Victory Capital (VCTR) M&A announcement summary

Deal rationale and strategic fit

• Acquisition creates a $571 billion diversified global asset manager with expanded scale, product breadth, and multi-asset, equity, fixed income, CLO, and alternative credit capabilities.

• Adds $222 billion in AUM, including a $41 billion CLO and alternative credit platform, and differentiated investment teams.

• Expands distribution reach across U.S. intermediary, institutional, and international channels, leveraging partnerships and enhancing client relationships.

• First Eagle retains brand, investment autonomy, and processes, ensuring continuity for clients while leveraging the acquirer's platform.

• Diversifies business across asset classes, with no single class exceeding 27% of AUM, strengthening resilience across market cycles.

Financial terms and conditions

• Total consideration is approximately $7.0 billion, including $4.4 billion in cash, $2.0 billion in newly issued equity at $116.26 per share, and $575 million in assumed senior secured notes.

• Financing includes a $3.5 billion term loan B, $950 million in new secured notes, and an upsized revolving credit facility.

• Genstar will receive 14.6% economic interest (fully diluted), with voting capped at 4.9% and a three-year lockup; board expands to 11 directors, including two from Genstar.

• Expected net leverage at closing is 3.2x pro forma adjusted EBITDA, declining to 2x by end of 2028.

• Combined annual revenue projected at $3.2 billion.

Synergies and expected cost savings

• Projected $280 million in net expense synergies, representing 14% of the combined expense base and 27% of First Eagle's expense base, fully realized within two years of closing.

• Synergies are a byproduct of strategic fit, not the primary driver, and exclude revenue synergies.

• Accretion to adjusted EPS expected to be approximately 35% by 2027, inclusive of full run-rate synergies.