Victory Capital Holdings, Inc. (NASDAQ: VCTR) has announced a definitive agreement with Amundi, where Amundi will become a strategic shareholder of Victory Capital. As part of this agreement, Victory Capital will be the supplier of US-manufactured active asset management products for Amundi's distribution outside of the US, and will also become the distributor of Amundi's non-US manufactured products in the US.
Upon closing of the transaction, the Amundi US business will be combined into Victory Capital, and Amundi will hold a 26.1% economic stake in Victory Capital. This transaction is expected to be completed late in the 4th quarter of 2024 or in early 2025.
Financially, Victory Capital expects to achieve low-double-digit EPS accretion within a year of closing and anticipates approximately $100 million in annual cost savings, with the majority of these savings expected to be realized within a year of closing.
Additionally, Victory Capital's net leverage ratio is projected to significantly improve upon closing due to higher cash flow and the absence of incurring any incremental debt from the transaction.
In connection with this transaction, PJT Partners and BofA Securities are acting as financial advisors and Willkie Farr & Gallagher LLP is providing legal counsel to Victory Capital.
To further discuss the definitive agreement, Victory Capital will host a conference call on July 9, 2024, at 8:00 a.m. ET, with a live webcast available via the investor relations section of the company’s website. Analysts and investors may also participate in the question-and-answer session during the call.
The strategic partnership with Amundi represents a significant development for Victory Capital, as it not only broadens their investment offerings but also provides a new global distribution channel for their firm. Following these announcements, the company's shares moved 0.3%, and are now trading at a price of $47.3. For the full picture, make sure to review Victory Capital's 8-K report.
