Ares Replaces Pop-Tarts Purveyor Kellanova on S&P 500

Ares Management just joined the S&P 500 club and is already reaping the benefits of membership. The alternative asset manager’s stock got a 7.27% boost on Tuesday as investors digested its new street cred. 

The S&P Dow Jones Indices announced Monday that Ares would replace Kellanova — owner of pantry favorites like Pringles, Pop-Tarts and Cheez-It — before the market opens on Thursday. The switch-up comes as fellow food company Mars is set to complete a $36 billion acquisition of Kellanova.

Private Credit Boom

Ares’s welcome to the index comes after an initial snub. Last week, S&P Dow Jones Indices announced that building materials provider CRH, online used-car dealer Carvana, and heating, ventilation, and air conditioning company Comfort Systems USA would join the S&P 500 in its quarterly rebalance. They replace automotive equipment provider LKQ, flooring supplier Mohawk Industries and specialty chemicals company Solstice Advanced Materials, which was recently spun off from Honeywell. 

Ares, which has roughly $596 billion of assets under management, will now beat those newcomers — who are set to join the index Dec. 22 — into a much-coveted spot in the large-cap equities gauge. Companies must meet certain criteria to join the index, including having a market capitalization of at least $22.7 billion, but the ultimate decision is with the index committee. 

Ares is a major player in the private-credit market, which is facing both a surge in popularity and mounting concerns: 

• Morgan Stanley estimates the size of the private credit market at $3 trillion at the start of 2025 (up from $2 trillion in 2020) and expects it to reach $5 trillion by 2029. Morningstar senior equity analyst Greggory Warren wrote last month that larger players like Ares should have some advantages in the space amid high customer demand for alternative assets and investors’ efforts to limit the number of providers they use. 
• Still, experts are worried about the risk, illiquidity and opaque lending standards that private markets bring to the financial system. 

Beating Rivals: With its ascension to the S&P 500, which means that funds tracking the index will buy up the company’s shares, Ares ended the trading day Tuesday by paring its year-to-date losses to just 1.47%. Competitors KKR and Blackstone have tumbled closer to 9% and 10% year-to-date, respectively.