Victory Capital Strikes $7B Deal for First Eagle, Targets $571B in Client Assets

Key Points

• Victory Capital agreed to acquire First Eagle Investments for approximately $7 billion, a transaction expected to raise total client assets to about $571 billion and combined annual revenue to roughly $3.2 billion. Closing is targeted for the end of the first quarter of 2027, pending approvals and other conditions.
• First Eagle would add approximately $222 billion in assets, including global value, municipal bond, small-cap equity, fixed-income and alternative-credit capabilities through Napier Park. The deal would also broaden Victory Capital’s U.S. and international distribution reach while retaining First Eagle’s investment brands and autonomy.
• Victory Capital projects about $280 million in annual expense synergies, full realization within two years and approximately 35% accretion to estimated 2027 adjusted EPS. Pro forma net leverage is expected to be 3.2 times adjusted EBITDA at closing, declining to about two times by the end of 2028.

Victory Capital NASDAQ: VCTR said it has entered into a definitive agreement to acquire First Eagle Investments in a transaction valued at approximately $7 billion, a deal the company expects will expand its assets, investment capabilities and distribution reach.

Upon closing, Victory Capital expects to have approximately $571 billion in total client assets and about $3.2 billion in combined annual revenue. The company said the acquisition is expected to close by the end of the first quarter of 2027, subject to regulatory approvals, client consents and other requirements.

“This is a transformational acquisition for us,” Chairman and Chief Executive Officer David Brown said during a webcast announcing the agreement. Brown said the deal represents the next stage of an acquisition strategy Victory Capital has pursued for more than a decade.

First Eagle Adds $222 Billion in Assets

First Eagle manages approximately $222 billion in assets under management and is expected to generate roughly $1.5 billion in revenue during 2026, according to Victory Capital. The acquired company has recorded positive net flows for each of the past three years and so far in 2026, Brown said.

Victory Capital highlighted First Eagle’s global value multi-asset platform, which manages approximately $135 billion and is organized around downside mitigation across asset classes. The acquisition also would add municipal bond, U.S. small-cap equity, value equity and fixed-income capabilities.

The transaction would further establish Victory Capital in alternatives through First Eagle’s Napier Park business. Napier Park’s collateralized loan obligation business manages approximately $27 billion and operates in the U.S. and Europe, while its alternative-credit operations are diversified across underlying asset classes, investment vehicles and structures.

Brown said First Eagle’s investment teams will retain their brands, investment autonomy and investment processes following the transaction. He said the approach is intended to make the transition seamless for clients.

First Eagle, founded in 1864 and headquartered in New York since 1937, employs 195 investment professionals, according to the presentation. Victory Capital said 92% of First Eagle’s rated mutual fund and ETF assets were in strategies carrying overall Morningstar ratings of four or five stars as of July 31, 2026.

Broader Distribution and More Diversified Platform

The company said the transaction would broaden its presence across U.S. intermediary, U.S. institutional and international distribution channels. First Eagle’s products are used by approximately 103,000 U.S. financial advisers and roughly 3 million end investors, Brown said. The firm also reaches 83% of Barron’s Top 1,500 financial advisers and serves about 740 institutional clients globally.

Both companies already work with French asset manager Amundi in international markets. Brown said Victory Capital intends to build on its existing strategic distribution relationship with Amundi using a broader set of investment products after closing.

On a pro forma basis, no single asset class would account for more than 27% of the combined company’s business, according to Victory Capital. Brown said that diversification should make the company “stronger” and “more durable” across varying market environments and cycles.

Synergies, Financing and Leverage

President, Chief Financial Officer and Chief Administrative Officer Michael Policarpo said Victory Capital expects approximately $280 million in annual net expense synergies on a full run-rate basis. The company expects to fully realize those savings within two years of closing, with a substantial portion achieved in the first year.

The projected synergies represent about 27% of First Eagle’s estimated 2027 expense base, Policarpo said. He added that Victory Capital has not incorporated revenue synergies into its earnings accretion forecast.

Victory Capital expects the acquisition to be approximately 35% accretive to its estimated 2027 adjusted earnings per share, including the anticipated full run-rate expense synergies. Policarpo said the company expects the transaction to close late enough in the first quarter of 2027 that the 2027 accretion measure is the relevant comparison period.

• Approximately $2 billion of consideration will be paid through newly issued Victory Capital equity.
• Victory Capital will assume about $575 million of First Eagle senior secured notes carrying a 7.25% coupon.
• The remaining consideration will be paid in cash.
• Committed financing includes a new $3.5 billion term loan B, about $950 million in new secured notes and an increase in the company’s revolving credit facility to $200 million from $100 million.

Genstar, which will receive approximately 14.6% of Victory Capital’s total economic interest through common stock and non-voting convertible preferred stock, will be subject to a three-year lockup. Its voting interest will be capped at 4.9%. Victory Capital’s board is expected to expand to 11 directors, including two Genstar designees, while Brown will remain chairman and CEO.

Victory Capital expects net leverage of approximately 3.2 times pro forma adjusted EBITDA at closing, inclusive of full run-rate synergies. Policarpo said the company expects leverage to decline to approximately two times by the end of 2028 through the combined company’s free cash flow generation.

About Victory Capital (NASDAQ:VCTR)

Victory Capital NASDAQ: VCTR is a global investment management firm that provides a broad range of strategies across equities, fixed income, multi-asset and alternative investments. Serving institutional, intermediary and retail clients, the company delivers tailored solutions through active, research-driven portfolio management. Its product lineup includes traditional mutual funds, separately managed accounts, sub-advisory services and specialized strategies such as ESG-focused and municipal bond portfolios.

Founded in 1988, Victory Capital has expanded its capabilities via both organic growth and strategic acquisitions, integrating experienced investment teams to enhance its offerings in areas like smart beta, global equity and fixed income.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

Continue following MarketBeat

Add MarketBeat as your preferred source on Google to see our latest stories in your feed.

Add As Preferred Source