Robert L. Johnson Making History Again: Billionaire Plans To Create The Largest Asset Management Company Owned, Controlled, And Directed By African-Americans

By Tanya Kersey

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Robert L. Johnson, the founder of Black Entertainment Television, has announced that he has signed a letter of intent with Deutsche Asset Management ("DeAM"), the asset management division of Deutsche Bank AG, to form and operate an asset management company with an initial focus on hedge fund of funds products. The new venture will seek to provide investment products and services to public and private pension funds and other institutional investors.

The RLJ Companies, Mr. Johnson's holding company, will form the new company with the goal of becoming the largest asset management company owned, controlled, and directed by African-Americans. DeAM will serve as a minority investor and as a provider of investment strategies and expertise for the joint venture.

"This alliance will help us significantly grow the more than $800 million in assets The RLJ Companies has under management including the $315 million RLJ Urban Lodging Fund," said Bob Johnson, founder and Chairman of The RLJ Companies. "Through this strategic relationship with Deutsche Asset Management, The RLJ Companies will also have a platform to target public and private pension funds as well as other institutional investors with strategic, absolute-return investment vehicles."

In addition to offering hedge fund of funds products, The RLJ Companies will also have a platform to market traditional asset management products utilizing the investment services and expertise of DeAM. A hedge fund of funds invests in a number of individual hedge funds (or "single manager" funds) in order to seek diversification across a number of different investment strategies and styles.

Johnson retired from BET earlier this year, stepping down as CEO and turning over the reins to the company to president and CEO Debra Lee. Johnson sold BET to Viacom in 2001 for $3 billion.

In an interview with The Hollywood Reporter, the billionaire mogul said he won't forget his entertainment industry ties and could look for potential opportunities there in the future. "I still think there ought to be an African American-controlled movie company," he said when asked where he saw unserved markets in the entertainment sector. "If no one else fills that need, maybe I will have to do it," he added, even though he signaled he had no current plans in this area.

Johnson's holding company, The RLJ Companies, provides strategic investment and direction in and for a diverse portfolio of companies in the financial services, real estate, hospitality/restaurant, professional sports, film production, gaming and recording industries. An innovative business network, The RLJ Companies seeks to target undiscovered or underserved markets, then exercise solid management and achieve results.

The RLJ Companies' core businesses include: RLJ Development, a privately held hotel real estate investment company, the RLJ Urban Lodging Fund with $315 million under management from public and private pension fund investors, and a private equity real estate fund which together make up more than $800 million in assets under management; Rollover Systems, a financial services company providing retirement plan rollover services; NBA Charlotte Bobcats, WNBA Charlotte Sting and Charlotte Arena Operations; Caribbean Gaming and Entertainment (C.A.G.E.), with entertainment and nightclub venues in the Caribbean; and Three Keys Music, a jazz recording company.

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