GCM Grosvenor Inc. [GCMG] Filings

10-Q 1 gcm-20240630.htm 10-Q gcm-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________________

FORM 10-Q

__________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-39716

__________________________________

GCM Grosvenor Inc.

(Exact Name of Registrant as Specified in Its Charter)

__________________________________

Delaware

85-2226287

(State or Other Jurisdiction of Incorporation or Organization)

(IRS Employer Identification No.)

900 North Michigan Avenue, Suite 1100

Chicago, IL

60611

(Address of principal executive offices)

(Zip Code)

312-506-6500

(Registrant's telephone number, including area code)

N/A

(Former Name, Former Address and Former Fiscal Year if Changed Since Last Report)

__________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, $0.0001 par value per share	GCMG	The Nasdaq Stock Market LLC
Warrants to purchase shares of Class A common stock	GCMGW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of August 5, 2024, there were 44,574,194 shares of the registrant’s Class A common stock, par value $0.0001 per share, outstanding and 144,235,246 shares of the registrant’s Class C common stock, par value $0.0001 per share, outstanding.

Table of Contents


		Page
Part I - Financial Information
Item 1.	Financial Statements (unaudited)	4
	Condensed Consolidated Statements of Financial Condition as of June 30, 2024 and December 31, 2023	4
	Condensed Consolidated Statements of Income (Loss) for the Three and Six Months Ended June 30, 2024 and 2023	5
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2024 and 2023	6
	Condensed Consolidated Statements of Equity (Deficit) for the Three and Six Months Ended June 30, 2024 and 2023	7
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023	9
	Notes to Condensed Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	48
Item 4.	Controls and Procedures	48

Part II - Other Information
Item 1.	Legal Proceedings	49
Item 1A.	Risk Factors	49
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	49
Item 3.	Defaults Upon Senior Securities	49
Item 4.	Mine Safety Disclosures	49
Item 5.	Other Information	49
Item 6.	Exhibits	50
Signatures		52

BASIS OF PRESENTATION

As used in this Quarterly Report on Form 10-Q, unless as the context requires otherwise, as used herein, references to “GCM,” the “Company,” “we,” “us,” and “our,” and similar references refer collectively to GCM Grosvenor Inc. and its consolidated subsidiaries.

Unless the context otherwise requires, references in this Quarterly Report on Form 10-Q to:

•“AUM” are to assets under management;

•“clients” are to persons who invest in our funds, even if such persons are not deemed clients of our registered investment adviser subsidiaries for purposes of the Investment Advisers Act 1940, as amended;

•“Class A common stock” are to our Class A common stock, par value $0.0001 per share;

•“Class B common stock” are to our Class B common stock, par value $0.0001 per share;

•“Class C common stock” are to our Class C common stock, par value $0.0001 per share;

•“FPAUM” are to fee-paying AUM;

•“GCMG” are to GCM Grosvenor Inc., which was incorporated in Delaware as a wholly owned subsidiary of Grosvenor Capital Management Holdings, LLLP, formed for the purpose of completing the Transaction. Pursuant to the Transaction, Grosvenor Capital Management Holdings, LLLP cancelled its shares in GCM Grosvenor Inc. no longer making GCM Grosvenor Inc. a wholly owned subsidiary of Grosvenor Capital Management Holdings, LLLP;

•“GCM Grosvenor” are to GCMH, its subsidiaries, and GCM, L.L.C.;

•“GCM V” are to GCM V, LLC, a Delaware limited liability company;

•“GCMH” are to Grosvenor Capital Management Holdings, LLLP, a Delaware limited liability limited partnership;

•“GCM Funds” and “our funds” are to GCM Grosvenor’s specialized funds and customized separate accounts;

•“GCMH Equityholders” are to Holdings, Management LLC, Holdings II and GCM Progress Subsidiary LLC;

•“Grosvenor common units” are to units of partnership interests in GCMH entitling the holder thereof to the distributions, allocations, and other rights accorded to holders of partnership interests in GCMH;

•“Holdings” are to Grosvenor Holdings, L.L.C., an Illinois limited liability company;

•“Holdings II” are to Grosvenor Holdings II, L.L.C., a Delaware limited liability company;

•“IntermediateCo” are to GCM Grosvenor Holdings, LLC (formerly known as CF Finance Intermediate Acquisition, LLC), a Delaware limited liability company;

•“Management LLC” are to GCM Grosvenor Management, LLC, a Delaware limited liability company;

•“NAV” are to net asset value;

•“Transaction” are to the transactions contemplated by the Transaction Agreement;

•“Transaction Agreement” are to the definitive transaction agreement, dated as of August 2, 2020, by and among CF Finance Acquisition Corp., a Delaware corporation, IntermediateCo, CF Finance Holdings, LLC, a Delaware limited liability company, GCMH, the GCMH Equityholders, GCMH GP, L.L.C., GCM V and us; and

•“TRA Parties” are to the GCMH LLLP Equityholders, and their successors and assigns with respect to the Tax Receivable Agreement (“TRA”).

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including, but not limited to, statements regarding our future results of operations or financial condition; business strategy and plans; and market opportunity may be forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “forecasts,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to statements regarding our future results of operations and financial position, industry and business trends, equity compensation, business strategy, plans, market growth and our objectives for future operations.

The forward-looking statements in this Quarterly Report on Form 10-Q are only current expectations and predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the historical performance of GCM Grosvenor’s funds may not be indicative of GCM Grosvenor’s future results; risks related to redemptions and termination of engagements; the variable nature of GCM Grosvenor’s revenues; competition in GCM Grosvenor’s industry; effects of government regulation or compliance failures; market, geopolitical and economic conditions, identification and availability of suitable investment opportunities; risks related to the performance of GCM Grosvenor’s investments; and the other important factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023 and other filings with the Securities and Exchange Commission. The forward-looking statements in this Quarterly Report on Form 10-Q are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed as exhibits to this Quarterly Report on Form 10-Q with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained in this Quarterly Report on Form 10-Q.

