Victory Capital Holdings, Inc. (NASDAQ: VCTR) (“Victory Capital”
or the “Company”) today announced that its wholly owned operating
subsidiary Victory Capital Management Inc. has reached a definitive
agreement to acquire 100% of New Energy Capital Partners
(“NEC”).
NEC will become Victory Capital’s 11th Investment Franchise and
represents the Company’s first Franchise focusing exclusively on
alternative investments. Founded in 2004 and based in Hanover, New
Hampshire, NEC is a leading alternative asset management firm
focused on debt and equity investments in clean energy
infrastructure projects and companies. The transaction is expected
to close during the fourth quarter of 2021 and be immediately
accretive to Victory Capital’s earnings.
David Brown, Chairman and CEO of Victory Capital, said,
“Launching an alternative investment platform creates an additional
path for future growth. The same principles that have led to
success in our traditional asset management business will guide the
strategy for this part of our business. This includes adding
autonomous Investment Franchises, with excellent investment
performance track records and managing strategies designed to add
value to client portfolios. Our operating and distribution
infrastructure will support these Investment Franchises to allow
them to stay focused on managing assets and serving clients.
“NEC perfectly embodies all of the characteristics we seek, and
we particularly like their specialization in clean and renewable
energy, which is a fast-growing market segment.”
With four active private closed-end funds, NEC is invested
across both debt and equity instruments and has a diverse investor
base of limited partners representing a mix of institutional
investors including endowments, foundations, insurance companies,
pension plans, health systems, government entities and family
offices. With a broadly diversified portfolio of projects, spanning
multiple energy markets and geographic jurisdictions, NEC generates
returns that are uncorrelated with commodity exposure and
traditional energy investments. NEC’s investment process will be
unchanged and allow for continued long-term investment
excellence.
“We are very excited to be partnering with an industry
leader—Victory Capital—to enhance operating support and accelerate
our growth trajectory,” said Scott Brown, Founder and CEO of NEC.
“Following the transaction’s close, we look forward to benefiting
from Victory Capital’s well-established distribution
capabilities.
“Since we launched our first fund 17 years ago, the clean energy
sector has substantially matured. Technology advancements have led
to material declines in production costs and the industry’s
economics have now reached a tipping point. This—coupled with
increasing attention on climate change and rapidly evolving
government standards—bodes well for solar, wind, and hydro
technologies to increase their respective shares of the growing
electrical generation market.”
In 2020, projects funded by NEC offset more than 4.4 million
metric tons of carbon dioxide equivalents. This greenhouse gas
abatement equates to planting more than 73 million trees.
Closing is subject to customary approvals, conditions and
consents. BofA Securities is serving as financial advisor to
Victory Capital, and Willkie Farr & Gallagher LLP is serving as
legal advisor to Victory Capital. UBS is serving as financial
advisor to NEC, and Choate Hall & Stewart LLP is serving as
NEC’s legal advisor.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements may include, without limitation, any
statements preceded by, followed by or including words such as
“target,” “believe,” “expect,” “aim,” “intend,” “may,”
“anticipate,” “assume,” “budget,” “continue,” “estimate,” “future,”
“objective,” “outlook,” “plan,” “potential,” “predict,” “project,”
“will,” “can have,” “likely,” “should,” “would,” “could” and other
words and terms of similar meaning or the negative thereof. Such
forward-looking statements involve known and unknown risks,
uncertainties and other important factors beyond Victory Capital’s
control such as the COVID-19 pandemic and its effect on our
business, operations and financial results going forward, as
discussed in Victory Capital’s filings with the SEC, that could
cause Victory Capital’s actual results, performance or achievements
to be materially different from the expected results, performance
or achievements expressed or implied by such forward-looking
statements.
