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Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of September 30, 2023:

(Dollars in millions)			Level I						Level II						Level III						Total
Assets
Investments of Consolidated Funds(1):
Equity securities(2)			$	—					$	—					$	369.7					$	369.7
Bonds			—						—						478.7						478.7
Loans			—						—						5,746.8						5,746.8
			—						—						6,595.2						6,595.2
Investments in CLOs and other:
Investments in CLOs			—						—						524.7						524.7
Other investments(3)			41.2						42.7						81.8						165.7
			41.2						42.7						606.5						690.4
Corporate treasury investments:
Commercial paper and other			—						57.3						—						57.3
			—						57.3						—						57.3
Foreign currency forward contracts			—						0.3						—						0.3
Subtotal			$	41.2					$	100.3					$	7,201.7					$	7,343.2
Investments measured at net asset value																					475.1
Total																					$	7,818.3
Liabilities
Loans payable of Consolidated Funds(4)(5)			$	—					$	—					$	6,249.7					$	6,249.7
Total			$	—					$	—					$	6,249.7					$	6,249.7

(1)This balance excludes $464.0 million related to investments of consolidated funds that are included in investments measured at net asset value.

(2)This balance includes $321.6 million related to investments that have been bridged by the Company to investment funds and are accounted for as consolidated VIEs as of September 30, 2023.

(3)The Level III balance excludes $50.1 million related to three corporate investments in equity securities which the Company has elected to account for under the measurement alternative for equity securities without readily determinable fair values pursuant to ASC 321, Investments – Equity Securities. As a non-recurring fair value measurement, the fair value of these equity securities is excluded from the tabular Level III rollforward disclosures.

(4)Senior and subordinated notes issued by CLO vehicles are valued based on the more observable fair value of the CLO financial assets, less (i) the fair value of any beneficial interest held by the Company and (ii) the carrying value of any beneficial interests that represent compensation for services.

(5)Loans payable of Consolidated Funds balance excludes a $169.5 million revolving credit balance related to loans payable of Consolidated Funds.

The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of December 31, 2022:

(Dollars in millions)			Level I						Level II						Level III						Total
Assets
Investments of Consolidated Funds(1):
Equity securities(2)			$	—					$	—					$	430.6					$	430.6
Bonds			—						—						594.9						594.9
Loans			—						—						5,352.9						5,352.9
			—						—						6,378.4						6,378.4
Investments in CLOs and other:
Investments in CLOs			—						—						526.1						526.1
Other investments(3)			1.6						41.6						79.4						122.6
			1.6						41.6						605.5						648.7
Corporate treasury investments:
Commercial paper and other			—						20.0						—						20.0
			—						20.0						—						20.0
Foreign currency forward contracts			—						2.2						—						2.2
Subtotal			$	1.6					$	63.8					$	6,983.9					$	7,049.3
Investments measured at net asset value																					528.5
Total																					$	7,577.8
Liabilities
Loans payable of Consolidated Funds(4)(5)			$	—					$	—					$	5,491.6					$	5,491.6
Foreign currency forward contracts			—						3.2						—						3.2
Total			$	—					$	3.2					$	5,491.6					$	5,494.8

(1)This balance excludes $516.0 million related to investments of consolidated funds that are included in investments measured at net asset value.

(2)This balance includes $377.4 million related to investments that have been bridged by the Company to investment funds and are accounted for as consolidated VIEs as of December 31, 2022.

(3)The Level III balance excludes $58.2 million related to two corporate investments in equity securities which the Company has elected to account for under the measurement alternative for equity securities without readily determinable fair values pursuant to ASC 321, Investments – Equity Securities. As a non-recurring fair value measurement, the fair value of these equity securities is excluded from the tabular Level III rollforward disclosures.

(4)Senior and subordinated notes issued by CLO vehicles are valued based on the more observable fair value of the CLO financial assets, less (i) the fair value of any beneficial interests held by the Company and (ii) the carrying value of any beneficial interests that represent compensation for services.

(5)Loans payable of Consolidated Funds balance excludes $235.6 million of senior notes measured at amortized cost and a $178.0 million revolving credit balance related to loans payable of Consolidated Funds.