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

GCM Grosvenor Inc.

Condensed Consolidated Statements of Financial Condition

(In thousands, except share and per share amounts)


	As of
	June 30, 2024		December 31, 2023
	(Unaudited)
Assets
Cash and cash equivalents	$	73,921	$	44,354
Management fees receivable	21,696		24,996
Incentive fees receivable	20,221		27,371
Due from related parties	9,193		13,581
Investments	251,099		240,202
Premises and equipment, net	16,641		7,378
Lease right-of-use assets	43,441		38,554
Intangible assets, net	1,970		2,627
Goodwill	28,959		28,959
Deferred tax assets, net	55,344		58,298
Other assets	21,434		18,623
Total assets	543,919		504,943
Liabilities and Equity (Deficit)
Accrued compensation and benefits	61,644		98,561
Debt	433,836		384,727
Payable to related parties pursuant to the tax receivable agreement	53,800		53,759
Lease liabilities	48,379		41,481
Warrant liabilities	8,756		6,431
Accrued expenses and other liabilities	31,211		31,213
Total liabilities	637,626		616,172
Commitments and contingencies (Note 13)

Preferred stock, $0.0001 par value, 100,000,000 shares authorized, none issued	—		—
Class A common stock, $0.0001 par value, 700,000,000 authorized; 44,560,068 and 42,988,563 issued and outstanding as of June 30, 2024 and December 31, 2023, respectively	4		4
Class B common stock, $0.0001 par value, 500,000,000 authorized, none issued	—		—
Class C common stock, $0.0001 par value, 300,000,000 authorized; 144,235,246 issued and outstanding as of June 30, 2024 and December 31, 2023	14		14
Additional paid-in capital	5,052		1,936
Accumulated other comprehensive income	2,430		2,630
Retained earnings	(35,999)		(32,218)
Total GCM Grosvenor Inc. deficit	(28,499)		(27,634)
Noncontrolling interests in subsidiaries	54,311		59,757
Noncontrolling interests in GCMH	(119,519)		(143,352)
Total deficit	(93,707)		(111,229)
Total liabilities and equity (deficit)	$	543,919	$	504,943

See accompanying notes to Condensed Consolidated Financial Statements.

GCM Grosvenor Inc.

Condensed Consolidated Statements of Income (Loss)

(Unaudited)

(In thousands, except share and per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Revenues
Management fees	$	99,843	$	93,564	$	195,728	$	185,809
Incentive fees	16,037		12,996		26,155		18,811
Other operating income	1,074		1,053		3,937		2,109
Total operating revenues	116,954		107,613		225,820		206,729
Expenses
Employee compensation and benefits	67,955		114,868		167,602		201,092
General, administrative and other	28,164		28,726		53,343		54,505
Total operating expenses	96,119		143,594		220,945		255,597
Operating income (loss)	20,835		(35,981)		4,875		(48,868)
Investment income	1,290		2,109		6,967		8,433
Interest expense	(6,134)		(5,682)		(12,057)		(12,337)
Other income	394		458		947		1,172
Change in fair value of warrant liabilities	(180)		4,895		(2,324)		2,674
Net other income (expense)	(4,630)		1,780		(6,467)		(58)
Income (loss) before income taxes	16,205		(34,201)		(1,592)		(48,926)
Provision for income taxes	3,244		2,050		4,354		2,472
Net income (loss)	12,961		(36,251)		(5,946)		(51,398)
Less: Net income (loss) attributable to noncontrolling interests in subsidiaries	(901)		1,396		401		4,169
Less: Net income (loss) attributable to noncontrolling interests in GCMH	9,062		(42,495)		(13,271)		(59,185)
Net income attributable to GCM Grosvenor Inc.	$	4,800	$	4,848	$	6,924	$	3,618

Earnings (loss) per share of Class A common stock:
Basic	$	0.11	$	0.11	$	0.16	$	0.08
Diluted	$	0.04	$	(0.23)	$	(0.08)	$	(0.32)
Weighted average shares of Class A common stock outstanding:
Basic	44,934,623		43,707,111		44,302,442		43,047,388
Diluted	190,178,273		187,942,357		188,537,688		187,282,634

See accompanying notes to Condensed Consolidated Financial Statements.

GCM Grosvenor Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)

(In thousands)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net income (loss)	$	12,961	$	(36,251)	$	(5,946)	$	(51,398)
Other comprehensive income (loss), net of tax:
Net change in cash flow hedges	(2,585)		6,254		616		511
Foreign currency translation adjustment	(503)		(532)		(1,181)		(590)
Total other comprehensive income (loss)	(3,088)		5,722		(565)		(79)
Comprehensive income (loss) before noncontrolling interests	9,873		(30,529)		(6,511)		(51,477)
Less: Comprehensive income (loss) attributable to noncontrolling interests in subsidiaries	(901)		1,396		401		4,169
Less: Comprehensive income (loss) attributable to noncontrolling interests in GCMH	6,517		(38,074)		(13,636)		(59,216)
Comprehensive income attributable to GCM Grosvenor Inc.	$	4,257	$	6,149	$	6,724	$	3,570

See accompanying notes to Condensed Consolidated Financial Statements.

GCM Grosvenor Inc.

