarding the Company’s revenues. |
Other Revenues | Other Revenues Other revenues consist primarily of interest income on investments in CLOs and cash and cash equivalents. Interest income is recognized on an effective yield basis. Additionally, prior to the sale of the Company’s aircraft in the first half of 2017, revenue related to non-business use of the corporate aircraft by certain executive managing directors was also included within other revenues. Revenue earned from non-business use of the corporate aircraft was recognized on an accrual basis based on actual flight hours. |
Repurchase and Resale Agreements Policy | Securities Sold Under Agreements to Repurchase Securities sold under agreements to repurchase (“repurchase agreements”) are accounted for as collateralized financing transactions. The Company provides securities to counterparties to collateralize amounts borrowed under repurchase agreements on terms that permit the counterparties to repledge or resell the securities to others. Cash borrowed is included within securities sold under agreements to repurchase in the consolidated balance sheets. Securities transferred to counterparties under repurchase agreements are included within investments in the consolidated balance sheets. Interest expense incurred on these transactions is included within interest expenses in the consolidated statements of comprehensive income (loss). See Note 9 for additional information. |
New Accounting Pronouncements | Recently Adopted Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition , and most industry-specific revenue recognition guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted ASU 2014-09 using a modified retrospective application approach as of the beginning of the first quarter of 2018 to all contracts within the scope of the standard as of the date of adoption. As a result of the adoption of ASU 2014-09, the Company now recognizes certain incentive income earlier than as prescribed under guidance in effect for fiscal year 2017, as the threshold for recognition of incentive income under ASU 2014-09 is lower than under the previous standard. The Company recognized an opening adjustment to shareholders’ equity of $117.0 million , which is net of $11.3 million of income tax, of which $41.9 million was attributable to Class A shareholders. The following table details the post-tax impact on the Company’s opening shareholders’ equity, by fund type, upon the adoption of ASU 2014-09: (dollars in thousands) Multi-strategy funds $ 2,727 Opportunistic credit funds 24,462 Real estate funds 89,795 Total $ 116,984 The adoption of this guidance resulted in a decrease to the liability for unearned incentive income of $99.4 million and an increase in income and fees receivable of $28.8 million . In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The Company elected to early adopt the standard in the third quarter of 2018. The impacts of adoption are reflected in certain disclosures in Note 4 and include removing disclosures related to: the amount of and reasons for transfers between Levels I and II of the fair value hierarchy, the policy for timing of transfers between levels, and the valuation processes for Level III fair value measurements. The adoption of the standard did not have a material effect on the Company’s consolidated financial statements. None of the other changes to GAAP that went into effect in the nine months ended September 30, 2018 had a material effect on the Company’s consolidated financial statements. Future Adoption of Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases. ASU 2016-02 requires that, for leases longer than one year, a lessee recognize in the consolidated balance sheets a right of use asset, representing the right to use the underlying asset for the lease term, and a lease liability, representing the requirement to make lease payments. The recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from existing guidance. The requirements of ASU 2016-02 are effective for the Company beginning in the first quarter of 2019. The Company expects its total assets and total liabilities in its consolidated balance sheets to increase upon adoption as a result of recording a lease asset and lease liability related to the Company’s operating leases. The Company is continuing to evaluate the impact that this guidance will have on its consolidated financial statements. See Note 15 of the Company’s Annual Report for details related to the Company’s existing operating lease obligations. None of the other changes to GAAP that are not yet effective are expected to have a material effect on the Company’s consolidated financial statements. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Impact of Adoption of ASU 2014-09 | The following table details the post-tax impact on the Company’s opening shareholders’ equity, by fund type, upon the adoption of ASU 2014-09: (dollars in thousands) Multi-strategy funds $ 2,727 Opportunistic credit funds 24,462 Real estate funds 89,795 Total $ 116,984 |
Noncontrolling Interests (Table
Noncontrolling Interests (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Noncontrolling Interest [Abstract] | |
Components of Net (Loss) Income Attributable to Noncontrolling Interests | The following table presents the components of the net (loss) income attributable to noncontrolling interests: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Group A Units $ (21,798 ) $ 9,500 $ (35,343 ) $ 41,145 Other 658 260 1,398 535 $ (21,140 ) $ 9,760 $ (33,945 ) $ 41,680 |
Components of Shareholders' Equity Attributable to Noncontrolling Interests | The following table presents the components of the shareholders’ equity attributable to noncontrolling interests: September 30, 2018 December 31, 2017 (dollars in thousands) Group A Units $ 400,822 $ 353,791 Other 5,052 4,111 $ 405,874 $ 357,902 |
Redeemable Noncontrolling Interests Roll Forward | The Preferred Units and fund investors’ interests in certain consolidated funds are redeemable outside of the Company’s control. These interests are classified within redeemable noncontrolling interests in the consolidated balance sheets. The following tables present the activity in redeemable noncontrolling interests: Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Consolidated Funds Preferred Units Total Consolidated Funds Preferred Units Total (dollars in thousands) Beginning balance $ 53,507 $ 420,000 $ 473,507 $ 25,617 $ 420,000 $ 445,617 Capital contributions 111,887 — 111,887 149,172 — 149,172 Capital distributions (562 ) — (562 ) (10,910 ) — (10,910 ) Comprehensive income 374 — 374 1,327 — 1,327 Ending Balance $ 165,206 $ 420,000 $ 585,206 $ 165,206 $ 420,000 $ 585,206 Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Consolidated Funds Preferred Units Total Consolidated Funds Preferred Units Total (dollars in thousands) Beginning balance $ 24,678 $ 420,000 $ 444,678 $ 21,621 $ 262,500 $ 284,121 Change in redemption value of Preferred Units — — — — 7,446 7,446 Preferred Units issuance, net of issuance costs — — — — 150,054 150,054 Capital contributions 32 — 32 2,283 — 2,283 Comprehensive income 432 — 432 1,238 — 1,238 Ending Balance $ 25,142 $ 420,000 $ 445,142 $ 25,142 $ 420,000 $ 445,142 |
Investments and Fair Value Di_2
Investments and Fair Value Disclosures (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Investments Summary | The following table presents the components of the Company’s investments as reported in the consolidated balance sheets: September 30, 2018 December 31, 2017 (dollars in thousands) United States government obligations, at fair value $ 287,164 $ 12,973 CLOs, at fair value 165,795 211,749 Other funds and joint ventures, equity method 32,251 14,252 Total Investments $ 485,210 $ 238,974 |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table summarizes the Company’s investments measured at fair value on a recurring basis within the fair value hierarchy as of September 30, 2018 : As of September 30, 2018 Level I Level II Level III Total (dollars in thousands) Assets, at Fair Value Included within cash and cash equivalents: United States government obligations $ 79,994 $ — $ — $ 79,994 Included within investments: United States government obligations $ 287,164 $ — $ — $ 287,164 CLOs (1) $ — $ — $ 165,795 $ 165,795 Investments of consolidated funds: Bank debt $ — $ 120,468 $ 61,598 $ 182,066 Corporate bonds — 1,828 — 1,828 Total Investments of Consolidated Funds $ — $ 122,296 $ 61,598 $ 183,894 _______________ (1) As of September 30, 2018 , investments in CLOs had contractual principal amounts of $153.2 million outstanding, which excludes the Company’s investments in subordinated tranches of the notes, as these do not have contractual principal payments. The following table summarizes the Company’s