Although it is not possible to identify all such risks and
factors, they include, among others, the following: reductions in
AUM based on investment performance, client withdrawals, difficult
market conditions and other factors such as a pandemic; the nature
of the Company’s contracts and investment advisory agreements; the
Company’s ability to maintain historical returns and sustain its
historical growth; the Company’s dependence on third parties to
market its strategies and provide products or services for the
operation of its business; the Company’s ability to retain key
investment professionals or members of its senior management team;
the Company’s reliance on the technology systems supporting its
operations; the Company’s ability to successfully acquire and
integrate new companies; the concentration of the Company’s
investments in long-only small- and mid-cap equity and U.S.
clients; risks and uncertainties associated with non-U.S.
investments; the Company’s efforts to establish and develop new
teams and strategies; the ability of the Company’s investment teams
to identify appropriate investment opportunities; the Company’s
ability to limit employee misconduct; the Company’s ability to meet
the guidelines set by its clients; the Company’s exposure to
potential litigation (including administrative or tax proceedings)
or regulatory actions; the Company’s ability to implement effective
information and cyber security policies, procedures and
capabilities; the Company’s substantial indebtedness; the potential
impairment of the Company’s goodwill and intangible assets;
disruption to the operations of third parties whose functions are
integral to the Company’s ETF platform; the Company’s determination
that Victory Capital is not required to register as an "investment
company" under the 1940 Act; the fluctuation of the Company’s
expenses; the Company’s ability to respond to recent trends in the
investment management industry; the level of regulation on
investment management firms and the Company’s ability to respond to
regulatory developments; the competitiveness of the investment
management industry; the dual class structure of the Company’s
common stock; the level of control over the Company retained by
Crestview GP; the Company’s status as an emerging growth company
and a controlled company; and other risks and factors listed under
"Risk Factors" and elsewhere in the Company’s filings with the
SEC.
Such forward-looking statements are based on numerous
assumptions regarding Victory Capital’s present and future business
strategies and the environment in which it will operate in the
future. Any forward-looking statement made in this press release
speaks only as of the date hereof. Except as required by law,
Victory Capital assumes no obligation to update these
forward-looking statements, or to update the reasons actual results
could differ materially from those anticipated in the
forward-looking statements, even if new information becomes
available in the future.
About Victory Capital
Victory Capital is a diversified global asset management firm
with $162.9 billion in assets under management as of July 31, 2021.
The Company operates a next-generation business model combining
boutique investment qualities with the benefits of a fully
integrated, centralized operating and distribution platform.
Victory Capital provides specialized investment strategies to
institutions, intermediaries, retirement platforms and individual
investors. With 10 autonomous Investment Franchises and a Solutions
Platform, Victory Capital offers a wide array of investment styles
and investment vehicles including, actively managed mutual funds,
separately managed accounts, active ETFs, multi-asset class
strategies, custom-designed solutions and a 529 College Savings
Plan.
For more information, please visit www.vcm.com or follow us:
Twitter and LinkedIn
About New Energy Capital
New Energy Capital is a leading alternative asset management
firm which invests across the capital structures of small-and
mid-sized clean energy infrastructure projects and companies.
Founded in 2004 and headquartered in Hanover, New Hampshire, NEC
was one of the first investors to focus on clean energy and
infrastructure assets. NEC has delivered a 17-year track record of
strong performance on behalf of investors by focusing on real
assets which generate stable cash flows based on long-term
contracts with utilities and other creditworthy counterparties.
NEC has participated in transactions totaling more than $3
billion in total asset value. The investment team has extensive
experience in all aspects of clean infrastructure investing,
including evaluating energy markets, projects, and technologies;
developing and financing domestic and international power
generation, fuels, wastewater management, and distributed
generation facilities; founding and managing renewable energy
companies; and understanding the public policies that currently
shape the landscape for the energy and related infrastructure
markets.
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version on businesswire.com: https://www.businesswire.com/news/home/20210913005201/en/
Investors: Matthew Dennis, CFA Chief of Staff Director, Investor
Relations 216-898-2412 mdennis@vcm.com
Media: Tricia Ross 310-622-8226 tross@finprofiles.com
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