8-K: Pioneer Funds Transition Investment Advisory to Victory Capital Following Amundi US Merger

Pioneer Funds are undergoing a transition in investment advisory services from Amundi US to Victory Capital following a merger, with shareholder approval pending for a new advisory agreement.

Summary

• Effective April 1, 2025, Amundi Asset Management US, Inc. merged with Victory Capital Holdings, Inc.
• As a result, all portfolio managers of Amundi US became employees of Victory Capital.
• The Boards of Directors for Pioneer Floating Rate Fund, Inc., Pioneer Diversified High Income Fund, Inc., Pioneer High Income Fund, Inc., Pioneer Municipal High Income Fund, Inc., Pioneer Municipal High Income Advantage Fund, Inc., and Pioneer Municipal High Income Opportunities Fund, Inc. approved a new investment advisory agreement with Victory Capital.
• Shareholder approval is required for the new advisory agreement, but a sufficient number of proxies have not yet been received.
• The current investment advisory agreement with Amundi US has automatically terminated due to the merger.
• An interim investment advisory agreement with Victory Capital has been approved, effective until shareholder approval of the new agreement or until August 29, 2025 (150 days after April 1, 2025).
• The terms and fees of the interim agreement are substantially the same as the previous agreement with Amundi US.
• Investment advisory fees under the interim agreement will be held in escrow.
• If shareholders do not approve the new agreement by August 29, 2025, the Funds Board will consider other alternatives.
• Shareholders received a proxy statement dated February 10, 2025, regarding the new advisory agreement.

Sentiment

Score: 6

Explanation: The announcement is neutral, outlining a transition in investment advisory services due to a merger. While there is some uncertainty regarding shareholder approval, the interim agreement provides stability.

Positives

• The interim advisory agreement ensures continuity of investment management services for the Funds.
• The terms of the interim agreement are substantially the same as the previous agreement, minimizing disruption.
• Fees are held in escrow, providing a safeguard for shareholders.

Negatives

• Shareholder approval for the new advisory agreement is pending, creating uncertainty.
• The current advisory agreement with Amundi US has terminated automatically.
• If shareholder approval is not obtained by August 29, 2025, the Funds Board will need to consider other alternatives.

Risks

• Failure to obtain shareholder approval for the new advisory agreement could lead to further changes in investment management.
• The Funds Board may need to seek alternative investment advisors if the new agreement is not approved.
• Uncertainty surrounding the advisory agreement could impact investor confidence.

Future Outlook

The Funds are awaiting shareholder approval for the new investment advisory agreement with Victory Capital. If approval is not received by August 29, 2025, the Funds Board will consider other alternatives.

Management Comments

• The Funds Board of Directors unanimously approved a new investment advisory agreement for the Fund with Victory Capital.
• The Funds Board has approved an interim investment advisory agreement with Victory Capital, which will be effective until the earlier of (i) shareholder approval of the New Advisory Agreement; or (ii) 150 days after April 1, 2025.
• In the event shareholders do not approve the New Advisory Agreement by August 29, 2025, the Funds Board will consider other alternatives.

Industry Context

The merger between Amundi US and Victory Capital reflects ongoing consolidation trends in the asset management industry. Investment advisory agreements are subject to shareholder approval to ensure alignment of interests.

Comparison to Industry Standards

• Shareholder approval of investment advisory agreements is a standard practice in the investment management industry, ensuring transparency and accountability.
• The 150-day interim period is a common timeframe for transitioning advisory services while awaiting shareholder approval.
• Holding advisory fees in escrow during the interim period is a prudent measure to protect shareholder interests, similar to practices seen in other fund transitions.

Stakeholder Impact

• Shareholders are awaiting the outcome of the vote on the new advisory agreement.
• Portfolio managers of Amundi US have become employees of Victory Capital.
• The transition aims to minimize disruption to fund operations and investment strategies.

Next Steps

• Continued solicitation of proxies from shareholders to approve the New Advisory Agreement.
• Potential consideration of alternative investment advisors if shareholder approval is not obtained by August 29, 2025.

Key Dates

Keywords

Victory Capital, Amundi US, Investment Advisory Agreement, Shareholder Approval, Interim Agreement, Pioneer Funds, Merger