(Bloomberg) -- Brookfield Asset Management Inc. has agreed to buy a majority stake in Oaktree Capital Group LLC, a combination that would rival Blackstone Group LP as the world’s largest alternative money manager.

Brookfield will acquire a 62 percent stake in Oaktree in a cash and stock deal, according to a statement from the companies on Wednesday. The firms together will have approximately $475 billion of assets under management and $2.5 billion of annual fee-related revenue, the statement said. Blackstone had $472 billion in assets at year end.

The deal brings together two alternative asset managers as the industry has been gathering a near record level of assets. It would bolster the credit business of Brookfield, which has traditionally focused on real estate. The two companies will continue to operate independently, with each keeping its brand and led by existing management. Howard Marks, co-chairman of Oaktree, will join Brookfield’s board. Under the terms of the deal, Brookfield could take over full ownership of Oaktree by 2029.

Oaktree rose as much as 12 percent, the biggest gain since the company went public in 2012. Brookfield fell 0.3 percent at 10:45 a.m. in New York.

“This transaction enables us to broaden our product offering to include one of the finest credit platforms in the world, which has a value-driven, contrarian investment style, consistent with ours,” Brookfield Chief Executive Officer Bruce Flatt said in the statement.

Brookfield, a 120-year-old firm that’s Canada’s largest alternative investment firm, owns companies ranging from real estate to infrastructure and renewable power. Iconic holdings include Manhattan West, the new complex at the Hudson Yards in New York, and Brookfield Place near Wall Street.

In the past year the firm has acquired mall owner GGP Inc. for $13 billion, Forest City Real Estate for $6.7 billion, and power solutions business from Johnson Controls for $13.2 billion.

Shares of Toronto-based Brookfield have been a stellar performer for decades, posting a 21 percent annual return since 2009, double the gain of the S&P/TSX Composite Index, Canada’s main equity gauge.

Los Angeles-based Oaktree was founded in 1995 by Marks, Bruce Karsh and other partners. The firm managed $120 billion in distressed debt, private equity holdings, real estate, infrastructure and other equity assets as of Dec. 31. It had returned 78 percent through Tuesday.

"There are two variables as to why the deal happened,” Bloomberg Intelligence analyst Paul Gulberg said. “One is the credit markets and the other is diversification. All their peers like Blackstone, KKR, they’re all very diversified. They’ve got credit, they’ve got real estate all under one umbrella. Oaktree was predominantly credit and Brookfield was largely real estate and private equity, so it really diversifies both of them."

Perella Weinberg Partners was sole financial adviser and Simpson Thacher & Bartlett and Munger, Tolles & Olsen were legal advisers to Oaktree. Weil, Gotshal & Manges and Torys represented Brookfield.

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