investments measured at fair value on a recurring basis within the fair value hierarchy as of December 31, 2017 : As of December 31, 2017 Level I Level II Level III Total (dollars in thousands) Assets, at Fair Value Included within cash and cash equivalents: United States government obligations $ 99,704 $ — $ — $ 99,704 Included within investments: United States government obligations $ 12,973 $ — $ — $ 12,973 CLOs (1) $ — $ — $ 211,749 $ 211,749 Investments of consolidated funds: Bank debt $ — $ 24,559 $ 18,807 $ 43,366 _______________ (1) As of December 31, 2017 , investments in CLOs had contractual principal amounts of $189.2 million outstanding, which excludes the Company’s investments in subordinated tranches of the notes, as these do not have contractual principal payments. |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following table summarizes the changes in the Company’s Level III investments for the three months ended September 30, 2018 : June 30, 2018 Transfers Transfers Investment Investment Gains / Losses September 30, 2018 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ 148,127 $ — $ — $ 24,655 $ (5,483 ) $ (1,504 ) $ 165,795 Investments of consolidated funds: Bank debt $ 32,515 $ 6,094 $ (13,795 ) $ 55,761 $ (19,356 ) $ 379 $ 61,598 The following table summarizes the changes in the Company’s Level III investments for the three months ended September 30, 2017 : June 30, 2017 Transfers Transfers Investment Investment Gains / Losses September 30, 2017 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ 43,723 $ — $ — $ 132,685 $ — $ 395 $ 176,803 Investments of consolidated funds: Bank debt $ 39,338 $ 8,840 $ (21,900 ) $ 30,470 $ (33,975 ) $ 564 $ 23,337 The following tables summarize the changes in the Company’s Level III assets and liabilities for the nine months ended September 30, 2018 : December 31, 2017 Transfers Transfers Investment Investment Gains / Losses September 30, 2018 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ 211,749 $ — $ — $ 131,104 $ (170,403 ) $ (6,655 ) $ 165,795 Investments of consolidated funds: Bank debt $ 18,807 $ 2,438 $ (1,690 ) $ 114,154 $ (72,838 ) $ 727 $ 61,598 The following tables summarize the changes in the Company’s Level III assets and liabilities for the nine months ended September 30, 2017 : December 31, 2016 Transfers Transfers Investment Investment Gains / Losses September 30, 2017 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ 21,341 $ — $ — $ 152,885 $ — $ 2,577 $ 176,803 Investments of consolidated funds: Bank debt $ 18,127 $ 767 $ (17,311 ) $ 87,611 $ (67,082 ) $ 1,225 $ 23,337 In the second quarter of 2017, the Company consolidated a CLO, the amounts related to the initial consolidation of the CLO are reflected in the investment purchases in the table above. The Company deconsolidated the CLO in the third quarter of 2017, amounts related to the deconsolidation of the CLO are included within investment sales. |
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings | The table below summarizes the net change in unrealized gains and losses on the Company’s Level III investments held as of the reporting date: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Assets, at Fair Value Included within investments: CLOs $ (1,576 ) $ 178 $ (4,944 ) $ 2,360 Investments of consolidated funds: Bank debt $ 240 $ 61 $ 274 $ 142 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | The table below presents the assets and liabilities of VIEs consolidated by the Company: September 30, 2018 December 31, 2017 (dollars in thousands) Assets Assets of consolidated funds: Investments of consolidated funds, at fair value $ 183,894 $ 43,366 Other assets of consolidated funds 39,302 13,331 Total Assets $ 223,196 $ 56,697 Liabilities Liabilities of consolidated funds: Other liabilities of consolidated funds 37,134 11,340 Total Liabilities $ 37,134 $ 11,340 The assets presented in the table above belong to the investors in those funds, are available for use only by the fund to which they belong, and are not available for use by the Company. The consolidated funds have no recourse to the general credit of the Company with respect to any liability. The Company’s direct involvement with funds that are VIEs and not consolidated by the Company is generally limited to providing asset management services and, in certain cases, insignificant direct investments in the VIEs. The maximum exposure to loss represents the potential loss of current investments or income and fees receivables from these entities, as well as the obligation to repay unearned revenues, primarily incentive income subject to clawback, in the event of any future fund losses. The Company has commitments to certain funds that are VIEs as discussed in Note 16 . The Company does not provide, nor is it required to provide, any type of non-contractual financial or other support to its VIEs that are not consolidated. The table below presents the net assets of VIEs in which the Company has variable interests along with the maximum risk of loss as a result of the Company’s involvement with VIEs: September 30, 2018 December 31, 2017 (dollars in thousands) Net assets of unconsolidated VIEs in which the Company has a variable interest $ 10,093,690 $ 8,300,163 Maximum risk of loss as a result of the Company’s involvement with VIEs: Unearned revenues 68,088 144,124 Income and fees receivable 8,066 24,953 Investments in funds 177,092 222,192 Maximum Exposure to Loss $ 253,246 $ 391,269 |
Other Assets, Net (Tables)
Other Assets, Net (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Components of Other Assets | The following table presents the components of other assets, net as reported in the consolidated balance sheets: September 30, 2018 December 31, 2017 (dollars in thousands) Fixed Assets: Leasehold improvements $ 54,225 $ 53,419 Computer hardware and software 47,473 44,190 Furniture, fixtures and equipment 8,560 8,571 Accumulated depreciation and amortization (65,169 ) (58,671 ) Fixed assets, net 45,089 47,509 Goodwill 22,691 22,691 Prepaid expenses 6,227 12,862 Loans held for sale — 29,110 Other 5,138 4,189 Total Other Assets, Net $ 79,145 $ 116,361 |
Other Liabilities (Tables)
Other Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Other Liabilities Disclosure [Abstract] | |
Components of Other Liabilities | The following table presents the components of other liabilities as reported in the consolidated balance sheets: September 30, 2018 December 31, 2017 (dollars in thousands) Legal provision (1) $ 28,750 $ — Accrued expenses 20,620 21,955 Uncertain tax positions 7,000 7,000 Deferred rent credit 6,844 8,283 Loan trades payable — 29,110 Other 11,867 8,774 Total Other Liabilities $ 75,081 $ 75,122 _______________ (1) Legal provision represents accruals for certain contingencies discussed in Note 16 . |
Debt Obligations (Tables)
Debt Obligations (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Instruments [Abstract] | |
CLO Investments Loans Table | The table below presents information related to CLO Investments Loans as of September 30, 2018 and December 31, 2017 . Carrying values presented below are net of discounts, if any, and unamortized deferred financing costs. The maturity date for each CLO Investments Loan is the earlier of the final maturity date presented in the table below or the date at which the Company no longer holds a risk retention investment in the respective CLO. As a result of a recent court decision that vacates application of U.S. risk retention rules in certain CLO transactions, the Company sold certain investments in CLOs and paid off the associated CLO Investments Loans. In the third quarter of 2018, the Company repaid one of its CLO Investments Loans and refinanced the related investment under the CLO Investments Facility described in Note 9 . Borrowing Date Contractual Rate Final Maturity Date Carrying Value September 2018 December 2017 (dollars in thousands) November 28, 2016 EURIBOR plus 2.23% December 15, 2023 $ 17,464 $ 18,041 June 7, 2017 LIBOR plus 1.48% November 16, 2029 17,219 17,217 July 21, 2017 LIBOR plus 1.43% January 22, 2029 — 21,709 August 2, 2017 LIBOR plus 1.41% January 21, 2030 21,672 21,686 August 17, 2017 LIBOR plus 1.43% April 30, 2030 — 22,922 September 14, 2017 LIBOR plus 1.41% April 22, 2030 — 25,468 September 14, 2017 EURIBOR plus 2.21% September 14, 2024 18,872 19,561 November 21, 2017 LIBOR plus 1.34% May 15, 2030 — 26,202 February 21, 2018 LIBOR plus 1.27% February 21, 2019 21,081 — $ 96,308 $ 172,806 |
Securities Sold under Agreeme_2
Securities Sold under Agreements to Repurchase (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Transfers and Servicing of Financial Assets [Abstract] | |