Condensed Consolidated Statements of Equity (Deficit)

(Unaudited)

(In thousands)


	Class A Common Stock		Class C Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests in Subsidiaries		Noncontrolling Interests in GCMH		Total Equity (Deficit)
Balance at March 31, 2024	$	4	$	14	$	4,817	$	(34,201)	$	2,973	$	57,588	$	(132,066)	$	(100,871)

Capital contributions from noncontrolling interests in subsidiaries	—		—		—		—		—		402		—		402
Capital distributions paid to noncontrolling interests	—		—		—		—		—		(2,778)		—		(2,778)


Settlement of equity-based compensation in satisfaction of withholding tax requirements	—		—		(2,358)		—		—		—		(7,807)		(10,165)
Partners’ distributions	—		—		—		—		—		—		(7,969)		(7,969)
Deemed contributions	—		—		—		—		—		—		11,588		11,588
Net change in cash flow hedges	—		—		—		—		(426)		—		(2,159)		(2,585)
Translation adjustment	—		—		—		—		(117)		—		(386)		(503)
Equity-based compensation, equity-classified awards	—		—		2,763		—		—		—		9,126		11,889
Declared dividends	—		—		—		(5,506)		—		—		—		(5,506)
Deferred tax and other tax adjustments	—		—		(170)		—		—		—		—		(170)
Equity reallocation between controlling and non-controlling interests	—		—		—		(1,092)		—		—		1,092		—
Net income (loss)	—		—		—		4,800		—		(901)		9,062		12,961
Balance at June 30, 2024	$	4	$	14	$	5,052	$	(35,999)	$	2,430	$	54,311	$	(119,519)	$	(93,707)

	Class A Common Stock		Class C Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests in Subsidiaries		Noncontrolling Interests in GCMH		Total Equity (Deficit)
Balance at December 31, 2023	$	4	$	14	$	1,936	$	(32,218)	$	2,630	$	59,757	$	(143,352)	$	(111,229)

Capital contributions from noncontrolling interests in subsidiaries	—		—		—		—		—		798		—		798
Capital distributions paid to noncontrolling interests	—		—		—		—		—		(6,645)		—		(6,645)


Settlement of equity-based compensation in satisfaction of withholding tax requirements	—		—		(2,392)		—		—		—		(7,922)		(10,314)
Partners’ distributions	—		—		—		—		—				(15,865)		(15,865)
Deemed contributions	—		—		—		—		—		—		41,590		41,590
Net change in cash flow hedges	—		—		—		—		73		—		543		616
Translation adjustment	—		—		—		—		(273)		—		(908)		(1,181)
Equity-based compensation, equity-classified awards	—		—		5,984		—		—		—		19,932		25,916
Declared dividends	—		—		—		(10,971)		—		—		—		(10,971)
Deferred tax and other tax adjustments	—		—		(476)		—		—		—		—		(476)
Equity reallocation between controlling and non-controlling interests	—		—		—		266		—		—		(266)		—
Net income (loss)	—		—		—		6,924		—		401		(13,271)		(5,946)
Balance at June 30, 2024	$	4	$	14	$	5,052	$	(35,999)	$	2,430	$	54,311	$	(119,519)	$	(93,707)


	Class A Common Stock		Class C Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests in Subsidiaries		Noncontrolling Interests in GCMH		Total Equity (Deficit)
Balance at March 31, 2023	$	4	$	14	$	1,283	$	(29,931)	$	2,747	$	65,863	$	(148,054)	$	(108,074)

Capital contributions from noncontrolling interests in subsidiaries	—		—		—		—		—		694		—		694
Capital distributions paid to noncontrolling interests	—		—		—		—		—		(2,999)		—		(2,999)
Repurchase of Class A common stock	—		—		(257)		—		—		—		(888)		(1,145)

Partners’ distributions	—		—		—		—		—		—		(19,447)		(19,447)
Deemed contributions	—		—		—		—		—		—		63,127		63,127
Net change in cash flow hedges	—		—		—		—		1,420		—		4,834		6,254
Translation adjustment	—		—		—		—		(119)		—		(413)		(532)
Equity-based compensation, equity-classified awards	—		—		570		—		—		—		1,962		2,532
Declared dividends	—		—		—		(5,032)		—		—		—		(5,032)
Deferred tax and other tax adjustments	—		—		(10)		—		—		—		—		(10)
Equity reallocation between controlling and non-controlling interests	—		—		—		(342)		—		—		342		—
Net income (loss)	—		—		—		4,848		—		1,396		(42,495)		(36,251)
Balance at June 30, 2023	$	4	$	14	$	1,586	$	(30,457)	$	4,048	$	64,954	$	(141,032)	$	(100,883)

	Class A Common Stock		Class C Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests in Subsidiaries		Noncontrolling Interests in GCMH		Total Equity (Deficit)
Balance at December 31, 2022	$	4	$	14	$	—	$	(23,934)	$	4,096	$	67,900	$	(142,086)	$	(94,006)

Capital contributions from noncontrolling interests in subsidiaries	—		—		—		—		—		861		—		861
Capital distributions paid to noncontrolling interests	—		—		—		—		—		(7,976)		—		(7,976)


Repurchase of Class A common stock	—		—		(1,003)		—		—		—		(3,475)		(4,478)
Settlement of equity-based compensation in satisfaction of withholding tax requirements	—		—		(848)		—		—		—		(2,946)		(3,794)
Partners’ distributions	—		—		—		—		—		—		(19,447)		(19,447)
Deemed contributions	—		—		—		—		—		—		74,224		74,224
Net change in cash flow hedges	—		—		—		—		85		—		426		511
Translation adjustment	—		—		—		—		(133)		—		(457)		(590)
Equity-based compensation, equity-classified awards	—		—		3,434		—		—		—		11,907		15,341
Declared dividends	—		—		—		(10,134)		—		—		—		(10,134)
Deferred tax and other tax adjustments	—		—		3		—		—		—		—		3
Equity reallocation between controlling and non-controlling interests	—		—		—		(7)		—		—		7		—
Net income (loss)	—		—		—		3,618		—		4,169		(59,185)		(51,398)
Balance at June 30, 2023	$	4	$	14	$	1,586	$	(30,457)	$	4,048	$	64,954	$	(141,032)	$	(100,883)

See accompanying notes to Condensed Consolidated Financial Statements.

