Form 4: Amundi Increases Stake in Victory Capital Holdings Following Contribution Agreement

Amundi reports increased beneficial ownership in Victory Capital Holdings due to a post-closing adjustment related to a contribution agreement.

Summary

• Amundi Asset Management S.A.S. and Amundi S.A. (collectively, the 'Reporting Persons') filed a Form 4 regarding their beneficial ownership in Victory Capital Holdings, Inc.
• On April 1, 2025, Amundi AM contributed all equity interests of Amundi Holdings US, Inc. to Victory Capital in exchange for 3,293,471 shares of Common Stock and 14,305,982 shares of non-voting convertible Preferred Stock.
• On May 16, 2025, Amundi AM acquired an additional 5,436,318 shares of Preferred Stock due to a post-closing adjustment.
• As of May 16, 2025, Amundi AM beneficially owns 26.1% of Victory Capital's outstanding capital stock on a fully diluted basis, subject to further post-closing adjustments.
• The Reporting Persons have entered into a Shareholder Agreement restricting the transfer of Common Stock and Preferred Stock until April 1, 2028, with certain exceptions.
• Amundi AM has the right to nominate two individuals to Victory Capital's board of directors as long as they own at least 50% of the shares acquired through the Contribution Agreement, and one individual if they own at least 33% but less than 50%.
• The Preferred Stock is not convertible at the option of the holder but is convertible under specific transfer conditions.
• Amundi AM has also entered into Voting Agreements with Crestview and certain officers and employees of Victory Capital.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive. Amundi's increased stake and board representation suggest confidence in Victory Capital. However, the transfer restrictions and specific conversion terms introduce some limitations.

Positives

• Amundi's increased stake demonstrates confidence in Victory Capital's future.
• The Shareholder Agreement provides stability by restricting share transfers until April 1, 2028.
• Amundi's board nomination rights ensure influence over Victory Capital's strategic direction.

Negatives

• The transfer restrictions on the shares until April 1, 2028, could limit Amundi's flexibility.
• The Preferred Stock's limited convertibility might reduce its attractiveness to some investors.

Risks

• Further post-closing adjustments could impact Amundi's ownership percentage.
• The terms of the Shareholder Agreement and Voting Agreements could create conflicts of interest.
• Changes in regulations or market conditions could affect the value of Victory Capital's stock.

Future Outlook

The document indicates potential for further post-closing adjustments to Amundi's ownership. Amundi's influence on Victory Capital's board will continue as long as they maintain a significant ownership stake.

Industry Context

This announcement reflects a strategic investment by Amundi, a major global asset manager, in Victory Capital, a US-based asset management firm. Such investments are common in the asset management industry as firms seek to expand their reach and capabilities.

Comparison to Industry Standards

• BlackRock, a global investment management corporation, commonly acquires minority or majority stakes in other asset management firms to expand its product offerings and geographic reach.
• Similar to the Amundi-Victory Capital deal, such transactions often involve agreements regarding board representation and voting rights, ensuring the investor has a say in the company's strategic direction.
• The share transfer restrictions are also common in such deals to ensure stability and alignment of interests between the investor and the company.

Stakeholder Impact

• Shareholders: Potential positive impact due to Amundi's increased investment and confidence.
• Employees: No immediate impact, but potential long-term effects based on Amundi's influence.
• Customers: No immediate impact, but potential changes in investment strategies or product offerings.
• Suppliers: No immediate impact.
• Creditors: No immediate impact.

Next Steps

• Potential further post-closing adjustments to Amundi's ownership.
• Continued board representation by Amundi nominees.
• Monitoring of share transfer restrictions until April 1, 2028.

Key Dates

Keywords

Victory Capital Holdings, Amundi, Beneficial Ownership, Preferred Stock, Common Stock, Shareholder Agreement, Voting Agreement, Form 4, Contribution Agreement