Schedule of Repurchase Agreements Offsetting Disclosures | The table below presents securities sold under agreements to repurchase that are offset, if any, as well as securities transferred to counterparties related to such transactions (capped so that the net amount presented will not be reduced below zero). No other material financial instruments were subject to master netting agreements or other similar agreements: Securities Sold under Agreements to Repurchase Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Consolidated Balance Sheet Net Amounts of Liabilities in the Consolidated Balance Sheet Securities Transferred Net Amount (dollars in thousands) As of September 30, 2018 $ 42,378 $ — $ 42,378 $ 42,378 $ — |
Schedule of Remaining Contractual Maturity of Repurchase Agreements | The securities sold under agreements to repurchase have a set scheduled maturity date that corresponds to the maturities of the securities sold under such transaction. The table below presents the remaining final contractual maturity of the securities sold under agreement to repurchase by class of collateral pledged: As of September 30, 2018 Securities Sold under Agreements to Repurchase Overnight and Continuous Up to 30 Days 30-90 Days Greater Than 90 Days Total (dollars in thousands) Investments in CLOs $ — $ — $ — $ 42,378 $ 42,378 |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Management Fees and Incentive Income Recognized | The following table presents management fees and incentive income recognized as revenues for the three and nine months ended September 30, 2018 : Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Management Fees Incentive Income Management Fees Incentive Income (dollars in thousands) Multi-strategy funds $ 41,507 $ 11,985 $ 130,307 $ 54,911 Credit Opportunistic credit funds 11,011 2,514 30,115 33,045 Institutional Credit Strategies 12,967 — 36,715 — Real estate funds 4,749 4,804 14,590 15,895 Other 441 — 1,991 942 Total $ 70,675 $ 19,303 $ 213,718 $ 104,793 |
Unearned Incentive Income Roll Forward | A liability for unearned incentive income is generally recognized when the Company receives incentive income distributions from its funds, primarily its real estate funds, for which incentive income has not yet met the recognition threshold of being probable that a significant reversal of cumulative revenue will not occur. The following table presents the activity in the Company’s unearned incentive income for the nine months ended September 30, 2018 : Unearned Incentive Income (dollars in thousands) Balance as of December 31, 2017 $ 143,710 Effects of adoption of ASU 2014-09 (99,422 ) Amounts collected during the period 38,503 Amounts recognized during the period (14,806 ) Balance as of September 30, 2018 $ 67,985 |
Income and Fees Receivable | The following table presents the composition of the Company’s income and fees receivable as of September 30, 2018 and December 31, 2017 : September 30, 2018 December 31, 2017 (dollars in thousands) Management fees $ 23,466 $ 21,242 Incentive income 16,056 333,214 Income and Fees Receivable $ 39,522 $ 354,456 |
Equity-Based Compensation Exp_2
Equity-Based Compensation Expenses (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Equity-Based Compensation Expense | The following table presents information regarding the impact of equity-based compensation grants on the Company’s consolidated statements of comprehensive income (loss): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) (dollars in thousands) Expense recorded within compensation and benefits $ 22,311 $ 22,258 $ 67,848 $ 63,696 Corresponding tax benefit $ 2,033 $ 1,800 $ 5,853 $ 5,458 |
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award | The following tables present activity related to the Company’s unvested equity awards for the nine months ended September 30, 2018 : Equity-Classified Awards Liability-Classified Awards Equity-Classified Awards Unvested RSUs Weighted-Average Grant-Date Fair Value Unvested RSUs Weighted-Average Unvested PSUs Weighted-Average December 31, 2017 14,530,602 $ 4.67 — $ — — $ — Granted 38,096,061 $ 2.37 148,097 $ 1.99 10,000,000 $ 1.18 Vested (2,525,241 ) $ 4.42 — $ — — $ — Canceled or forfeited (8,624,982 ) $ 3.72 — $ — — $ — Modified from Group A Units and Group P Units 6,407,968 $ 6.36 7,345,991 $ 6.36 — $ — September 30, 2018 47,884,408 $ 3.25 7,494,088 $ 6.28 10,000,000 $ 1.18 Group A Units Group P Units Unvested Group A Units Weighted-Average Unvested Group P Units Weighted-Average December 31, 2017 8,410,663 $ 9.77 71,850,000 $ 1.25 Vested (1,574,811 ) $ 9.93 — $ — Canceled or forfeited — $ — (500,000 ) $ 1.25 Modified to RSUs (6,000,000 ) $ 9.75 (29,000,000 ) $ 1.25 September 30, 2018 835,852 $ 9.67 42,350,000 $ 1.25 |
Settlement of Restricted Share Units | The following table presents information related to the settlement of RSUs: Nine Months Ended September 30, 2018 2017 (dollars in thousands) Fair value of RSUs settled in Class A Shares $ 4,772 $ 1,213 Fair value of RSUs settled in cash $ 276 $ 130 Fair value of RSUs withheld to satisfy tax withholding obligations $ 2,419 $ 840 Number of RSUs withheld to satisfy tax withholding obligations 1,109,892 394,774 |
General, Administrative and O_2
General, Administrative and Other (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Other Income and Expenses [Abstract] | |
Components of General, Administrative and Other Expenses | The following table presents the components of general, administrative and other expenses as reported in the consolidated statements of comprehensive income (loss): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Professional services $ 8,563 $ 9,414 $ 31,069 $ 31,170 Occupancy and equipment 7,525 7,391 21,820 25,868 Information processing and communications 5,948 6,611 19,349 20,822 Recurring placement and related service fees 3,956 4,829 12,466 15,490 Insurance 1,844 1,843 5,531 5,727 Business development 1,018 644 3,271 5,614 Foreign exchange losses and (gains) 238 (289 ) 2,825 (292 ) Other expenses 2,447 2,693 8,567 9,830 31,539 33,136 104,898 114,229 Legal provision (1) 18,750 — 31,750 — Total General, Administrative and Other $ 50,289 $ 33,136 $ 136,648 $ 114,229 _______________ (1) Legal provision represents accruals for certain contingencies discussed in Note 16 . |
(Loss) Earnings Per Class A S_2
(Loss) Earnings Per Class A Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted (Loss) Earnings Per Class A Share | The following tables present the computation of basic and diluted earnings per Class A Share: Three Months Ended September 30, 2018 Net Loss Attributable to Class A Shareholders Weighted- Average Class A Shares Outstanding Loss Per Class A Share Number of Antidilutive Units Excluded from Diluted Calculation (dollars in thousands, except per share amounts) Basic $ (14,537 ) 192,657,766 $ (0.08 ) Effect of dilutive securities: Group A Units — — 258,978,608 RSUs — — 54,760,583 Diluted $ (14,537 ) 192,657,766 $ (0.08 ) Three Months Ended September 30, 2017 Net Income Attributable to Class A Shareholders Weighted- Average Class A Shares Outstanding Earnings Per Class A Share Number of Antidilutive Units Excluded from Diluted Calculation (dollars in thousands, except per share amounts) Basic $ 5,726 186,235,651 $ 0.03 Effect of dilutive securities: Group A Units — — 267,489,478 RSUs — — 22,538,548 Diluted $ 5,726 186,235,651 $ 0.03 Nine Months Ended September 30, 2018 Net Loss Attributable to Class A Shareholders Weighted- Average Class A Shares Outstanding Loss Per Class A Share Number of Antidilutive Units Excluded from Diluted Calculation (dollars in thousands, except per share amounts) Basic $ (23,303 ) 192,485,281 $ (0.12 ) Effect of dilutive securities: Group A Units — — 261,654,313 RSUs — — 46,200,732 Diluted $ (23,303 ) 192,485,281 $ (0.12 ) Nine Months Ended September 30, 2017 Net Income Attributable to Class A Shareholders Weighted- Average Class A Shares Outstanding Earnings Per Class A Share Number of Antidilutive Units Excluded from Diluted Calculation (dollars in thousands, except per share amounts) Basic $ 11,660 186,201,389 $ 0.06 Effect of dilutive securities: Group A Units — — 273,923,088 RSUs — — 21,733,730 Diluted $ 11,660 186,201,389 $ 0.06 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Management Fees and Incentive Income Earned from Related Parties | The following table presents management fees and incentive income charged on investments held by related parties before the impact of eliminations related to the consolidated funds: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Fees charged on investments held by related parties: Management fees $ 4,148 $ 2,703 $ 10,621 $ 8,037 Incentive income $ 1,795 $ 141 $ 4,249 $ 2,476 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Oz Funds Segment Results | Oz Funds Segment Results Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Oz Funds Segment: Economic Income Revenues $ 79,763 $ 119,390 $ 287,148 $ 380,999 Economic Income $ (7,483 ) $ 49,768 $ 49,410 $ 157,891 |