GCM Grosvenor Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)


	Six Months Ended June 30,
	2024		2023
Cash flows from operating activities
Net loss	$	(5,946)	$	(51,398)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense	1,277		1,356
Equity-based compensation, equity-classified awards	25,916		15,341
Deferred tax income expense	2,867		672
Other non-cash compensation	350		534
Partnership interest-based compensation	41,590		74,224
Amortization of debt issuance costs	508		547
Amortization of terminated swap	(3,781)		(2,881)

Loss on extinguishment of debt	157		—

Change in fair value of warrant liabilities	2,324		(2,674)
Change in payable to related parties pursuant to tax receivable agreement	41		(5)

Proceeds received from investments	3,700		5,079
Non-cash investment income	(6,967)		(8,433)
Non-cash lease expense	3,734		2,993
Other	271		288
Change in assets and liabilities:
Management fees receivable	3,271		(401)
Incentive fees receivable	7,150		9,248
Due from related parties	4,388		853
Other assets	(3,581)		2,437
Accrued compensation and employee related obligations	(37,321)		(30,980)
Lease liabilities	(1,726)		(3,725)

Accrued expenses and other liabilities	3,460		8,731
Net cash provided by operating activities	41,682		21,806
Cash flows from investing activities
Purchases of premises and equipment	(8,867)		(781)
Contributions/subscriptions to investments	(12,008)		(15,350)
Distributions from investments	4,378		6,660
Net cash used in investing activities	(16,497)		(9,471)
Cash flows from financing activities
Capital contributions received from noncontrolling interests	798		861
Capital distributions paid to partners and member	(15,865)		(19,447)
Capital distributions paid to noncontrolling interests	(7,095)		(7,976)
Proceeds from senior loan issuance	50,000		—
Principal payments on senior loan	(1,000)		(2,000)


Debt issuance costs	(556)		—
Payments to repurchase Class A common stock	—		(4,478)


Settlement of equity-based compensation in satisfaction of withholding tax requirements	(10,314)		(3,794)
Dividends paid	(10,304)		(9,299)
Net cash provided by (used in) financing activities	5,664		(46,133)
Effect of exchange rate changes on cash	(1,282)		(609)
Net increase (decrease) in cash and cash equivalents	$	29,567	$	(34,407)
Cash and cash equivalents
Beginning of period	44,354		85,163
End of period	$	73,921	$	50,756
Supplemental disclosure of cash flow information
Cash paid during the period for interest	$	15,858	$	14,422
Cash paid during the period for income taxes, net	$	3,426	$	2,178
Supplemental disclosure of cash flow information from operating activities
Non-cash right-of-use assets obtained in exchange for new and extended operating leases	$	8,953	$	2,034
Non-cash adjustment to operating lease right-of-use assets from lease modification	$	(265)	$	(827)
Supplemental disclosure of cash flow information from investing activities
Non-cash premises and equipment additions in accrued expenses and other liabilities	$	1,027	$	—
Supplemental disclosure of non-cash information from financing activities
Deemed contributions from GCMH Equityholders	$	41,590	$	74,224
Establishment of deferred tax assets, net related to non-cash activities	$	(476)	$	3
Dividends declared but not paid	$	1,253	$	857

See accompanying notes to Condensed Consolidated Financial Statements.

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)

1. Organization

GCM Grosvenor Inc. (“GCMG”) and its subsidiaries including Grosvenor Capital Management Holdings, LLLP (the “Partnership” or “GCMH” and collectively, the “Company”), provide comprehensive investment solutions to primarily institutional clients who seek allocations to alternative investments such as hedge fund strategies, private equity, real estate, infrastructure and strategic investments. The Company collaborates with its clients to construct investment portfolios across multiple investment strategies in the private and public markets, customized to meet their specific objectives. The Company also offers specialized commingled funds which span the alternatives investing universe that are developed to meet broad market demands for strategies and risk-return objectives.

The Company, through its subsidiaries acts as the investment adviser, general partner or managing member to customized funds and commingled funds (collectively, the “GCM Funds”).

GCMG was incorporated on July 27, 2020 under the laws of the State of Delaware for the purpose of consummating the Transaction and merging with CF Finance Acquisition Corp. (“CFAC”), which was incorporated on July 9, 2014 under the laws of the State of Delaware. GCMG owns all of the equity interests of GCM Grosvenor Holdings, LLC (“IntermediateCo”), formerly known as CF Finance Intermediate Acquisition, LLC until November 18, 2020, which is the general partner of GCMH subsequent to the Transaction. GCMG’s ownership (through IntermediateCo) of GCMH as of June 30, 2024 and December 31, 2023 was approximately 23.6% and 23.0%, respectively.

GCMH is a holding company operated pursuant to the Fifth Amended and Restated Limited Liability Limited Partnership Agreement (the “Partnership Agreement”) dated November 17, 2020, among the limited partners including Grosvenor Holdings, L.L.C. (“Holdings”), Grosvenor Holdings II, L.L.C. (“Holdings II”) and GCM Grosvenor Management, LLC (“Management LLC”) (collectively, together with GCM Progress Subsidiary LLC, the “GCMH Equityholders”).

