v3.26.1
Acquisition
 6 Months Ended
Jun. 30, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Acquisition
3. Acquisition
Peppertree Acquisition
On July 1, 2025 (the “Peppertree Acquisition Date”), the Company and certain of its affiliated entities completed the acquisition (the “Peppertree Acquisition”) of the business of Peppertree Capital Management, Inc. (“Peppertree”) pursuant to the terms and conditions set forth in the transaction agreement (the “Peppertree Transaction Agreement”), as amended May 28, 2025, with Peppertree and certain affiliated entities and equity holders thereof (together with Peppertree, the “Peppertree Parties”), a specialized digital infrastructure investment firm with a focus on wireless communications towers.
As a result of the Peppertree Acquisition, the Company expanded its platform diversity, with Peppertree’s alternative investment focus in wireless communications towers and related critical communication infrastructure assets.
The Company accounted for the Peppertree Acquisition as a business combination under ASC 805, with assets acquired and liabilities assumed recorded at fair value as of July 1, 2025, subject to adjustments for provisional amounts through the measurement period, which is limited to one year from the Peppertree Acquisition Date.
Pursuant to the Peppertree Transaction Agreement, the Company acquired Peppertree for both cash and non-cash consideration under U.S. GAAP equal to $389.6 million (“Peppertree Purchase Price”) as described below. The following table summarizes the fair value of amounts recognized for the assets acquired and liabilities assumed and resulting goodwill as of the Peppertree Acquisition Date (in thousands):
July 1, 2025
Purchase Price
Cash(a)
$235,659 
Nonvoting Class A common stock(b)
153,973 
Total Purchase Price$389,632 
Recognized amounts of identifiable assets acquired and liabilities assumed
Cash and cash equivalents$505 
Due from affiliates2,933 
Investments561,945 
Right-of-use asset1,577 
Intangible assets248,900 
Other assets1,502 
Total assets817,362 
Accounts payable and accrued expenses23,006 
Accrued performance allocation compensation403,052 
Operating lease liability1,577 
Other liabilities4,455 
Total liabilities432,090 
Assets acquired/liabilities assumed385,272 
Total Purchase Price389,632 
Non-controlling interest of Peppertree57,749 
Goodwill$62,109 
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(a)Cash consideration includes $2.5 million held in escrow on behalf of the sellers.
(b)Represents the fair value of approximately 2.9 million shares of nonvoting Class A common stock issued to certain Peppertree Parties upon consummation of the Peppertree Acquisition. The fair value of the shares of nonvoting Class A common stock was based on a $52.84 closing price for the shares of Class A common stock on the Peppertree Acquisition Date.
Pursuant to the terms of the Peppertree Transaction Agreement, the Company granted 5.4 million Common Units of TPG Operating Group (including an equal number of shares of Class B common stock of the Company) and 0.3 million restricted stock units of the Company to certain Peppertree Parties, which are deemed to be compensatory under U.S. GAAP and are not part of the Purchase Price. Additionally, certain Peppertree Parties will be entitled to an earnout payment of up to $300.0 million (the “Peppertree Earnout Payment”) upon the satisfaction of certain fee-related revenue and fundraising targets by Peppertree, payable, at the Company’s election and subject to certain limitations set forth in the Peppertree Transaction Agreement, in cash, Common Units (including an equal number of shares of Class B common stock) or a combination thereof. The Peppertree Earnout Payment is treated as post-combination compensation expense, as services are required from such Peppertree Parties post-closing. See Note 14 to the Condensed Consolidated Financial Statements for details.
The total Purchase Price was allocated to the fair value of assets acquired and liabilities assumed as of the Peppertree Acquisition Date, with the excess Purchase Price recorded as goodwill. A third-party valuation specialist assisted the Company with the fair value estimates for the assets acquired and liabilities assumed. The Company recorded $62.1 million of goodwill as of the Peppertree Acquisition Date. Goodwill is primarily attributable to the scale, skill sets, operations and expected synergies that can be achieved subsequent to the Acquisition. The goodwill recorded is not deductible for tax purposes.
The fair value and weighted average estimated useful lives of the acquired identifiable intangible assets as of the Peppertree Acquisition Date consist of the following (in thousands):
Fair ValueValuation MethodologyEstimated Average Useful Life (in years)
Management contracts$181,700 
Multi-period excess earnings method ("MPEEM")
4-9
Contractual performance fee allocations65,200 Discounted cash flow analysis6
Trade name2,000 Relief from royalty method4.5
Fair value of intangible assets acquired$248,900 
The Company recognized $3.0 million and $11.9 million in acquisition-related costs during the three and six months ended June 30, 2025, respectively. These costs are included within general, administrative and other expenses in the Condensed Consolidated Statements of Operations.
The following unaudited pro forma information presents a summary of the Company’s Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2025, as if the acquisition was completed as of January 1, 2024 (in thousands):
Three Months Ended June 30,Six Months Ended June 30,
2025
Revenues$975,896 $2,051,773 
Net income attributable to TPG Inc./controlling interest10,220 32,171 
These pro forma amounts have been calculated after applying the following material adjustments that were directly attributable to the Peppertree Acquisition:
•adjustments to include the impact of the additional amortization that would have been recorded assuming the fair value adjustments to intangible assets had been applied on January 1, 2024;
•adjustments to include additional equity-based compensation expense related to Common Units and restricted stock units issued to Peppertree Parties, as if the grants occurred on January 1, 2024;
•adjustments for changes in the performance allocation compensation to Peppertree Parties in connection with the Peppertree Acquisition; and
•adjustments to include transaction costs in net income as if the Peppertree Acquisition occurred on January 1, 2024.