Reconciliation of Oz Funds Segment Revenues to Consolidated Revenues | Reconciliation of Oz Funds Segment Revenues to Consolidated Revenues Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Total consolidated revenues $ 93,827 $ 131,999 $ 332,003 $ 420,097 Adjustment to management fees (1) (4,222 ) (4,827 ) (13,440 ) (15,488 ) Adjustment to other revenues (2) — 141 (39 ) (1,117 ) Other Operations revenues (9,335 ) (5,868 ) (29,635 ) (18,975 ) Income of consolidated funds (507 ) (2,055 ) (1,741 ) (3,518 ) Economic Income Revenues - Oz Funds Segment $ 79,763 $ 119,390 $ 287,148 $ 380,999 _______________ (1) Adjustment to present management fees net of recurring placement and related service fees, as management considers these fees a reduction in management fees, not an expense. The impact of eliminations related to the consolidated funds is also removed. (2) Adjustment to exclude realized gains on sale of fixed assets. |
Reconciliation of Oz Funds Economic Income to Net (Loss) Income Attributable to Class A Shareholders | Reconciliation of Oz Funds Segment Economic Income to Net (Loss) Income Attributable to Class A Shareholders Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (dollars in thousands) Net (Loss) Income Attributable to Class A Shareholders—GAAP $ (14,537 ) $ 5,726 $ (23,303 ) $ 11,660 Change in redemption value of Preferred Units — — — 2,853 Net (Loss) Income Attributable to Och-Ziff Capital Management Group LLC—GAAP $ (14,537 ) $ 5,726 $ (23,303 ) $ 14,513 Net (loss) income attributable to Group A Units (21,798 ) 9,500 (35,343 ) 41,145 Equity-based compensation, net of RSUs settled in cash 22,311 22,128 67,572 63,566 Adjustment to recognize deferred cash compensation in the period of grant 791 (254 ) 15,548 (666 ) Income taxes (860 ) 1,942 (372 ) 17,242 Net losses on early retirement of debt — — 14,303 — Allocations to Group D Units 783 1,554 3,060 4,914 Adjustment for expenses related to compensation and profit-sharing arrangements based on fund investment performance 4,229 7,470 4,622 13,242 Depreciation, amortization and net gains and losses on fixed assets 2,543 2,237 7,709 7,693 Other adjustments 781 (314 ) 1,383 (1,511 ) Other Operations (1,726 ) (221 ) (5,769 ) (2,247 ) Economic Income - Oz Funds Segment $ (7,483 ) $ 49,768 $ 49,410 $ 157,891 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Effects of Adoption of the Revenue Standard (Details) $ in Thousands | Dec. 31, 2017USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Impact of Adoption of ASU 2014-09 | $ 116,984 |
Accounting Standards Update 2014-09 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Impact of Adoption of ASU 2014-09 | 116,984 |
Accounting Standards Update 2014-09 | Multi-strategy funds | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Impact of Adoption of ASU 2014-09 | 2,727 |
Accounting Standards Update 2014-09 | Opportunistic credit funds | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Impact of Adoption of ASU 2014-09 | 24,462 |
Accounting Standards Update 2014-09 | Real estate funds | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Impact of Adoption of ASU 2014-09 | $ 89,795 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Sep. 30, 2018 |
Summary of Significant Accounting Policies [Line Items] | ||
Impact of Adoption of ASU 2014-09 on Opening Equity | $ 116,984 | |
Impact of Adoption of ASU 2014-09 on Unearned Incentive Income | (99,422) | |
Class A Shareholders' | ||
Summary of Significant Accounting Policies [Line Items] | ||
Impact of Adoption of ASU 2014-09 on Opening Equity | 41,922 | |
Multi-strategy funds | Minimum | ||
Summary of Significant Accounting Policies [Line Items] | ||
Management Fee Rates | 0.98% | |
Multi-strategy funds | Maximum | ||
Summary of Significant Accounting Policies [Line Items] | ||
Management Fee Rates | 2.25% | |
Opportunistic credit funds | Minimum | ||
Summary of Significant Accounting Policies [Line Items] | ||
Management Fee Rates | 0.75% | |
Opportunistic credit funds | Maximum | ||
Summary of Significant Accounting Policies [Line Items] | ||
Management Fee Rates | 1.75% | |
CLOs | ||
Summary of Significant Accounting Policies [Line Items] | ||
Incentive Income Rate | 20.00% | |
CLOs | Minimum | ||
Summary of Significant Accounting Policies [Line Items] | ||
Management Fee Rates | 0.35% | |
CLOs | Maximum | ||
Summary of Significant Accounting Policies [Line Items] | ||
Management Fee Rates | 0.50% | |
Real estate funds | Minimum | ||
Summary of Significant Accounting Policies [Line Items] | ||
Management Fee Rates | 0.75% | |
Real estate funds | Maximum | ||
Summary of Significant Accounting Policies [Line Items] | ||
Management Fee Rates | 1.50% | |
Multi-strategy and open-end credit funds | ||
Summary of Significant Accounting Policies [Line Items] | ||
Incentive Income Rate | 20.00% | |
Closed-end opportunistic credit and real estate funds | ||
Summary of Significant Accounting Policies [Line Items] | ||
Incentive Income Rate | 20.00% | |
Accounting Standards Update 2014-09 | ||
Summary of Significant Accounting Policies [Line Items] | ||
Impact of Adoption of ASU 2014-09 on Opening Equity | 116,984 | |
Impact of Adoption of ASU 2014-09 on Income Tax Effects Allocated to Equity | 11,300 | |
Impact of Adoption of ASU 2014-09 on Unearned Incentive Income | (99,400) | |
Impact of Adoption of ASU 2014-09 on Incentive Receivable | 28,800 | |
Accounting Standards Update 2014-09 | Class A Shareholders' | ||
Summary of Significant Accounting Policies [Line Items] | ||
Impact of Adoption of ASU 2014-09 on Opening Equity | 41,900 | |
Accounting Standards Update 2014-09 | Multi-strategy funds | ||
Summary of Significant Accounting Policies [Line Items] | ||
Impact of Adoption of ASU 2014-09 on Opening Equity | 2,727 | |
Accounting Standards Update 2014-09 | Opportunistic credit funds | ||
Summary of Significant Accounting Policies [Line Items] | ||
Impact of Adoption of ASU 2014-09 on Opening Equity | 24,462 | |
Accounting Standards Update 2014-09 | Real estate funds | ||
Summary of Significant Accounting Policies [Line Items] | ||
Impact of Adoption of ASU 2014-09 on Opening Equity | $ 89,795 |
Noncontrolling Interests - Com
Noncontrolling Interests - Components of Net (Loss) Income Attributable to Noncontrolling Interests (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Noncontrolling Interest [Line Items] | ||||
Net (Loss) Income Attributable to Noncontrolling Interests | $ (21,140) | $ 9,760 | $ (33,945) | $ 41,680 |
Group A Units | ||||
Noncontrolling Interest [Line Items] | ||||
Net (Loss) Income Attributable to Noncontrolling Interests | (21,798) | 9,500 | (35,343) | 41,145 |
Other | ||||
Noncontrolling Interest [Line Items] | ||||
Net (Loss) Income Attributable to Noncontrolling Interests | $ 658 | $ 260 | $ 1,398 | $ 535 |
Noncontrolling Interests - C_2
Noncontrolling Interests - Components of Shareholders' Equity Attributable to Noncontrolling Interests (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Noncontrolling Interest [Line Items] | ||
Shareholders’ equity attributable to noncontrolling interests | $ 405,874 | $ 357,902 |
Group A Units | ||
Noncontrolling Interest [Line Items] | ||
Shareholders’ equity attributable to noncontrolling interests | 400,822 | 353,791 |
Other | ||
Noncontrolling Interest [Line Items] | ||
Shareholders’ equity attributable to noncontrolling interests | $ 5,052 | $ 4,111 |
Noncontrolling Interests - Red
Noncontrolling Interests - Redeemable Noncontrolling Interest (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Increase (Decrease) in Redeemable Noncontrolling Interest [Roll Forward] | ||||
Beginning balance | $ 473,507 | $ 444,678 | $ 445,617 | $ 284,121 |
Change in redemption value of Preferred Units | 0 | 7,446 | ||
Issuance and sale of Preferred Units, net of issuance costs | 0 | 0 | 150,054 | |
Capital contributions | 111,887 | 32 | 149,172 | 2,283 |
Capital distributions | (562) | (10,910) | ||
Comprehensive income | 374 | 432 | 1,327 | 1,238 |
Ending Balance | 585,206 | 445,142 | 585,206 | 445,142 |
Consolidated funds | ||||
Increase (Decrease) in Redeemable Noncontrolling Interest [Roll Forward] | ||||
Beginning balance | 53,507 | 24,678 | 25,617 | 21,621 |
Change in redemption value of Preferred Units | 0 | 0 | ||
Issuance and sale of Preferred Units, net of issuance costs | 0 | 0 | ||
Capital contributions | 111,887 | 32 | 149,172 | 2,283 |
Capital distributions | (562) | (10,910) | ||
Comprehensive income | 374 | 432 | 1,327 | 1,238 |
Ending Balance | 165,206 | 25,142 | 165,206 | 25,142 |
Preferred Units | ||||
Increase (Decrease) in Redeemable Noncontrolling Interest [Roll Forward] | ||||