2. Summary of Significant Accounting Policies

Basis of Presentation

The unaudited Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by GAAP for annual financial statements. In the opinion of management, all necessary adjustments (which consists of only normal recurring items) have been made to fairly present the Condensed Consolidated Financial Statements for the interim periods presented. Results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (“SEC”).

Fair Value Measurements

The Company categorizes its fair value measurements according to a three-level hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are defined as follows:

•Level 1 – Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date;

•Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active; and

•Level 3 – Inputs that are unobservable and require significant management judgment or estimation.

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)

Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available under the circumstances.

The carrying amounts of cash and cash equivalents and fees receivable approximate fair value due to the immediate or short-term maturity of these financial instruments.

Investments

Investments primarily consist of investments in GCM Funds and other funds the Company does not control, but is deemed to exert significant influence, and are generally accounted for using the equity method of accounting. Under the equity method of accounting, the Company records its share of the underlying income or loss of such entities, which reflects the net asset value of such investments. Management believes the net asset value of the funds is representative of fair value. The resulting gains and losses are included as investment income in the Condensed Consolidated Statements of Income (Loss).

The Company’s equity method investments in the GCM Funds investing in private equity, real estate and infrastructure (“GCM PEREI Funds”) are valued based on the most recent available information, which typically has a delay of up to three months due to the timing of financial information received from the investments held by the GCM PEREI Funds. The Company records its share of capital contributions to and distributions from the GCM PEREI Funds within investments in the Condensed Consolidated Statements of Financial Condition during the three-month lag period. To the extent that management is aware of material events that affect the GCM PEREI Funds during the intervening period, the impact of the events would be disclosed in the notes to the Condensed Consolidated Financial Statements.

Certain subsidiaries which hold the general partner capital interest in the GCM Funds are not wholly owned, and as such, the portion of the Company’s investments owned by limited partners in those subsidiaries are reflected within noncontrolling interests in the Condensed Consolidated Statements of Financial Condition.

For certain other debt investments, the Company has elected the fair value option. Such election is irrevocable and is made at the investment level at initial recognition. The debt investments are not publicly traded and are a Level 3 fair value measurement. For investments carried at fair value, the Company records the increase or decrease in fair value as investment income in the Condensed Consolidated Statements of Income (Loss). See Note 5 for additional information regarding the Company’s other investments.

Recently Issued Accounting Standards

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 scopes in entities with a single reportable segment and requires those entities to provide all disclosures required in Topic 280, requires that current annual disclosures about a reportable segment’s profit or loss and assets also be provided in interim periods and requires other various new disclosures. Enhanced reporting requirements for all entities includes disclosure of (1) significant segment expenses, (2) the title and position of the chief operating decision maker (the “CODM”) and (3) how the CODM uses disclosed measure(s) of a segment’s profit or loss in assessing segment performance and allocating resources. This guidance is effective for public entities for fiscal years beginning after December 15, 2023 and for interim periods within fiscal years beginning after December 15, 2024. Companies are required to apply the amendments retrospectively to all prior periods presented in the financial statements and early adoption is permitted. The Company is evaluating this guidance and currently expects that adoption will result in new disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires enhanced income tax disclosure including disclosures of specific categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold, additional disclosures about income taxes paid, and disclosure of pre-tax income or loss from continuing operations disaggregated between domestic and foreign income or loss. This guidance is effective for public business entities for fiscal years beginning after December 15, 2024. Companies should provide the enhanced disclosures on a prospective basis, however retrospective application is

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)

permitted. Early adoption is permitted for annual financial statements that have not yet been issued. The Company is evaluating this guidance and currently expects that adoption will result in enhanced income tax disclosures.

3. Revenues

For the three and six months ended June 30, 2024 and 2023, management fees and incentive fees consisted of the following:


	Three Months Ended June 30,				Six Months Ended June 30,
Management fees	2024		2023		2024		2023
Management fees, net	$	96,497	$	89,730	$	188,449	$	178,668
Fund expense reimbursement revenue	3,346		3,834		7,279		7,141
Total management fees	$	99,843	$	93,564	$	195,728	$	185,809


	Three Months Ended June 30,				Six Months Ended June 30,
Incentive fees	2024		2023		2024		2023
Performance fees	$	4,346	$	269	$	10,333	$	513
Carried interest	11,691		12,727		15,822		18,298
Total incentive fees	$	16,037	$	12,996	$	26,155	$	18,811

The Company recognized revenues of less than $0.1 million during each of the three and six months ended June 30, 2024 and 2023 that was previously deferred.

4. Investments

Investments consist of the following:


	As of
	June 30, 2024		December 31, 2023
Equity method investments	$	239,081	$	228,822
Other investments	12,018		11,380
Total investments	$	251,099	$	240,202

As of June 30, 2024 and December 31, 2023, the Company held investments of $251.1 million and $240.2 million, respectively, of which $52.1 million and $56.1 million were owned by noncontrolling interest holders, respectively. Net income (loss) and cash flow from investments held by noncontrolling interest holders will not be attributable to the Company.

See Note 5 for fair value disclosures of certain investments held within other investments.

