Victory Capital and Amundi announced this week that they have signed a Memorandum of Understanding to combine Amundi US into Victory Capital, for Amundi to become a strategic shareholder of Victory Capital, and to establish long-term global distribution agreements.
The proposed transaction would create a broader US investment platform for clients of both firms, provide Amundi with access to a wider set of US-managed capabilities, and expand worldwide distribution for San Antonio-based Victory Capital.
The deal would benefit clients of both firms with a broader range of asset classes including actively managed fixed income, equity, and multi-asset investment strategies offered through a variety of investment vehicles including separately managed accounts, ETFs, mutual funds, UCITs, collective investment trusts, and model portfolios.
“This transaction would benefit the clients, employees, and shareholders of both organizations. Strategically, bringing the Amundi U.S. business on to our platform increases our size and scale, adds new investment capabilities, and further strengthens our U.S. distribution with the addition of new talent and relationships,” said David Brown, Chairman and CEO of Victory Capital.
“At the same time, the distribution agreement would immediately position our products for success through Amundi’s extensive and effective distribution channels throughout the world. Financially, the transaction would create shareholder value, be accretive to earnings, and increase our financial flexibility,” Brown added. “Moreover, having Amundi as a strategic shareholder in our firm would strengthen our alignment on the distribution agreement and establish the foundation for an enduring and mutually beneficial long-term relationship.”
“Strategically, bringing the Amundi U.S. business on to our platform increases our size and scale, adds new investment capabilities, and further strengthens our U.S. distribution with the addition of new talent and relationships.”
Victory Capital Chairman and CEO David Brown
Under the proposed transaction, Amundi US would be combined into Victory Capital in exchange for a 26.1% economic stake for Amundi in Victory Capital, with no cash payment involved. Amundi would become a strategic shareholder of Victory Capital with two of its representatives joining the Victory Capital Board of Directors when the transaction closes. Both parties would simultaneously enter into 15-year reciprocal distribution agreements.
Victory Capital is a fast growing, diversified asset management firm with $175bn of total client assets, and a proven acquisition track record. The company’s differentiated platform preserves the investment autonomy of a variety of independent investment teams, all of whom leverage the benefits of a fully integrated, centralized operating and distribution platform.
Amundi US currently manages $104bn of assets across a broad array of asset classes, including US and global equity, fixed income and multi-asset investment capabilities for individuals and institutions worldwide. Amundi US leverages Amundi’s expansive international distribution footprint, managing a significant amount of assets and portfolios on behalf of non-US retail and institutional clients.
The addition of Amundi US as Victory Capital’s largest Investment Franchise would meaningfully enhance Victory Capital’s scale, expand its global client base, and further diversify its investment capabilities, given Amundi US’s broad investment capabilities and strong long-term investment performance.
The parties are working toward definitive agreement, which is expected to be announced by the end of the second quarter.
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