Victory Capital and Amundi Execute Definitive Agreement to Become Strategic Partners

About this update from Victory Capital Holdings, Inc. Class A Common Stock

[{"type":"text","content":" SAN ANTONIO--(BUSINESS WIRE)--\nVictory Capital Holdings, Inc. (NASDAQ: VCTR) (“Victory Capital” or the “Company”) today announced that it has reached a definitive agreement with Amundi (“Amundi”), for their previously announced transaction.\n\n\nConsistent with the Memorandum of Understanding announced on April 16, 2024, Amundi and Victory Capital have entered into reciprocal 15-year distribution agreements which will be effective upon closing of the transaction, the Amundi US business (formerly Pioneer Investments) will be combined into Victory Capital, and Amundi will become a strategic shareholder of Victory Capital.\n\n\nDavid Brown, Chairman and Chief Executive Officer said: “This strategic relationship accelerates the globalization of our firm through a new global distribution channel. The transaction’s structure is carefully designed to closely align our common interests.”\n\n\nUnder the distribution agreements, Victory Capital will be the supplier of US-manufactured active asset management products for Amundi’s distribution outside of the US. Additionally, Victory Capital will become the distributor of Amundi’s non-US manufactured products in the US.\n\n\n“In addition, combining the Amundi US business onto our platform will provide important strategic benefits,” Brown added. “It will broaden our investment offerings with the addition of new and complementary investment capabilities and will result in a larger and broader US distribution sales and marketing effort and reach.\n\n\n“Financially, we expect to achieve low-double-digit EPS accretion within a year of closing. A majority of the estimated $100 million in annual cost savings is expected to be achieved within a year of closing, with any remaining expense synergies expected to be realized in the following year.”\n\n\nVictory Capital’s net leverage ratio is projected to significantly improve upon closing, as a result of higher cash flow and the absence of incurring any incremental debt from the transaction.\n\n\nTransaction Details\n\n\nUnder the proposed transaction, Amundi US would be combined into Victory Capital in exchange for a 26.1% economic stake in Victory Capital, subject to customary adjustment. Amundi would become a strategic shareholder of Victory Capital with two of its representatives joining the Victory Capital Board of Directors when the transactio...

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