5. Fair Value Measurements

The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis and level of inputs used for such measurements as of June 30, 2024 and December 31, 2023:

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)


	Fair Value as of June 30, 2024
	Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	32,573	$	—	$	—	$	32,573
Other investments	—		—		11,779		11,779

Total assets	$	32,573	$	—	$	11,779	$	44,352

Liabilities
Public warrants	$	8,227	$	—	$	—	$	8,227
Private warrants	—		—		529		529
Interest rate derivatives	—		3,027		—		3,027
Total liabilities	$	8,227	$	3,027	$	529	$	11,783


	Fair Value as of December 31, 2023
	Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	10,282	$	—	$	—	$	10,282
Other investments	—		—		11,192		11,192
Total assets	$	10,282	$	—	$	11,192	$	21,474

Liabilities
Public warrants	$	6,042	$	—	$	—	$	6,042
Private warrants	—		—		389		389
Interest rate derivatives	—		7,469		—		7,469
Total liabilities	$	6,042	$	7,469	$	389	$	13,900

Money Market Funds

Money market funds are valued using quoted market prices and are included in cash and cash equivalents in the Condensed Consolidated Statements of Financial Condition.

Interest Rate Derivatives

Management determines the fair value of its interest rate derivative agreements based on the present value of expected future cash flows based on observable future rates applicable to each swap contract using linear interpolation, inclusive of the risk of non-performance, using a discount rate appropriate for the duration. See Note 12 for additional information regarding interest rate derivatives.

Other Investments

Investments in the subordinated notes of a structured alternatives investment solution are not publicly traded and are classified as Level 3. Management determines the fair value of these other investments using a discounted cash flow analysis (“Cash Flow Analysis”), which includes assumptions regarding the expected deployment and realization timing of private investments. The position was classified as Level 3 as of June 30, 2024 and December 31, 2023 because of the use of significant unobservable inputs in the Cash Flow Analysis as follows:

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)

As of June 30, 2024

As of December 31, 2023

Impact to Valuation from an Increase in Input(2)

Significant Unobservable Inputs(1)

Range

Weighted Average

Range

Weighted Average

Discount rate(3)

26.5% – 27.5%

27.0

26.5% - 27.5%

27.0

Decrease

Expected remaining term (years)

8 – 12

N/A

8 – 12

N/A

Decrease

Expected return – liquid assets(4)

4.0% – 5.0%

4.2

2.0% - 5.0%

4.3

Increase

Expected total value to paid in capital – private assets(5)

1.55x – 2.08x

1.86x

1.55x – 2.05x

1.87x

Increase

____________

(1)In determining these inputs, management considers the following factors including, but not limited to: liquidity, estimated yield, capital deployment, diversified multi-strategy appreciation, expected net multiple of investment capital across Private Assets investments, annual operating expenses, as well as investment guidelines such as concentration limits, position size, and investment periods.

(2)Unless otherwise noted, this column represents the directional change in fair value of the Level 3 investments that would result from an increase to the corresponding unobservable input. A decrease to the unobservable input would have the opposite effect.

(3)The discount rate was based on the relevant benchmark rate, spread, and yield migrations on related securitized assets.

(4)Inputs were weighted based on actual and estimated expected return included in the range.

(5)Inputs were weighted based on the actual and estimated commitments to the respective private asset investments included in the range.

The resulting fair values of $11.8 million and $11.2 million were recorded within investments in the Condensed Consolidated Statements of Financial Condition as of June 30, 2024 and December 31, 2023, respectively.

The following table presents changes in Level 3 assets measured at fair value for the three and six months ended June 30, 2024 and 2023:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Balance at beginning of period	$	11,621	$	10,279	$	11,192	$	10,007


Change in fair value	158		411		587		683
Balance at end of period	$	11,779	$	10,690	$	11,779	$	10,690

Public Warrants

The public warrants are valued using quoted market prices on the Nasdaq Stock Market LLC under the ticker GCMGW.

Private Warrants

The private warrants were classified as Level 3 as of June 30, 2024 and December 31, 2023 because of the use of significant unobservable inputs in the valuation, however the overall private warrant valuation and change in fair value are not material to the Condensed Consolidated Financial Statements.

The valuations for the private warrants were determined to be $0.59 and $0.43 per unit as of June 30, 2024 and December 31, 2023, respectively. The resulting fair values of $0.5 million and $0.4 million were recorded within warrant liabilities in the Condensed Consolidated Statements of Financial Condition as of June 30, 2024 and December 31, 2023, respectively. See Note 7 for additional information regarding the warrant activity.

The following table presents changes in Level 3 liabilities measured at fair value for the three and six months ended June 30, 2024 and 2023:

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Balance at beginning of period	$	518	$	609	$	389	$	475

Change in fair value	11		(295)		140		(161)
Balance at end of period	$	529	$	314	$	529	$	314

6. Equity

Shares of Common Stock Outstanding

The following table shows a rollforward of the common stock outstanding for the three and six months ended June 30, 2024 and 2023:


	Three Months Ended June 30, 2024			Six Months Ended June 30, 2024
	Class A common stock	Class B common stock	Class C common stock	Class A common stock	Class B common stock	Class C common stock
Beginning of period	42,996,776	—	144,235,246	42,988,563	—	144,235,246

Net shares delivered for vested RSUs	1,563,292	—	—	1,571,505	—	—

End of period	44,560,068	—	144,235,246	44,560,068	—	144,235,246


	Three Months Ended June 30, 2023			Six Months Ended June 30, 2023
	Class A common stock	Class B common stock	Class C common stock	Class A common stock	Class B common stock	Class C common stock
Beginning of period	41,390,306	—	144,235,246	41,806,215	—	144,235,246

Net shares delivered for vested RSUs	591,422	—	—	591,422	—	—
Repurchase of Class A shares	(148,280)	—	—	(564,189)	—	—
End of period	41,833,448	—	144,235,246	41,833,448	—	144,235,246

As of June 30, 2024, 569,015 RSUs were vested, but not yet delivered, and are therefore not yet included in outstanding Class A common stock. The delivery of vested RSUs will be reduced by the number of shares withheld to satisfy statutory withholding tax obligations as well as RSUs that are settled in cash.