Schedule of Changes in Level III Financial Assets Measured at Fair Value

The changes in financial instruments measured at fair value for which the Company has used Level III inputs to determine fair value are as follows (Dollars in millions):

			Financial Assets
			Three Months Ended September 30, 2023
			Investments of Consolidated Funds
			Equity securities						Bonds						Loans																		Investments in CLOs						Other investments						Total
Balance, beginning of period			$	487.6					$	548.4					$	5,858.4																	$	538.1					$	81.5					$	7,514.0
Deconsolidation of funds(1)			(18.4)						—						—																		—						—						(18.4)
Purchases			6.3						56.4						465.7																		1.0						—						529.4
Sales and distributions			(109.0)						(116.2)						(422.7)																		(16.7)						(0.9)						(665.5)
Settlements			—						—						(172.3)																		—						—						(172.3)
Realized and unrealized gains (losses), net
Included in earnings			3.2						5.2						113.0																		17.2						1.2						139.8
Included in other comprehensive income			—						(15.1)						(95.3)																		(14.9)						—						(125.3)
Balance, end of period			$	369.7					$	478.7					$	5,746.8																	$	524.7					$	81.8					$	7,201.7
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date			$	(1.5)					$	4.4					$	117.0																	$	17.2					$	0.3					$	137.4
Changes in unrealized gains (losses) included in other comprehensive income related to financial assets still held at the reporting date			$	—					$	(12.7)					$	(90.9)																	$	(14.9)					$	—					$	(118.5)
			Financial Assets
			Nine Months Ended September 30, 2023
			Investments of Consolidated Funds
			Equity securities						Bonds						Loans																					Investments in CLOs						Other investments			Total
Balance, beginning of period			$	430.6					$	594.9					$	5,352.9																	$	526.1					$	79.4					$	6,983.9
Deconsolidation of funds(1)			(18.8)						—						(372.2)																		—						—						(391.0)
Purchases			64.8						128.0						1,903.9																		1.0						—						2,097.7
Sales and distributions			(109.0)						(244.5)						(857.7)																		(37.4)						(2.6)						(1,251.2)
Settlements			—						(8.2)						(451.2)																		—						—						(459.4)
Realized and unrealized gains (losses), net
Included in earnings			2.1						13.3						206.3																		33.1						5.0						259.8
Included in other comprehensive income			—						(4.8)						(35.2)																		1.9						—						(38.1)
Balance, end of period			$	369.7					$	478.7					$	5,746.8																	$	524.7					$	81.8					$	7,201.7
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date			$	(2.8)					$	7.1					$	184.6																	$	33.1					$	2.4					$	224.4
Changes in unrealized gains (losses) included in other comprehensive income related to financial assets still held at the reporting date			$	—					$	(5.1)					$	(40.5)																	$	1.9					$	—					$	(43.7)

(1) As a result of the deconsolidation of one fund during the three and nine months ended September 30, 2023.

			Financial Assets
			Three Months Ended September 30, 2022
			Investments of Consolidated Funds
			Equity securities						Bonds						Loans																		Investments in CLOs						Other investments						Total
Balance, beginning of period			$	12.4					$	669.8					$	5,516.8																	$	508.6					$	65.1					$	6,772.7
Purchases			518.5						46.6						473.9																		19.9						—						1,058.9
Sales and distributions			—						(92.6)						(552.4)																		(7.2)						(0.9)						(653.1)
Settlements			—						—						(130.4)																		—						—						(130.4)
Realized and unrealized gains (losses), net
Included in earnings			(18.3)						(21.6)						(30.0)																		7.1						0.4						(62.4)
Included in other comprehensive income			(0.7)						(41.4)						(223.2)																		(28.8)						—						(294.1)
Balance, end of period			$	511.9					$	560.8					$	5,054.7																	$	499.6					$	64.6					$	6,691.6
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date			$	(18.3)					$	(22.1)					$	(35.7)																	$	4.5					$	0.4					$	(71.2)
Changes in unrealized gains (losses) included in other comprehensive income related to financial assets still held at the reporting date			$	(0.7)					$	(34.3)					$	(202.2)																	$	(28.8)					$	—					$	(266.0)
			Financial Assets
			Nine Months Ended September 30, 2022
			Investments of Consolidated Funds
			Equity securities						Bonds						Loans																		Investments in CLOs						Other investments						Total
Balance, beginning of period			$	17.9					$	599.5					$	5,898.1																	$	361.1					$	78.7					$	6,955.3
Purchases			518.6						429.0						2,014.8																		251.9						0.9						3,215.2
Sales and distributions			(7.2)						(320.2)						(1,566.5)																		(36.1)						(3.8)						(1,933.8)
Settlements			—						(0.3)						(492.1)																		—						—						(492.4)
Realized and unrealized gains (losses), net
Included in earnings			(15.9)						(59.6)						(277.4)																		(17.9)						(11.2)						(382.0)
Included in other comprehensive income			(1.5)						(87.6)						(522.2)																		(59.4)						—						(670.7)
Balance, end of period			$	511.9					$	560.8					$	5,054.7																	$	499.6					$	64.6					$	6,691.6
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date			$	(16.7)					$	(57.0)					$	(266.3)																	$	(17.9)					$	(11.2)					$	(369.1)
Changes in unrealized gains (losses) included in other comprehensive income related to financial assets still held at the reporting date			$	(1.3)					$	(55.2)					$	(422.7)																	$	(59.4)					$	—					$	(538.6)