Beginning balance | 420,000 | 420,000 | 420,000 | 262,500 |
Change in redemption value of Preferred Units | 0 | 7,446 | ||
Issuance and sale of Preferred Units, net of issuance costs | 0 | 150,054 | ||
Capital contributions | 0 | 0 | 0 | 0 |
Capital distributions | 0 | 0 | ||
Comprehensive income | 0 | 0 | 0 | 0 |
Ending Balance | $ 420,000 | $ 420,000 | $ 420,000 | $ 420,000 |
Noncontrolling Interests - Add
Noncontrolling Interests - Additional Information (Detail) - shares | 3 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Oz Operating Group | ||
Noncontrolling Interest [Line Items] | ||
Percentage of ownership in entity | 42.60% | 41.50% |
Group A Units | ||
Noncontrolling Interest [Line Items] | ||
Relinquishment of Group A Units (shares) | 3,500,000 |
Investments and Fair Value Di_3
Investments and Fair Value Disclosures - Schedule of Investments (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Fair Value Disclosures [Abstract] | ||
United States government obligations, at fair value | $ 287,164 | $ 12,973 |
CLOs, at fair value | 165,795 | 211,749 |
Other funds and joint ventures, equity method | 32,251 | 14,252 |
Investments | $ 485,210 | $ 238,974 |
Investments and Fair Value Di_4
Investments and Fair Value Disclosures - Schedule of Investments Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | ||
Included Within Investments [Abstract] | ||||
United States government obligations | $ 287,164 | $ 12,973 | ||
CLOs | 165,795 | 211,749 | ||
Investments of Consolidated Funds [Abstract] | ||||
Investments | 485,210 | 238,974 | ||
Management company related | Fair Value, Measurements, Recurring | ||||
Included Within Cash And Cash Equivalents [Abstract] | ||||
United States government obligations | 79,994 | 99,704 | ||
Included Within Investments [Abstract] | ||||
United States government obligations | 287,164 | 12,973 | ||
CLOs | 165,795 | [1] | 211,749 | [2] |
Management company related | Fair Value, Measurements, Recurring | Level I | ||||
Included Within Cash And Cash Equivalents [Abstract] | ||||
United States government obligations | 79,994 | 99,704 | ||
Included Within Investments [Abstract] | ||||
United States government obligations | 287,164 | 12,973 | ||
CLOs | 0 | 0 | ||
Management company related | Fair Value, Measurements, Recurring | Level II | ||||
Included Within Cash And Cash Equivalents [Abstract] | ||||
United States government obligations | 0 | 0 | ||
Included Within Investments [Abstract] | ||||
United States government obligations | 0 | 0 | ||
CLOs | 0 | 0 | ||
Management company related | Fair Value, Measurements, Recurring | Level III | ||||
Included Within Cash And Cash Equivalents [Abstract] | ||||
United States government obligations | 0 | 0 | ||
Included Within Investments [Abstract] | ||||
United States government obligations | 0 | 0 | ||
CLOs | 165,795 | [1] | 211,749 | [2] |
Consolidated funds | Fair Value, Measurements, Recurring | ||||
Investments of Consolidated Funds [Abstract] | ||||
Bank debt | 182,066 | 43,366 | ||
Corporate bonds | 1,828 | |||
Investments | 183,894 | |||
Consolidated funds | Fair Value, Measurements, Recurring | Level I | ||||
Investments of Consolidated Funds [Abstract] | ||||
Bank debt | 0 | 0 | ||
Corporate bonds | 0 | |||
Investments | 0 | |||
Consolidated funds | Fair Value, Measurements, Recurring | Level II | ||||
Investments of Consolidated Funds [Abstract] | ||||
Bank debt | 120,468 | 24,559 | ||
Corporate bonds | 1,828 | |||
Investments | 122,296 | |||
Consolidated funds | Fair Value, Measurements, Recurring | Level III | ||||
Investments of Consolidated Funds [Abstract] | ||||
Bank debt | 61,598 | 18,807 | ||
Corporate bonds | 0 | |||
Investments | 61,598 | |||
CLOs | Management company related | ||||
Investments of Consolidated Funds [Abstract] | ||||
Contractual principal on investments in CLOs | $ 153,200 | $ 189,200 | ||
[1] | As of September 30, 2018, investments in CLOs had contractual principal amounts of $153.2 million outstanding, which excludes the Company’s investments in subordinated tranches of the notes, as these do not have contractual principal payments. | |||
[2] | As of December 31, 2017, investments in CLOs had contractual principal amounts of $189.2 million outstanding, which excludes the Company’s investments in subordinated tranches of the notes, as these do not have contractual principal payments. |
Investments and Fair Value Di_5
Investments and Fair Value Disclosures - Schedule of Changes in Company's Level III Investments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Management company related | CLOs | ||||
Fair Value, Investments Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning Balance | $ 148,127 | $ 43,723 | $ 211,749 | $ 21,341 |
Transfers In | 0 | 0 | 0 | 0 |
Transfers Out | 0 | 0 | 0 | 0 |
Investment Purchases / Issuances | 24,655 | 132,685 | 131,104 | 152,885 |
Investment Sales / Settlements | (5,483) | 0 | (170,403) | 0 |
Gains / Losses | (1,504) | 395 | (6,655) | 2,577 |
Ending Balance | 165,795 | 176,803 | 165,795 | 176,803 |
Consolidated funds | Bank debt | ||||
Fair Value, Investments Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning Balance | 32,515 | 39,338 | 18,807 | 18,127 |
Transfers In | 6,094 | 8,840 | 2,438 | 767 |
Transfers Out | (13,795) | (21,900) | (1,690) | (17,311) |
Investment Purchases / Issuances | 55,761 | 30,470 | 114,154 | 87,611 |
Investment Sales / Settlements | (19,356) | (33,975) | (72,838) | (67,082) |
Gains / Losses | 379 | 564 | 727 | 1,225 |
Ending Balance | $ 61,598 | $ 23,337 | $ 61,598 | $ 23,337 |
Investments and Fair Value Di_6
Investments and Fair Value Disclosures - Schedule of Net Unrealized Gains (Losses) on Company's Level III Assets and Liabilities (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Management company related | CLOs | ||||
Fair Value, Investments Measured On Recurring Basis [Line Items] | ||||
Unrealized gains (losses) on Level III assets and liabilities held as of the balance sheet date | $ (1,576) | $ 178 | $ (4,944) | $ 2,360 |
Consolidated funds | Bank debt | ||||
Fair Value, Investments Measured On Recurring Basis [Line Items] | ||||
Unrealized gains (losses) on Level III assets and liabilities held as of the balance sheet date | $ 240 | $ 61 | $ 274 | $ 142 |
Investments and Fair Value Di_7
Investments and Fair Value Disclosures - Loans Sold to CLOs Managed by the Company (Detail) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Fair Value Assets And Liabilities Measured On Nonrecurring Basis | |||
Loans sold to CLOs | $ 29,800 | $ 45,600 | |
Risk retention percentage | 5.00% | ||
Retained interest investments made | $ 24,900 | ||
Fair value of investments in retained interests | 91,800 | $ 70,400 | |
Cash flows from retained interests | $ 5,500 | $ 474 |
Variable Interest Entities - A
Variable Interest Entities - Assets and Liabilities of Funds that are VIEs and Consolidated by Company (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Assets of consolidated funds: | ||
Investments of consolidated funds, at fair value | $ 183,894 | $ 43,366 |
Other assets of consolidated funds | 39,302 | 13,331 |
Total Assets | 1,421,698 | 1,639,433 |
Liabilities of consolidated funds: | ||
Other liabilities of consolidated funds | 37,134 | 11,340 |
Total Liabilities | 861,290 | 1,289,745 |
Funds | Variable Interest Entity, Primary Beneficiary | ||
Assets of consolidated funds: | ||
Investments of consolidated funds, at fair value | 183,894 | 43,366 |
Other assets of consolidated funds | 39,302 | 13,331 |
Total Assets | 223,196 | 56,697 |
Liabilities of consolidated funds: | ||
Other liabilities of consolidated funds | 37,134 | 11,340 |
Total Liabilities | $ 37,134 | $ 11,340 |
Variable Interest Entities -_2
Variable Interest Entities - Assets and Liabilities Related to VIEs that are Not Consolidated (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Maximum risk of loss as a result of the Company's involvement with VIEs | ||
Income and fees receivable | $ 39,522 | $ 354,456 |
Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Net assets of unconsolidated VIEs in which the Company has a variable interest | 10,093,690 | 8,300,163 |
Maximum risk of loss as a result of the Company's involvement with VIEs | ||
Unearned revenues | 68,088 | 144,124 |
Income and fees receivable | 8,066 | 24,953 |
Investments in funds | 177,092 | 222,192 |
Maximum Exposure to Loss | $ 253,246 | $ 391,269 |
Other Assets, Net - Components
Other Assets, Net - Components of Other Assets (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Fixed Assets: | ||
Leasehold improvements | $ 54,225 | $ 53,419 |
Computer hardware and software | 47,473 | 44,190 |
Furniture, fixtures and equipment | 8,560 | 8,571 |
Accumulated depreciation and amortization | (65,169) | (58,671) |
Fixed assets, net | 45,089 | 47,509 |
