Investment In Unconsolidated Affiliates

3 Months Ended

Mar. 31, 2016

Equity Method Investments and Joint Ventures [Abstract]

Investment in Unconsolidated Affiliates

LSV Asset Management

The Company has an investment in LSV Asset Management (LSV), a registered investment advisor that provides investment advisory services primarily to institutions, including pension plans and investment companies. LSV is currently an investment sub-advisor for a limited number of SEI-sponsored mutual funds. The Company accounts for its interest in LSV using the equity method because of its less than 50 percent ownership. The Company’s interest in the net assets of LSV is reflected in Investment in unconsolidated affiliates on the accompanying Consolidated Balance Sheets and its interest in the earnings of LSV is reflected in Equity in earnings of unconsolidated affiliates on the accompanying Consolidated Statements of Operations.

At March 31, 2016, the Company’s total investment in LSV was $44,247. The Company receives partnership distributions from LSV on a quarterly basis. The Company received partnership distributions from LSV of $34,525 and $37,003 in the three months ended March 31, 2016 and 2015, respectively.

The Company’s proportionate share in the earnings of LSV was $29,192 and $34,345 during the three months ended March 31, 2016 and 2015, respectively.

The following table contains the condensed financial operations of LSV for the three months ended March 31, 2016 and 2015:



	Three Months Ended March 31,
	2016		2015
Revenues	$	92,653	$	105,895
Net income	74,457		87,425

As of March 31, 2016, the Company's total partnership interest in LSV was approximately 39.2 percent. In April 2016, LSV provided an interest in the partnership to select key employees which reduced the ownership percentage of each existing partner on a pro-rata basis. As a result, the Company's total partnership interest in LSV was reduced to approximately 38.9 percent.

Guaranty Agreement with LSV Employee Group III

In October 2012, LSV Employee Group III purchased a portion of the partnership interest of three existing LSV employees for $77,700, of which $69,930 was financed through two syndicated term loan facilities contained in a credit agreement with The PrivateBank and Trust Company. The Company provided an unsecured guaranty for $45,000 of the obligations of LSV Employee Group III to the lenders through a guaranty agreement. The lenders have the right to seek payment from the Company in the event of a default by LSV Employee Group III. LSV agreed to provide an unsecured guaranty for $24,930 of the obligations of LSV Employee Group III to the lenders through a separate guaranty agreement.

The Company’s direct interest in LSV was unchanged as a result of this transaction. The Company has determined that LSV Employee Group III is a VIE; however, the Company is not considered the primary beneficiary because it does not have the power to direct the activities that most significantly impact the economic performance of LSV Employee Group III either directly or through any financial responsibility from the guaranty.

In September 2014, LSV Employee Group III made the final principal payment related to the term loan guaranteed by LSV. As of April 19, 2016, the remaining unpaid principal balance of the term loan guaranteed by the Company was $16,915. LSV Employee Group III has met all financial obligations to date regarding the scheduled repayment of the term loans since origination. The Company, in its capacity as guarantor, currently has no obligation of payment relating to the term loan of LSV Employee Group III and, furthermore, fully expects that LSV Employee Group III will meet all of their future obligations regarding the term loan.