Dividends

Dividends are reflected in the Condensed Consolidated Statements of Equity (Deficit) when declared by the Board of Directors. The table below summarizes dividends declared to date during 2024:

Declaration Date

Record Date

Payment Date

Dividend per Common Share

February 8, 2024

March 1, 2024

March 15, 2024

$0.11

May 6, 2024

June 3, 2024

June 17, 2024

$0.11

August 7, 2024

September 3, 2024

September 17, 2024

$0.11

Dividend equivalent payments of $1.8 million were accrued for holders of RSUs as of June 30, 2024. Distributions to partners represent distributions made to GCMH Equityholders.

Stock Repurchase Plan

On August 6, 2021, GCMG’s Board of Directors authorized a stock repurchase plan which may be used to repurchase shares of the Company’s outstanding Class A common stock and warrants to purchase shares of Class A common stock. Class

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)

A common stock and warrants may be repurchased from time to time in open market transactions, in privately negotiated transactions, including with employees or otherwise, pursuant to the requirements of Rule 10b5-1 and Rule 10b-18 of the Exchange Act, as well as to retire (by cash settlement or the payment of tax withholding amounts upon net settlement) equity-based awards granted under our 2020 Incentive Award Plan, as amended and restated (and any successor plan thereto), with the terms and conditions of these repurchases depending on legal requirements, price, market and economic conditions and other factors. The Company is not obligated under the terms of the plan to repurchase any of its Class A common stock or warrants, the program has no expiration date and the Company may suspend or terminate the program at any time without prior notice. Any shares of Class A common stock and any warrants repurchased as part of this program will be canceled. GCMG’s Board of Directors has made subsequent increases to its original stock repurchase authorization amount for shares and warrants. As of December 31, 2023, the total authorization was $115 million, excluding fees and expenses. On February 8, 2024, GCMG’s Board of Directors increased the firm's existing repurchase authorization by $25 million, from $115 million to $140 million.

During the three and six months ended June 30, 2024, the Company repurchased 3,249,043 and 3,264,513 shares, respectively, for RSUs that were settled in cash, including amounts withheld in connection with the payment of tax withholding obligations, for $30.3 million and $30.5 million, or an average of $9.33 and $9.34 per share, respectively. See Note 10 for additional information regarding RSUs. Other than the deemed repurchases described above, the Company did not repurchase shares of Class A common stock during the three and six months ended June 30, 2024. As of June 30, 2024, the Company had $34.7 million remaining under the stock repurchase plan.

7. Warrants

The public and private warrants meet the definition of a derivative under ASC 815 and the Company records these warrants as liabilities in the Condensed Consolidated Statements of Financial Condition at fair value, with subsequent changes in their respective fair values recorded in the change in fair value of warrant liabilities within the Condensed Consolidated Statements of Income (Loss) at each reporting date.

Each public warrant entitles the registered holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment. The warrants expire 5 years after the consummation of the Transaction, or earlier upon redemption or liquidation. The public warrant holders do not have the rights or privileges of holders of Class A common stock and any voting rights until they exercise their warrants and receive shares of Class A common stock. After the issuance of shares of Class A common stock, upon exercise of the warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by stockholders.

The private placement warrants (including the Class A common stock issuable upon exercise of the private placement warrants) will not be redeemable by the Company so long as they are held by CF Sponsor, Holdings or their permitted transferees. CF Sponsor, Holdings or their permitted transferees, have the option to exercise the private placement warrants on a cashless basis.

No warrants were exercised or repurchased during the three and six months ended June 30, 2024 and 2023. The Company had 16,784,970 of public warrants and 900,000 of private warrants outstanding as of each of June 30, 2024 and December 31, 2023.

8. Variable Interest Entities

The Company consolidates certain VIEs in which it is determined that the Company is the primary beneficiary.

The Company holds variable interests in certain entities that are VIEs which are not consolidated, as it is determined that the Company is not the primary beneficiary. The Company’s involvement with such entities is generally in the form of direct equity interests in, and fee arrangements with, the entities in which it also serves as the general partner or managing member. The Company evaluated its variable interests in the VIEs and determined it is not considered the primary beneficiary of the entities primarily because it does not have interests in the entities that could potentially be significant. No reconsideration events that caused a change in the Company’s consolidation conclusions occurred during either the six months ended June 30, 2024 or the year ended December 31, 2023. As of June 30, 2024 and December 31, 2023, the total unfunded commitments from the special limited partner and general partners to the unconsolidated VIEs were $42.2 million and $42.1 million, respectively. These commitments are the primary source of financing for the unconsolidated VIEs.

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)

The following table sets forth certain information regarding the VIEs in which the Company holds a variable interest but does not consolidate. The assets recognized on the Company’s Condensed Consolidated Statements of Financial Condition relate to the Company’s interests in and management fees, incentive fees and third party costs receivables from these non-consolidated VIEs. The Company’s maximum exposure to loss relating to non-consolidated VIEs as of June 30, 2024 and December 31, 2023 were as follows:


	As of
	June 30, 2024		December 31, 2023
Investments	$	107,027	$	102,109
Receivables	15,879		16,324
Maximum exposure to loss	$	122,906	$	118,433

The above table includes investments in VIEs which are owned by noncontrolling interest holders of approximately $28.7 million and $30.9 million as of June 30, 2024 and December 31, 2023, respectively.