Goodwill | 22,691 | 22,691 |
Prepaid expenses | 6,227 | 12,862 |
Loans held for sale | 0 | 29,110 |
Other | 5,138 | 4,189 |
Total Other Assets, Net | $ 79,145 | $ 116,361 |
Other Liabilities - Components
Other Liabilities - Components of Other Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | |
Other Liabilities Disclosure [Abstract] | |||
Legal provision(1) | $ 28,750 | [1] | $ 0 |
Accrued expenses | 20,620 | 21,955 | |
Uncertain tax positions | 7,000 | 7,000 | |
Deferred rent credit | 6,844 | 8,283 | |
Loan trades payable | 0 | 29,110 | |
Other | 11,867 | 8,774 | |
Total Other Liabilities | $ 75,081 | $ 75,122 | |
[1] | Legal provision represents accruals for certain contingencies discussed in Note 16. |
Debt Obligations - Schedule of
Debt Obligations - Schedule of CLO Investments Loans (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Borrowings outstanding | $ 290,127 | $ 569,379 |
November 28, 2016 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | Dec. 15, 2023 | |
Borrowings outstanding | $ 17,464 | 18,041 |
Interest rate spread over basis | 2.23% | |
June 07, 2017 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | Nov. 16, 2029 | |
Borrowings outstanding | $ 17,219 | 17,217 |
Interest rate spread over basis | 1.48% | |
July 21, 2017 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | Jan. 22, 2029 | |
Borrowings outstanding | $ 0 | 21,709 |
Interest rate spread over basis | 1.43% | |
August 02, 2017 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | Jan. 21, 2030 | |
Borrowings outstanding | $ 21,672 | 21,686 |
Interest rate spread over basis | 1.41% | |
August 17, 2017 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | Apr. 30, 2030 | |
Borrowings outstanding | $ 0 | 22,922 |
Interest rate spread over basis | 1.43% | |
September 14, 2017 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | Apr. 22, 2030 | |
Borrowings outstanding | $ 0 | 25,468 |
Interest rate spread over basis | 1.41% | |
September 14, 2017 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | Sep. 14, 2024 | |
Borrowings outstanding | $ 18,872 | 19,561 |
Interest rate spread over basis | 2.21% | |
November 21, 2017 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | May 15, 2030 | |
Borrowings outstanding | $ 0 | 26,202 |
Interest rate spread over basis | 1.34% | |
February 21, 2018 | ||
Debt Instrument [Line Items] | ||
CLO Investments Loans maturity dates | Feb. 21, 2019 | |
Borrowings outstanding | $ 21,081 | 0 |
Interest rate spread over basis | 1.27% | |
CLO Investments Loans | ||
Debt Instrument [Line Items] | ||
Borrowings outstanding | $ 96,308 | $ 172,806 |
Debt Obligations - Debt Obliga
Debt Obligations - Debt Obligations Additional Information (Detail) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Apr. 10, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||||
Repayment of debt obligations | $ 595,431 | $ 167,319 | ||
Fee-paying assets under management covenant amount | $ 20,000,000 | |||
Economic income ratio through third anniversary of closing date | 300.00% | |||
Economic income ratio following third anniversary of closing date | 250.00% | |||
Term Debt | ||||
Debt Instrument [Line Items] | ||||
2018 Term Debt borrowings outstanding | $ 200,000 | $ 250,000 | ||
2018 Term Loan maturity date | Apr. 10, 2023 | |||
Repayment of debt obligations | $ 400,000 | |||
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
2018 Revolving Credit Facility borrowing capacity | $ 100,000 | |||
Revolving Credit Facility | Minimum | ||||
Debt Instrument [Line Items] | ||||
Undrawn commitment fee | 0.20% | |||
Revolving Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Undrawn commitment fee | 0.75% | |||
CLO Investments Loans | ||||
Debt Instrument [Line Items] | ||||
Collateral on CLO Investments Loans | $ 116,500 | $ 206,600 | ||
Base Rate | Term Debt | ||||
Debt Instrument [Line Items] | ||||
Interest rate spread over basis | 3.75% | |||
Base Rate | Revolving Credit Facility | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate spread over basis | 0.75% | |||
Base Rate | Revolving Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate spread over basis | 1.75% | |||
LIBOR | Term Debt | ||||
Debt Instrument [Line Items] | ||||
Interest rate spread over basis | 4.75% | |||
LIBOR | Revolving Credit Facility | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate spread over basis | 1.75% | |||
LIBOR | Revolving Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate spread over basis | 2.75% |
Securities Sold under Agreeme_3
Securities Sold under Agreements to Repurchase - Balance Sheet Offsetting (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Transfers and Servicing of Financial Assets [Abstract] | ||
Gross Amounts of Recognized Liabilities | $ 42,378 | |
Gross Amounts Offset in the Consolidated Balance Sheet | 0 | |
Net Amounts of Liabilities in the Consolidated Balance Sheet | 42,378 | $ 0 |
Securities Transferred | 42,378 | |
Net Amount | $ 0 |
Securities Sold under Agreeme_4
Securities Sold under Agreements to Repurchase - Remaining Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Net Amounts of Liabilities in the Consolidated Balance Sheet | $ 42,378 | $ 0 |
CLOs | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Net Amounts of Liabilities in the Consolidated Balance Sheet | 42,378 | |
CLOs | Overnight and Continuous | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Net Amounts of Liabilities in the Consolidated Balance Sheet | 0 | |
CLOs | Up to 30 Days | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Net Amounts of Liabilities in the Consolidated Balance Sheet | 0 | |
CLOs | 30-90 Days | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Net Amounts of Liabilities in the Consolidated Balance Sheet | 0 | |
CLOs | Greater Than 90 Days | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Net Amounts of Liabilities in the Consolidated Balance Sheet | $ 42,378 |
Securities Sold under Agreeme_5
Securities Sold under Agreements to Repurchase - Additional Details (Details) - Repurchase agreements credit facility € in Millions | 9 Months Ended |
Sep. 30, 2018EUR (€) | |
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |
Repurchase agreements credit facility borrowing capacity | € 100 |
Interest rate spread over basis | 0.50% |
Repurchase agreements credit facility undrawn balance | € 63.2 |
Revenues - Management Fees and
Revenues - Management Fees and Incentive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Incentive income | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | $ 19,303 | $ 51,249 | $ 104,793 | $ 168,990 |
Management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 70,675 | $ 77,171 | 213,718 | $ 243,508 |
Multi-strategy funds | Incentive income | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 11,985 | 54,911 | ||
Multi-strategy funds | Management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 41,507 | 130,307 | ||
Opportunistic credit funds | Incentive income | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 2,514 | 33,045 | ||
Opportunistic credit funds | Management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 11,011 | 30,115 | ||
Institutional Credit Strategies | Incentive income | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 0 | 0 | ||
Institutional Credit Strategies | Management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 12,967 | 36,715 | ||
Real estate funds | Incentive income | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 4,804 | 15,895 | ||
Real estate funds | Management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 4,749 | 14,590 | ||
Other funds | Incentive income | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | 0 | 942 | ||
Other funds | Management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Investment management revenues | $ 441 | $ 1,991 |
Revenues - Unearned Incentive I
Revenues - Unearned Incentive Income Rollforward (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Revenue Recognition and Deferred Revenue [Abstract] | ||
Beginning of Year | $ 143,710 | |
Effects of adoption of ASU 2014-09 | $ (99,422) | |
Amounts collected during the period | 38,503 | |
Amounts recognized during the period | (14,806) | |
End of Period | $ 67,985 |
Revenues - Income and Fees Rece
Revenues - Income and Fees Receivable (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Income and Fees Receivable [Line Items] | ||
Income and fees receivable | $ 39,522 | $ 354,456 |
Management fees | ||
Income and Fees Receivable [Line Items] | ||
Income and fees receivable | 23,466 | 21,242 |
Incentive income | ||
Income and Fees Receivable [Line Items] | ||
Income and fees receivable | $ 16,056 | $ 333,214 |
Equity-Based Compensation Exp_3
