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THE EQUITABLE, ALLIANCE CAPITAL AND EQUITABLE CAPITAL ANNOUNCE AGREEMENT IN PRINCIPLE ON TWO INVESTMENT UNITS

 NEW YORK, Jan. 26 /PRNewswire/ -- The Equitable Companies Incorporated (NYSE: EQ), Alliance Capital Management L.P. (NYSE: AC), and Equitable Capital Management Corporation today announced an agreement in principle under which the business of Equitable Capital will be transferred to Alliance Capital. This transaction will create one of the largest asset management organizations in the U.S., with total assets under management of nearly $100 billion.
 Alliance Capital is 55 percent owned by The Equitable. Equitable Capital is a wholly owned subsidiary of The Equitable.
 Under the terms of the proposed transaction, the business of Equitable Capital will be transferred to Alliance Capital in exchange for 6.25 million newly issued Units in Alliance Capital. The transaction has a value of up to approximately $250 million. This amount includes additional Units having a value of up to $25 million, which may be issued in subsequent years to The Equitable -- subject to an "earn-out" arrangement -- to reflect certain incentive fee performance generated by Equitable Capital's assets under management.
 The Equitable also will purchase $50 million in newly issued Alliance Capital Units to provide for working capital and other needs of Alliance Capital.
 Alliance Capital believes that the proposed transaction will be additive to earnings per Unit within the first year of the closing of the proposed transaction. Alliance Capital will not incur any indebtedness in conjunction with this transaction.
 Upon completion of these transactions, Equitable's ownership of Alliance Capital will increase up to approximately 65 percent. The transaction will result in substantial additions to The Equitable's statutory capital.
 "This transaction between two successful investment management companies will demonstrate the previously unrecognized value of Equitable Capital, which was carried on The Equitable's books at approximately $30 million at the end of September 1992," said Richard H. Jenrette, chairman and chief executive officer, Equitable Companies Incorporated. "In addition, the transaction will result in significant operating efficiencies and a more coordinated approach to the sale of mutual funds by our agency force," Mr. Jenrette continued.
 The transaction is subject to execution of definitive agreements and to boards of director approvals, delivery of fairness opinions, an Alliance Capital Unitholder vote, certain consents and regulatory approvals, and certain other closing conditions. The transfer of Equitable Capital accounts is also subject to client approval.
 Alliance Capital is a diversified global investment adviser, and is one of the leading managers in the U.S. of tax-exempt and public retirement funds. It is also a major manager of individual assets through a broad line of mutual funds. At Sept. 30, 1992, assets under management totaled approximately $62 billion.
 Equitable Capital is a full-service investment management and advisory firm, specializing in corporate finance, fixed income and equity management. Assets under management were $35 billion at Sept. 30, 1992.
 The Equitable Companies Incorporated is one of the world's premier investment managers through products distributed by its primary businesses, which include The Equitable Life Assurance Society of the U.S., Donaldson, Lufkin & Jenrette and Equitable Real Estate Investment Management Inc., in addition to Alliance Capital and Equitable Capital. Total assets under management at The Equitable exceed $150 billion.
 -0- 1/26/93
 / CONTACT: Nancy M. Amiel, 212-554-4293, or investors, Greg Wilcox, 212-554-2595, both of Equitable; or media & investors, Linda Finnerty, 212-969-1316, of Alliance Capital; or Benji Baer, 212-382-8061, of Equitable Capital/
 (EQ AC)


CO: Equitable Companies Incorporated; Alliance Capital Management L.P.;
 Equitable Capital Management Corporation ST: New York IN: FIN SU:


LR -- NY089 -- 9170 01/26/93 14:47 EST
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Publication:PR Newswire
Date:Jan 26, 1993
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