Invesco agreed to acquire OppenheimerFunds from Massachusetts Mutual Life Insurance, the companies announced on Thursday, a deal expected to bring Invesco's total assets under management to more than $1.2 trillion.
Under the terms of the agreement, "Invesco will acquire OppenheimerFunds with consideration to MassMutual and OppenheimerFunds employee shareholders consisting of 81.9 million shares of Invesco common equity and $4 billion in perpetual, non-cumulative preferred shares with a 21-year non-call period and a fixed rate of 5.9%," a news release from the companies said.
Of the 81.9 million shares, roughly 6.6 million will be issued "as a part of the post-closing conversion of unvested restricted stock awards, currently held by OppenheimerFunds employee shareholders, into Invesco restricted stock awards," according to the release
MassMutual is expected to own a 15.5% stake in Invesco, making the insurer Invesco's largest shareholder.
"The combination with OppenheimerFunds and the strategic partnership with MassMutual will meaningfully enhance our ability to meet client needs, accelerate growth and strengthen our business over the long term," said Martin L. Flanagan, president and CEO of Invesco in the release.
Mr. Flanagan added the deal will help Invesco expand its capabilities within the U.S. and global markets .
The transaction is expected to close in the second quarter of 2019, pending necessary regulatory and other third-party approvals.