Schedule of Changes in Level III Financial Liabilities Measured at Fair Value

			Financial Liabilities
			Loans Payable of Consolidated Funds
			Three Months Ended September 30,
			2023						2022
Balance, beginning of period			$	6,383.9					$	5,757.8
Borrowings			5.4						26.4
Paydowns			(2.0)						(1.8)
Sales			(156.2)						(193.9)
Realized and unrealized (gains) losses, net
Included in earnings			131.0						(40.8)
Included in other comprehensive income			(112.4)						(244.0)
Balance, end of period			$	6,249.7					$	5,303.7
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date			$	132.9					$	(41.3)
Changes in unrealized (gains) losses included in other comprehensive income related to financial liabilities still held at the reporting date			$	(112.1)					$	(235.5)
			Financial Liabilities
			Loans Payable of Consolidated Funds
			Nine Months Ended September 30,
			2023						2022
Balance, beginning of period			$	5,491.6					$	5,811.0
Borrowings			875.2						1,597.7
Paydowns			(51.0)						(419.1)
Sales			(276.8)						(863.4)
Realized and unrealized (gains) losses, net
Included in earnings			252.7						(268.3)
Included in other comprehensive income			(42.0)						(554.2)
Balance, end of period			$	6,249.7					$	5,303.7
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date			$	225.5					$	(262.6)
Changes in unrealized (gains) losses included in other comprehensive income related to financial liabilities still held at the reporting date			$	(36.1)					$	(567.0)

Schedule of Quantitative Information About Level III Inputs

The following table summarizes quantitative information about the Company’s Level III inputs as of September 30, 2023:

Fair Value at

Valuation Technique(s)

Unobservable Input(s)

Range (Weighted Average)

(Dollars in millions)

September 30, 2023

Assets

Investments of Consolidated Funds:

Equity securities

$

3.8

Consensus Pricing

Indicative Quotes ($ per share)

0.00 - 337.17 (0.14)

321.6

Discounted Cash Flow

Discount Rates

10% - 10% (10%)

Terminal Growth Rate

0% - 7% (5%)

Comparable Multiple

EBITDA Multiple

12.7x - 12.7x (12.7x)

TCF Multiple

23.8x - 23.8x (23.8x)

44.3

Discounted Cash Flow

Discount Rates

10% - 10% (10%)

Terminal Growth Rate

0% - 7% (5%)

Comparable Multiple

TCF Multiple

23.8x - 23.8x (23.8x)

Bonds

478.7

Consensus Pricing

Indicative Quotes (% of Par)

30 - 108 (88)

Loans

5,717.4

Consensus Pricing

Indicative Quotes (% of Par)

0 - 115 (96)

10.9

Discounted Cash Flow

Discount Rates

7% - 16% (15%)

9.6

Discounted Cash Flow

Discount Rates

19% - 19% (19%)

Constant Prepayment Rate

10% - 10% (10%)

Constant Default Rate

2% - 2% (2%)

Recovery Rate

30% - 30% (30%)

8.9

Other(1)

N/A

N/A

6,595.2

Investments in CLOs:

Senior secured notes

465.1

Consensus Pricing with Discounted Cash Flow

Indicative Quotes (% of Par)

71 - 100 (96)

Discount Margins (Basis Points)

155 - 1,600 (311)

Default Rates

2% - 2% (2%)

Recovery Rates

60% - 60% (60%)