9. Employee Compensation and Benefits

For the three and six months ended June 30, 2024 and 2023, employee compensation and benefits consisted of the following:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Cash-based employee compensation and benefits	$	38,733	$	38,691	$	76,006	$	83,144
Equity-based compensation	5,335		3,815		30,805		29,608
Partnership interest-based compensation	11,588		63,127		41,590		74,224
Carried interest compensation	6,860		7,557		9,402		11,117
Cash-based incentive fee related compensation	5,260		1,728		9,449		2,465
Other non-cash compensation	179		(50)		350		534
Total employee compensation and benefits	$	67,955	$	114,868	$	167,602	$	201,092

Partnership Interest in Holdings, Holdings II and Management LLC

Payments and settlements for partnership interest awards to the employees are made by GCMH Equityholders. As a result, the Company records a non-cash profits interest compensation charge and an offsetting deemed contribution to equity (deficit) to reflect the payments or settlements made or owed by the GCMH Equityholders. Since payments or settlements are made by Holdings, Holdings II and Management LLC, the expense that is pushed down to GCMH and the offsetting deemed contribution are each attributed solely to noncontrolling interests in GCMH. Any liability related to the awards is recognized at Holdings, Holdings II or Management LLC as Holdings, Holdings II or Management LLC is the party responsible for satisfying the obligation, and is not shown in the Company’s Condensed Consolidated Financial Statements. The Company has recorded deemed contributions to equity (deficit) from Holdings, Holdings II and Management LLC of $11.6 million and $63.1 million for the three months ended June 30, 2024 and 2023, respectively, and $41.6 million and $74.2 million for the six months ended June 30, 2024 and 2023, respectively, for partnership interest-based compensation expense which was or will ultimately be paid or settled by Holdings, Holdings II or Management LLC.

GCMH Equityholders have modified awards to certain individuals upon their voluntary retirement or intention to retire as employees. These awards generally include a stated target amount that, upon payment, terminates the recipient’s rights to future distributions and allows for a lump sum buy-out of the awards, at the discretion of the managing member of Holdings, Holdings II, and Management LLC. The awards are accounted for as partnership interest-based compensation at the present value of these expected future payments, in the period the employees accepted the offer. The Company recognized $18.5 million in partnership interest-based compensation expense related to award modifications for the six months ended June 30,

GCM Grosvenor Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(In thousands, except share and per share amounts and where otherwise noted)

2024, and none was recognized for the three months ended June 30, 2024 and each of the three and six months ended June 30, 2023 (other than as discussed for the Holdings Awards below).

The liability associated with awards that contain a stated target has been retained by Holdings as of June 30, 2024 and December 31, 2023 and is re-measured at each reporting date, with any corresponding changes in liability being reflected as employee compensation and benefits expense of the Company. No recipients had unvested stated target payments as of each of June 30, 2024 and 2023. The Company recognized partnership interest-based compensation expense of $2.4 million and $8.5 million for the three months ended June 30, 2024 and 2023, respectively, and $4.8 million and $14.3 million for the six months June 30, 2024 and 2023, respectively, related to profits interest awards that are in substance profit-sharing arrangements.

GCMH Equityholders Awards

In the year ended December 31, 2022, GCMH Equityholders entered into agreements that will transfer equity ownership between certain existing employee members of the GCMH Equityholders (“GCMH Equityholders Awards”). The GCMH Equityholders Awards will entitle recipients to receive Class A common stock upon vesting. The non-cash awards serve to transfer equity ownership from existing GCMH Equityholders to other existing member employees upon vesting. The GCMH Equityholders Awards do not dilute Class A common stockholders and do not impact cash flows of the Company. The GCMH Equityholders Awards are accounted for under ASC 718, Compensation—Stock Compensation. The awards generally will vest in May 2025 and do not entitle the recipients to dividends or distributions made on Class A common stock during the vesting period. As such, the fair value of the GCMH Equityholders Awards is based on the closing price of Class A common stock on the accounting grant date less the present value of dividends expected to be paid during the vesting period. GCMH Equityholders can settle the awards at various dates after vesting by exchanging outstanding GCMH common units or by otherwise acquiring and delivering Class A common stock, and therefore the vesting of such awards will not dilute Class A common stockholders. As such, the expense that is pushed down to GCMH and the offsetting deemed contribution are each attributed solely to noncontrolling interests in GCMH, consistent with the accounting for payments to employees described above. The GCMH Equityholders Awards of 7,169,415 units had an aggregate grant date fair value of $53.4 million, or an average grant date fair value of $7.45 per unit. The Company recognized partnership interest-based compensation expense related to the GCMH Equityholders Awards of $5.5 million for each of the three months ended June 30, 2024 and 2023, and $10.9 million and $10.8 million for the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, total unrecognized compensation expense related to unvested GCMH Equityholders Awards was $18.2 million and is expected to be recognized over the remaining weighted average period of 0.8 years.

Holdings Awards

On May 9, 2023, Holdings entered into amended and restated participation certificates with existing emplo

GCM Grosvenor Inc. [GCMG] Filings
GCM Grosvenor Inc. [GCMGW] Filings
10-Q	[2024-08-08]
10-Q	[2024-05-08]
10-K	[2024-03-01]
10-Q	[2023-11-09]
10-Q	[2023-08-09]
10-Q	[2023-05-10]
10-K	[2023-02-23]
10-Q	[2022-11-09]
10-Q	[2022-08-09]
10-Q	[2022-05-10]
10-K	[2022-02-25]
10-Q	[2021-11-12]
10-Q	[2021-08-12]
10-Q	[2021-05-14]
10-K	[2021-03-12]
S-1	[2020-12-04]
10-Q	[2020-11-20]

GCM Grosvenor Inc. [GCMG] Filings

GCM Grosvenor Inc. [GCMGW] Filings