Form 4: Ares Management CEO Michael Arougheti Executes Stock Sales Under 10b5-1 Plan

Ares Management CEO Michael Arougheti sold shares of Class A Common Stock through a pre-arranged 10b5-1 trading plan, while also acquiring shares through the conversion of Ares Operating Group Units.

Summary

• Michael Arougheti, Co-Founder, CEO and President of Ares Management Corp, reported transactions involving Class A Common Stock.
• On August 15, 2024, Arougheti acquired 250,000 shares of Class A Common Stock through the conversion of Ares Operating Group Units.
• Between August 15 and August 19, 2024, Arougheti sold a total of 55,419 shares of Class A Common Stock at prices ranging from $144.19 to $146.48, executed under a 10b5-1 trading plan adopted on December 14, 2023.
• These sales were conducted in multiple transactions at weighted average prices on each of the specified dates.
• Arougheti also holds 1,375,000 restricted units granted under an equity incentive plan, each representing the right to receive one share of Class A Common Stock upon vesting.
• He indirectly holds 9,271,596 Ares Operating Group Units through Ares Owners Holdings L.P., which are exchangeable for Class A Common Stock on a one-for-one basis.

Sentiment

Score: 6

Explanation: Neutral sentiment. The transactions are part of a pre-planned trading strategy, but the sale of shares by the CEO could raise minor concerns.

Positives

• The CEO's continued holding of a significant number of shares and units demonstrates ongoing investment in the company.
• The use of a pre-arranged 10b5-1 trading plan suggests transparency and avoids concerns about insider trading.

Negatives

• The sale of shares by the CEO, even under a 10b5-1 plan, could be perceived negatively by some investors.

Risks

• Further sales of shares by the CEO could put downward pressure on the stock price.
• Market conditions could impact the value of the remaining shares and units held by the CEO.

Future Outlook

The document does not contain specific forward-looking statements, but the CEO's continued holdings suggest a long-term commitment to the company.

Industry Context

Transactions by key executives are closely watched in the asset management industry as indicators of company performance and management confidence. The use of a 10b5-1 plan is a common practice to manage potential insider trading concerns.

Comparison to Industry Standards

• Comparing Arougheti's transactions to those of CEOs at similar firms like Blackstone (BX) or Apollo Global Management (APO) would provide context.
• For example, if other CEOs are also selling shares under 10b5-1 plans, it might indicate a broader trend in the industry.
• Analyzing the size of the transactions relative to Arougheti's overall holdings and the company's market capitalization is also important.
• Blackstone CEO Stephen Schwarzman's compensation and stock ownership are often compared to those of other private equity leaders.
• Apollo's executive compensation structure and stock ownership patterns are also relevant benchmarks.

Stakeholder Impact

• Shareholders may react to the CEO's stock sales, potentially impacting the stock price.
• Employees may be indirectly affected by any changes in the company's stock performance.

Key Dates