Equity-Based Compensation Expenses - Equity-Based Compensation Expense Summary (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Expense recorded within compensation and benefits | $ 22,311 | $ 22,258 | $ 67,848 | $ 63,696 |
Corresponding tax benefit | $ 2,033 | $ 1,800 | $ 5,853 | $ 5,458 |
Equity-Based Compensation Exp_4
Equity-Based Compensation Expenses - Activity Related to Unvested Equity Awards (Detail) | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Equity-classified RSUs | |
Unvested Units | |
Unvested Units, Beginning of Year | shares | 14,530,602 |
Unvested Units, Granted | shares | 38,096,061 |
Unvested Units, Vested | shares | (2,525,241) |
Unvested Units, Canceled or Forfeited | shares | (8,624,982) |
Unvested Units, Modified | shares | (6,407,968) |
Unvested Units, End of Reporting Period | shares | 47,884,408 |
Weighted-Average Grant Date Fair Value | |
Weighted-Average Grant-Date Fair Value, Beginning of Year | $ / shares | $ 4.67 |
Weighted-Average Grant-Date Fair Value, Granted | $ / shares | 2.37 |
Weighted-Average Grant-Date Fair Value, Vested | $ / shares | 4.42 |
Weighted-Average Grant-Date Fair Value, Canceled or Forfeited | $ / shares | 3.72 |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | 6.36 |
Weighted-Average Grant-Date Fair Value, End of Reporting Period | $ / shares | $ 3.25 |
Liability-classified RSUs | |
Unvested Units | |
Unvested Units, Beginning of Year | shares | 0 |
Unvested Units, Granted | shares | 148,097 |
Unvested Units, Vested | shares | 0 |
Unvested Units, Canceled or Forfeited | shares | 0 |
Unvested Units, Modified | shares | (7,345,991) |
Unvested Units, End of Reporting Period | shares | 7,494,088 |
Weighted-Average Grant Date Fair Value | |
Weighted-Average Grant-Date Fair Value, Beginning of Year | $ / shares | $ 0 |
Weighted-Average Grant-Date Fair Value, Granted | $ / shares | 1.99 |
Weighted-Average Grant-Date Fair Value, Vested | $ / shares | 0 |
Weighted-Average Grant-Date Fair Value, Canceled or Forfeited | $ / shares | 0 |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | 6.36 |
Weighted-Average Grant-Date Fair Value, End of Reporting Period | $ / shares | $ 6.28 |
PSUs | |
Unvested Units | |
Unvested Units, Beginning of Year | shares | 0 |
Unvested Units, Granted | shares | 10,000,000 |
Unvested Units, Vested | shares | 0 |
Unvested Units, Canceled or Forfeited | shares | 0 |
Unvested Units, Modified | shares | 0 |
Unvested Units, End of Reporting Period | shares | 10,000,000 |
Weighted-Average Grant Date Fair Value | |
Weighted-Average Grant-Date Fair Value, Beginning of Year | $ / shares | $ 0 |
Weighted-Average Grant-Date Fair Value, Granted | $ / shares | 1.18 |
Weighted-Average Grant-Date Fair Value, Vested | $ / shares | 0 |
Weighted-Average Grant-Date Fair Value, Canceled or Forfeited | $ / shares | 0 |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | 0 |
Weighted-Average Grant-Date Fair Value, End of Reporting Period | $ / shares | $ 1.18 |
Group A Units | |
Unvested Units | |
Unvested Units, Beginning of Year | shares | 8,410,663 |
Unvested Units, Vested | shares | (1,574,811) |
Unvested Units, Canceled or Forfeited | shares | 0 |
Unvested Units, Modified | shares | (6,000,000) |
Unvested Units, End of Reporting Period | shares | 835,852 |
Weighted-Average Grant Date Fair Value | |
Weighted-Average Grant-Date Fair Value, Beginning of Year | $ / shares | $ 9.77 |
Weighted-Average Grant-Date Fair Value, Vested | $ / shares | 9.93 |
Weighted-Average Grant-Date Fair Value, Canceled or Forfeited | $ / shares | 0 |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | 9.75 |
Weighted-Average Grant-Date Fair Value, End of Reporting Period | $ / shares | $ 9.67 |
Group P Units | |
Unvested Units | |
Unvested Units, Beginning of Year | shares | 71,850,000 |
Unvested Units, Vested | shares | 0 |
Unvested Units, Canceled or Forfeited | shares | (500,000) |
Unvested Units, Modified | shares | (29,000,000) |
Unvested Units, End of Reporting Period | shares | 42,350,000 |
Weighted-Average Grant Date Fair Value | |
Weighted-Average Grant-Date Fair Value, Beginning of Year | $ / shares | $ 1.25 |
Weighted-Average Grant-Date Fair Value, Vested | $ / shares | 0 |
Weighted-Average Grant-Date Fair Value, Canceled or Forfeited | $ / shares | 1.25 |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | 1.25 |
Weighted-Average Grant-Date Fair Value, End of Reporting Period | $ / shares | $ 1.25 |
Equity-Based Compensation Exp_5
Equity-Based Compensation Expenses - Settlement of RSUs (Detail) - RSUs - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Fair value of RSUs settled in Class A Shares | $ 4,772 | $ 1,213 |
Fair value of RSUs settled in cash | 276 | 130 |
Fair value of RSUs withheld to satisfy tax withholding obligations | $ 2,419 | $ 840 |
Number of RSUs withheld to satisfy tax withholding obligations | 1,109,892 | 394,774 |
Equity-Based Compensation Exp_6
Equity-Based Compensation Expenses - Additional Information (Detail) $ / shares in Units, $ in Millions | 9 Months Ended |
Sep. 30, 2018USD ($)$ / sharesshares | |
Equity-classified RSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested Units, Modified | shares | (6,407,968) |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | $ 6.36 |
Unrecognized Compensation Expense | $ | $ 105.6 |
Weighted-Average Amortization Period | 2 years 11 months 12 days |
Unvested Units, Granted | shares | 38,096,061 |
Weighted-Average Grant-Date Fair Value, Granted | $ / shares | $ 2.37 |
Liability-classified RSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested Units, Modified | shares | (7,345,991) |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | $ 6.36 |
Unrecognized Compensation Expense | $ | $ 33.4 |
Weighted-Average Amortization Period | 3 years 11 months 1 day |
Unvested Units, Granted | shares | 148,097 |
Weighted-Average Grant-Date Fair Value, Granted | $ / shares | $ 1.99 |
PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested Units, Modified | shares | 0 |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | $ 0 |
Unrecognized Compensation Expense | $ | $ 9.3 |
Weighted-Average Amortization Period | 2 years 5 months |
Unvested Units, Granted | shares | 10,000,000 |
Weighted-Average Grant-Date Fair Value, Granted | $ / shares | $ 1.18 |
Expected Volatility Rate | 35.00% |
Expected Dividend Rate | 10.00% |
Risk Free Interest Rate | 2.60% |
Group A Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested Units, Modified | shares | (6,000,000) |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | $ 9.75 |
Unrecognized Compensation Expense | $ | $ 6.1 |
Weighted-Average Amortization Period | 1 year 6 months |
Group P Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested Units, Modified | shares | (29,000,000) |
Weighted-Average Grant-Date Fair Value, Modified | $ / shares | $ 1.25 |
Unrecognized Compensation Expense | $ | $ 29.5 |
Weighted-Average Amortization Period | 2 years 1 month |
Performance threshold - 25% | PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Incremental Percent of Units Vested Once Performance Threshold is Met | 20.00% |
Performance threshold - 50% | PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Incremental Percent of Units Vested Once Performance Threshold is Met | 40.00% |
Performance threshold - 75% | PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Incremental Percent of Units Vested Once Performance Threshold is Met | 20.00% |
Performance threshold - 125% | PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Incremental Percent of Units Vested Once Performance Threshold is Met | 20.00% |
PSU Units vest - 20% incremental and 20% total vest | PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Percent of Performance Condition for Units vesting | 25.00% |
PSU Units vest - 20% incremental and 60% total | PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Percent of Performance Condition for Units vesting | 50.00% |
PSU Units vest - 20% incremental and 80% total | PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Percent of Performance Condition for Units vesting | 75.00% |
PSU Units vest - 20% incremental and 100% total | PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Percent of Performance Condition for Units vesting | 125.00% |
Income Taxes - Additional Info
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||||
Effective Income Tax Rate | 2.40% | 10.90% | 0.70% | 23.10% | |
Unrecognized Tax Benefits | $ 7 | $ 7 | $ 7 | ||
Unrecognized Tax Benefits that Would Impact Effective Tax Rate | $ 4.3 | $ 4.3 |
General, Administrative and O_3
General, Administrative and Other - Components of General, Administrative and Other Expenses (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Other Income and Expenses [Abstract] | |||||
Professional services | $ 8,563 | $ 9,414 | $ 31,069 | $ 31,170 | |
Occupancy and equipment | 7,525 | 7,391 | 21,820 | 25,868 | |