Subordinated notes and preferred shares

59.6

Consensus Pricing with Discounted Cash Flow

Indicative Quotes (% of Par)

2 - 96 (42)

Discount Rates

11% - 28% (22%)

Default Rates

2% - 2% (2%)

Recovery Rates

60% - 60% (60%)

Other investments:

BDC preferred shares

79.3

Market Yield Analysis

Market Yields

11% - 11% (11%)

Aviation subordinated notes

2.5

Discounted Cash Flow

Discount Rates

21% - 21% (21%)

Total

$

7,201.7

Liabilities

Loans payable of Consolidated Funds:

Senior secured notes

$

6,040.9

Other(2)

N/A

N/A

Subordinated notes and preferred shares

208.8

Consensus Pricing with Discounted Cash Flow

Indicative Quotes (% of Par)

19 - 99 (41)

Discount Rates

15% - 28% (19%)

Default Rates

2% - 2% (2%)

Recovery Rates

60% - 60% (60%)

Total

$

6,249.7

(1) Fair value approximates transaction price that was in close proximity to the reporting date.

(2) Senior and subordinated notes issued by CLO vehicles are classified based on the more observable fair value of the CLO financial assets, less (i) the fair value of any beneficial interests held by the Company and (ii) the carrying value of any beneficial interests that represent compensation for services.

The following table summarizes quantitative information about the Company’s Level III inputs as of December 31, 2022:

Fair Value at

Valuation Technique(s)

Unobservable Input(s)

Range (Weighted Average)

(Dollars in millions)

December 31, 2022

Assets

Investments of Consolidated Funds:

Equity securities

$

3.1

Consensus Pricing

Indicative Quotes ($ per share)

0.00 - 4.73 (0.18)

363.5

Discounted Cash Flow

Discount Rates

10% - 10% (10%)

Terminal Growth Rate

0% - 7% (5%)

Comparable Multiple

EBITDA Multiple

12.7x - 12.7x (12.7x)

TCF Multiple

23.8x - 23.8x (23.8x)

64.0

Other(1)

N/A

N/A

Bonds

594.9

Consensus Pricing

Indicative Quotes (% of Par)

46 - 105 (88)

Loans

5,043.4

Consensus Pricing

Indicative Quotes (% of Par)

0 - 100 (91)

11.8

Discounted Cash Flow

Discount Rates

0% - 9% (1%)

248.7

Discounted Cash Flow

Discount Rates

7% - 10% (8%)

37.4

Consensus Pricing

Indicative Quotes (% of Par)

97% - 98% (97%)

11.1

Consensus Pricing

Indicative Quotes (% of Par)

91% - 91% (91%)

0.5

Other(1)

N/A

N/A

6,378.4

Investments in CLOs:

Senior secured notes

462.1

Discounted Cash Flow with Consensus Pricing

Indicative Quotes (% of Par)

67 - 100 (93)

Discount Margins (Basis Points)

170 - 1,800 (386)

Default Rates

2% - 3% (2%)

Recovery Rates

50% - 70% (60%)

Subordinated notes and preferred shares

64.0

Discounted Cash Flow with Consensus Pricing

Indicative Quotes (% of Par)

0 - 82 (40)

Discount Rate

15% - 25% (20%)

Default Rates

2% - 3% (2%)

Recovery Rates

50% - 70% (60%)

Other investments:

BDC preferred shares

76.9

Market Yield Analysis

Market Yields

11% - 11% (11%)

Aviation subordinated notes

2.5

Discounted Cash Flow

Discount Rates

21% - 21% (21%)

Total

$

6,983.9

Liabilities

Loans payable of Consolidated Funds:

Senior secured notes

$

5,303.3

Other(2)

N/A

N/A

Subordinated notes and preferred shares

188.3

Discounted Cash Flow with Consensus Pricing

Indicative Quotes (% of Par)

21 - 96 (38)

Discount Rates

15% - 25% (20%)

Default Rates

2% - 3% (3%)

Recovery Rates

50% - 70% (60%)

Total

$

5,491.6

(1) Fair value approximates transaction price that was in close proximity to the reporting date.

(2) Senior and subordinated notes issued by CLO vehicles are classified based on the more observable fair value of the CLO financial assets, less (i) the fair value of any beneficial interests held by the Company and (ii) the carrying value of any beneficial interests that represent compensation for services.

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