Amundi agreed to sell its $104 billion U.S. business to Victory Capital for a 26.1% stake in the San Antonio-based manager, in a deal that also includes distribution agreements.
Paris-based Amundi, Europe’s largest money manager and one of the largest global firms with €2.04 trillion ($2.17 trillion) in assets under management, said in a joint statement that it had signed a memorandum of understanding with Victory to combine the two businesses. The proposed deal will create a broader U.S. investment platform for clients of both managers, give Amundi access to a wider set of U.S.-managed capabilities, and expand Victory’s worldwide distribution, the statement said.
Victory has $175 billion in total client assets, and operates across 11 affiliate investment managers. Each affiliate retains its investment autonomy and leverages Victory’s centralized operating and distribution platform.
Amundi U.S. runs assets across U.S. and global equity, fixed income and mulitasset.
The proposed deal will see no cash payment involved, only the 26.1% economic stake in Victory Capital. Amundi would become a strategic shareholder in Victory and two of its representatives will join its board of directors upon completion.
Both managers would also enter into 15-year reciprocal distribution agreements, which would see Amundi distribute Victory Capital’s investment strategies outside the U.S., while Victory would distribute Amundi’s non-U.S. manufactured strategies in the U.S.
The deal is expected to be accretive for both firms’ shareholders, the statement said. The firms are working toward a definitive agreement and expect to make a further announcement by the end of the second quarter.
“The proposed transaction with Victory Capital is a unique opportunity to strengthen our presence in the U.S., while becoming a strategic shareholder in a reputable U.S.-based asset management firm with an excellent track record of growth,” said Valerie Baudson, Amundi CEO, in the statement. “It would expand our access to top-performing U.S. investment strategies for the benefit of our clients globally. Additionally, Amundi would greatly benefit from expanded distribution strength in the U.S. market. The combination would provide a significant catalyst for growth for Amundi. Overall, this is a compelling proposition for our clients and our employees; it would also be a value-creating deal for our shareholders with significant prospects for both revenue growth and synergies.”
David Brown, chair and CEO of Victory Capital, added in the same statement that the deal 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. 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.”
The memorandum of understanding is non-binding and subject to regulatory and other approvals.
A spokesperson did not immediately respond to a request for comment.