Information processing and communications | 5,948 | 6,611 | 19,349 | 20,822 | |
Recurring placement and related service fees | 3,956 | 4,829 | 12,466 | 15,490 | |
Insurance | 1,844 | 1,843 | 5,531 | 5,727 | |
Business development | 1,018 | 644 | 3,271 | 5,614 | |
Foreign exchange losses and (gains) | 238 | (289) | 2,825 | (292) | |
Other expenses | 2,447 | 2,693 | 8,567 | 9,830 | |
General and Administrative Expense before Legal Provision | 31,539 | 33,136 | 104,898 | 114,229 | |
Legal provision | [1] | 18,750 | 0 | 31,750 | 0 |
General and Administrative Expense | $ 50,289 | $ 33,136 | $ 136,648 | $ 114,229 | |
[1] | Legal provision represents accruals for certain contingencies discussed in Note 16. |
(Loss) Earnings Per Class A S_3
(Loss) Earnings Per Class A Share - Computation of Basic and Diluted (Loss) Earnings Per Class A Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
(Loss) Earnings Per Share [Line Items] | ||||
Net (Loss) Income Attributable to Class A Shareholders | $ (14,537) | $ 5,726 | $ (23,303) | $ 11,660 |
Net (Loss) Income Attributable to Class A Shareholders, Diluted | $ (14,537) | $ 5,726 | $ (23,303) | $ 11,660 |
Weighted-Average Class A Shares Outstanding, Basic (in shares) | 192,657,766 | 186,235,651 | 192,485,281 | 186,201,389 |
Weighted-Average Class A Shares Outstanding, Diluted (in shares) | 192,657,766 | 186,235,651 | 192,485,281 | 186,201,389 |
(Loss) Income Per Class A Share, Basic (in dollars per share) | $ (0.08) | $ 0.03 | $ (0.12) | $ 0.06 |
(Loss) Income Per Class A Share, Diluted (in dollars per share) | $ (0.08) | $ 0.03 | $ (0.12) | $ 0.06 |
Group A Units | ||||
(Loss) Earnings Per Share [Line Items] | ||||
Net (Loss) Income Attributable to Class A Shareholders, Effect of dilutive securities | $ 0 | $ 0 | $ 0 | $ 0 |
Weighted-Average Class A Shares Outstanding, Effect of dilutive securities (in shares) | 0 | 0 | 0 | 0 |
Number of Antidilutive Units Excluded from Diluted Calculation (in shares) | 258,978,608 | 267,489,478 | 261,654,313 | 273,923,088 |
RSUs | ||||
(Loss) Earnings Per Share [Line Items] | ||||
Weighted-Average Class A Shares Outstanding, Effect of dilutive securities (in shares) | 0 | 0 | 0 | 0 |
Number of Antidilutive Units Excluded from Diluted Calculation (in shares) | 54,760,583 | 22,538,548 | 46,200,732 | 21,733,730 |
(Loss) Earnings Per Class A S_4
(Loss) Earnings Per Class A Share - Additional Information (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
RSUs | ||||
(Loss) Earnings Per Share [Line Items] | ||||
Vested RSUs included in weighted-average Class A Shares outstanding | 1,204,603 | 1,011,588 | 1,472,863 | 1,103,969 |
Related Party Transactions - M
Related Party Transactions - Management Fees and Incentive Income Earned from Related Parties and Waived Fees (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Management fees | ||||
Related Party Transaction [Line Items] | ||||
Investment management revenues | $ 70,675 | $ 77,171 | $ 213,718 | $ 243,508 |
Management fees | Fees charged on investments held by related parties: | ||||
Related Party Transaction [Line Items] | ||||
Investment management revenues | 4,148 | 2,703 | 10,621 | 8,037 |
Incentive Income | ||||
Related Party Transaction [Line Items] | ||||
Investment management revenues | 19,303 | 51,249 | 104,793 | 168,990 |
Incentive Income | Fees charged on investments held by related parties: | ||||
Related Party Transaction [Line Items] | ||||
Investment management revenues | $ 1,795 | $ 141 | $ 4,249 | $ 2,476 |
Related Party Transactions - A
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2018 | |
Related Party Transactions [Abstract] | ||
Amount of related parties assets under management | $ 2,800,000 | $ 2,200,000 |
Percent of assets under management not charged management and incentive fees | 69.00% | 28.00% |
Fees charged for use of corporate aircraft | $ 360 |
Commitments and Contingencies
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2018 | Jun. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Nov. 19, 2007 | ||
Loss Contingencies [Line Items] | |||||||
Percentage of tax savings to be paid under Tax Receivable Agreement | 78.00% | 78.00% | 85.00% | ||||
Estimated future payments under tax receivable agreement | $ 280,000 | $ 280,000 | |||||
Legal provision | [1] | 18,750 | $ 0 | 31,750 | $ 0 | ||
Unfunded capital commitments of the Company to funds managed | 24,200 | 24,200 | |||||
Unfunded capital commitments of certain related parties to funds managed | 76,900 | $ 76,900 | |||||
New York | |||||||
Loss Contingencies [Line Items] | |||||||
Non cancelable lease expiration year | 2,029 | ||||||
Other Locations | |||||||
Loss Contingencies [Line Items] | |||||||
Non cancelable lease expiration year | 2,024 | ||||||
A legal matter | |||||||
Loss Contingencies [Line Items] | |||||||
Legal provision | $ 18,800 | $ 10,000 | $ 28,800 | ||||
A commercial matter | |||||||
Loss Contingencies [Line Items] | |||||||
Legal provision | $ 3,000 | ||||||
[1] | Legal provision represents accruals for certain contingencies discussed in Note 16. |
Segment Information - Oz Funds
Segment Information - Oz Funds Segment Results (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Oz Funds Segment: | ||||
Revenues | $ 93,827 | $ 131,999 | $ 332,003 | $ 420,097 |
Operating Segments | Oz Funds Segment | ||||
Oz Funds Segment: | ||||
Revenues | 79,763 | 119,390 | 287,148 | 380,999 |
Economic Income | $ (7,483) | $ 49,768 | $ 49,410 | $ 157,891 |
Segment Information - Reconcil
Segment Information - Reconciliation of Oz Funds Segment Revenues to Consolidated Revenues (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Segment Reporting Information [Line Items] | |||||
Revenues | $ 93,827 | $ 131,999 | $ 332,003 | $ 420,097 | |
Income of consolidated funds | (507) | (2,055) | (1,741) | (3,518) | |
Material Reconciling Items | |||||
Segment Reporting Information [Line Items] | |||||
Adjustment to management fees | [1] | (4,222) | (4,827) | (13,440) | (15,488) |
Adjustment to other revenue | [2] | 0 | 141 | (39) | (1,117) |
Other Operations revenues | (9,335) | (5,868) | (29,635) | (18,975) | |
Income of consolidated funds | (507) | (2,055) | (1,741) | (3,518) | |
Operating Segments | Oz Funds Segment | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | $ 79,763 | $ 119,390 | $ 287,148 | $ 380,999 | |
[1] | Adjustment to present management fees net of recurring placement and related service fees, as management considers these fees a reduction in management fees, not an expense. The impact of eliminations related to the consolidated funds is also removed. | ||||
[2] | Adjustment to exclude realized gains on sale of fixed assets. |
Segment Information - Reconc_2
Segment Information - Reconciliation of Oz Funds Economic Income to Net (Loss) Income Attributable to Class A Shareholders (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Segment Reporting Information [Line Items] | ||||
Net (Loss) Income Attributable to Class A Shareholders—GAAP | $ (14,537) | $ 5,726 | $ (23,303) | $ 11,660 |
Change in redemption value of Preferred Units | 0 | 0 | 0 | 2,853 |
Net (Loss) Income Attributable to Och-Ziff Capital Management Group LLC—GAAP | (14,537) | 5,726 | (23,303) | 14,513 |
Income taxes | (860) | 1,942 | (372) | 17,242 |
Net losses on early retirement of debt | 0 | 0 | 14,303 | 0 |
Depreciation, amortization and net gains and losses on fixed assets | 7,709 | 7,693 | ||
Material Reconciling Items | ||||
Segment Reporting Information [Line Items] | ||||
Net (loss) income attributable to Group A Units | (21,798) | 9,500 | (35,343) | 41,145 |
Equity-based compensation, net of RSUs settled in cash | 22,311 | 22,128 | 67,572 | 63,566 |
Adjustment to recognize deferred cash compensation in the period of grant | 791 | (254) | 15,548 | (666) |
Income taxes | (860) | 1,942 | (372) | 17,242 |
Net losses on early retirement of debt | 0 | 0 | 14,303 | 0 |
Allocations to Group D Units | 783 | 1,554 | 3,060 | 4,914 |
Adjustment for expenses related to compensation and profit-sharing arrangements based on fund investment performance | 4,229 | 7,470 | 4,622 | 13,242 |
Depreciation, amortization and net gains and losses on fixed assets | 2,543 | 2,237 | 7,709 | 7,693 |
Other adjustments | 781 | (314) | 1,383 | (1,511) |
Other Operations | (1,726) | (221) | (5,769) | (2,247) |
Operating Segments | Oz Funds Segment | ||||
Segment Reporting Information [Line Items] | ||||
Economic Income - Oz Funds Segment | $ (7,483) | $ 49,768 | $ 49,410 | $ 157,891 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - Subsequent Event | Nov. 02, 2018$ / shares |
Subsequent Event [Line Items] | |
Dividends announcement date | Nov. 2, 2018 |
Cash dividend (in dollars per share) | $ 0.02 |
Dividends payable date | Nov. 20, 2018 |
Dividends record date | Nov. 13, 2018 |