Legg Mason Inc. (NYSE:LM) agreed to acquire 82% stake in Clarion Partners, LLC from Lightyear Fund 3, fund of Lightyear Capital LLC for approximately $600 million in cash on January 21, 2016. Under the terms of the transaction, Legg Mason will pay for its portion of certain co-investments on a dollar for dollar basis, estimated at $16 million as of December 31, 2015. The management team will retain 17% of the outstanding equity in Clarion Partners. Clarion Partners will operate as the primary independent real estate investment affiliate for Legg Mason. The transaction will be financed with proceeds of offering of Legg Mason's senior notes and junior notes along with $500 million draw from revolving credit facility. The transaction is subject to customary regulatory and other approvals. The transaction is expected to close in the first quarter of 2017 fiscal year. The transaction is expected to be modestly accretive to earnings in the first year after the closing, excluding one-time deal-related charges of $10-$15 million. As on April 13, 2016, Legg Mason acquired 82% stake in Clarion Partners. Jon Stern of Berkshire Capital acted as financial advisor to Clarion Partners.

RBC Capital Markets and Azrack & Company acted as financial advisors to Legg Mason. Morgan Stanley & Co. LLC acted as financial advisor to Clarion Partners. Michael Davis, Harold Birnbaum, Camila Panama, Michael Mollerus, Vinay Prabhakar, Edmond T. FitzGerald, Pritesh P. Shah, Gregory S. Rowland and Gregory S. Rowland of Davis Polk & Wardwell LLP acted as legal advisor to both Lightyear Capital and Clarion Partners. Tony Rothermel, John Wilson, Kristina Thomas, Kathleen Minniti, Douglas Elsbeck, David Hudson, Clara Kim, Kathryn Furman, Spencer Johnson, Gibbs Fryer, Charlie Arnold, Clay Karwisch , Randall Robinson, Jim Lokey , Robert Beard, Kenneth Raskin, Laura , Scott Mario, Richard , Penn Huston and Martha Daniels of King & Spalding LLP acted as legal advisor to Clarion. Grail Partners acted as financial advisor to Clarion. O'Melveny & Myers LLP acted as legal advisor for RBC Capital Markets. John A. Marzulli Jr., Stephen Besen, Kenneth Laverriere, Meshal Ibrahim Alsugair, Jordan J. Altman, Corey Betker, Lisa M. Brill, Robert Bucella, Katie Allison Butler, Suzanne Skinner Forster, Gita B. Gandhi, Nathan J. Greene, Kelly E. Hamren-Anderson, Nancy Hau, Brian Hurd, Mikito Ishida, Kelly Karapetyan, Kenneth J. Laverriere, Oliver Linch, Thomas M. Majewski, Taptesh Kaur Matharu, Orla Margaret McMahon, Edward Miles, Jennifer D. Morton, Arman Naraghi-Pour, Trevor Okomba, Fabio Pazzini, Hong Nhung Pham, Brian H. Polovoy, John Reiss, Barney Reynolds, Michael Shulman, Russell D. Sacks, Paul S. Schreiber, Sayuri Shimoda, Matthew Allen Weston, Matthew Paul Wochok and Jeffrey Carlsson Wolf of Shearman & Sterling LLP acted as legal advisor for Legg Mason Inc.