Catching Up With Power Investors Howard Marks and Bruce Flatt

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**Andy Serwer** (0:35)
Hello, everyone, and welcome to At Barrons. I'm Andy Serwer, and welcome to our guest, Bruce Flatt, CEO of Brookfield Corporation, and Howard Marks, co-chairman of Oaktree Capital Management. Bruce Howard, nice to see you. Thank you so much for joining us.

**Howard Marks** (0:48)
Great to be here.

**Bruce Flatt** (0:49)
Thank you.

**Andy Serwer** (0:50)
So Brookfield is the big alternative investment company. Oaktree is also an investment company which is specialized in distress debt. We're talking to both of you because Brookfield now owns Oaktree. Bruce, why don't I start with you? You bought a big piece of Oaktree in 2019 and more recently now, you've bought the entire company.
Why did you buy it in the first place, the piece, and why did you buy the whole thing now?

**Bruce Flatt** (1:16)
Thanks for having us, Andy. And look, I would just say we're in the business of providing backbone infrastructure around the world. And what that really means is we build, own, operate, and lend to the largest groups of infrastructure on the planet. So think railways, and pipelines, and data centers, and AI factories, and transmission lines, and renewable power, and all of those backbone infrastructure.
And seven years ago, we had equity strategies in all these, and small funds where we could provide lending. And we looked around the world and said, if we were going to get there and achieve excellence for our clients, what we needed to do was to have the best in credit. And it was going to take us a long time to get there. And we approached Howard to bolt Oaktree underneath Brookfield. And he agreed to do that. But we did it in a very special way, which was it took us seven years to slowly assimilate what we wanted to assimilate, and leave our investment teams decentralized down below. And we're now bringing the whole thing together. And there's a few things our clients will be advantaged by, by having together, but largely we've had seven years to test everything out, and everything's now running very effectively. And now we have credit in scale that we can provide to our clients. And that's really the reason for doing it, and it's been a great success.

**Andy Serwer** (2:50)
Martin Howard, let me turn to you and ask you sort of a similar question, but why did you sell, and how's it going? How's the partnership going?

**Howard Marks** (2:58)
Well, the partnership is going extremely well.
It has been marked by mutual respect, cooperation, helpfulness, but Bruce used the term decentralized. You know, Brookfield is not a control freak, and in particular has not inserted itself in our investment process, which to us and to our clients was the most important thing. But Brookfield has given us additional resources that help us do a better job. And in particular, we were attracted to Brookfield's nature as not just a third-party investment manager, but also as a proprietary owner of assets for its own interests, and thus a capital-rich company. And with Brookfield's contribution in particular, we have been able to put more capital into our own strategies, which I think strengthens the alignment of interest between us and our clients and redounce to their benefit.

**Andy Serwer** (4:11)
Sounds like you're going to keep the brand name Oaktree.

**Howard Marks** (4:14)
Yes.

**Andy Serwer** (4:15)
Okay. So you guys are two very well-known, prominent, successful investors.
How much do you talk to each other? Do you work together and discuss ideas? Or is it just management? First of you, Howard.

**Howard Marks** (4:27)
Well, I joined the Brookfield Board at the beginning of this process, and that was just over six years ago. And so I've been involved in that way since then. And I give Bruce my ideas and vice versa. We don't have an in-the-weeds working relationship.
Other people share ideas at the senior level just below us and have more of a day-to-day relationship.

**Andy Serwer** (5:05)
What about you?

**Bruce Flatt** (5:06)
What do you think? So I would say with a trillion, three of things around the world, that would be investments or assets or dollars? Total assets.

**Andy Serwer** (5:17)
Okay.

**Bruce Flatt** (5:18)