Private equity firm Genstar Capital is set to sell asset manager First Eagle Investment Management to Victory Capital in a transaction valuing the business at approximately $7bn, according to a report by the Wall Street Journal.
The deal will see Victory Capital pay around $4.4bn in cash and issue approximately $2bn of its own shares to the sellers. The buyer will also assume $575m of First Eagle’s existing 7.25% senior secured notes, due in 2032.
Genstar, which owns First Eagle alongside the asset manager’s employees, is expected to retain a significant stake in the enlarged Victory Capital following completion. The transaction is scheduled to close by the end of the first quarter of 2027, subject to customary conditions and approvals.
Following completion, Genstar is expected to hold approximately 14.6% of Victory Capital on a fully diluted, as-converted basis, although its voting interest will be capped at 4.9%. Genstar will also have the right to appoint two directors to Victory Capital’s expanded 11-member board.
The transaction gives Victory Capital access to First Eagle’s approximately $222bn in assets under management, while expanding its investment capabilities and distribution reach.
First Eagle will operate on Victory Capital’s platform following the acquisition but is expected to retain its existing brand, investment autonomy and investment processes.
The enlarged business is expected to generate approximately $3.2bn in annual revenue.
