$7 Billion First Eagle Deal Forces Advisory Agreement Reset at Private Credit Fund

Victory Capital Holdings Inc. (Nasdaq: VCTR) has agreed to acquire First Eagle Investments in a deal worth approximately $7 billion, the companies said, creating a combined asset manager with roughly $571 billion in total client assets.

The transaction will also automatically terminate the investment advisory and subadvisory agreements of First Eagle Private Credit Fund, requiring the fund’s board and then its shareholders to approve new agreements before the change takes effect.

Under the agreement, the San Antonio, Texas-based Victory Capital will acquire 100% of First Eagle from private equity firm Genstar Capital and First Eagle employees. First Eagle managed approximately $222 billion as of July 31, 2026, across global value multi-asset, equity, fixed income, and alternative credit strategies, including a $41 billion collateralized loan obligation and alternative credit platform.

Consideration for the deal comprises about $4.4 billion in cash and $2 billion in newly issued Victory Capital equity, the companies said. Victory Capital will also assume $575 million of First Eagle’s existing 7.25% senior secured notes due 2032.

Following the close, Genstar is expected to hold approximately 14.6% of Victory Capital on a fully diluted, as-converted basis, though its voting interest will be capped at 4.9%, with the remainder held as non-voting convertible preferred stock subject to a three-year lock-up. Genstar will also gain the right to designate two directors to Victory Capital’s board, which will expand to 11 members at closing. David Brown will remain chairman and chief executive officer of the combined company.

“This is a transformational transaction that represents the next chapter in the evolution of our business,” Brown said, calling First Eagle “a premier global asset manager” whose product lineup is “highly complementary” to Victory Capital’s own.

First Eagle Investments’ Mehdi Mahmud, president and chief executive officer, said the firm’s investment teams will continue operating independently under the new ownership. “First Eagle’s distinctive investment teams will continue to operate autonomously, with no change to the investment philosophies and processes that have earned our clients’ confidence over time,” Mahmud said.

Victory Capital said the transaction is expected to be approximately 35% accretive to 2027 estimated adjusted earnings per share, inclusive of roughly $280 million in anticipated net expense synergies, and would create a combined company with about $3.2 billion in annual revenue. First Eagle has posted positive net flows in each of the past three years and is net-flow positive year to date through July, the companies said.

The deal is expected to close by the end of the first quarter of 2027, subject to regulatory approvals, client consents, and Victory Capital shareholder approval of the equity issuance. Financing is fully committed from BofA Securities and RBC Capital Markets, structured as a new $3.5 billion term loan B, approximately $950 million in new secured notes, and an upsized $200 million revolving credit facility, the companies said.

Effect on First Eagle Private Credit Fund

First Eagle Holdings Inc. said the deal will make First Eagle Investment Management LLC and First Eagle Alternative Credit LLC – the adviser and subadviser, respectively, to First Eagle Private Credit Fund (FEPCF) – indirect wholly owned subsidiaries of Victory Capital.

Because the closing constitutes an “assignment” of FEPCF’s current investment advisory and subadvisory agreements under the Investment Company Act of 1940, those agreements will automatically terminate at closing. The fund’s board of trustees is expected to consider new agreements – an advisory agreement between the fund and Victory Capital Management Inc., and a subadvisory agreement adding First Eagle Alternative Credit LLC – and, if approved by the board, put them to a shareholder vote. The fund said there is “no assurance” the board or shareholders will approve the new agreements.

Post-closing, First Eagle Alternative Credit will remain part of the alternative credit platform led by Napier Park Global Capital LLC, which Victory Capital has designated as its alternatives platform, the fund said. First Eagle’s alternative credit business will continue to operate autonomously.

PJT Partners is lead financial adviser to Victory Capital, with RBC Capital Markets serving as an additional adviser and Willkie Farr & Gallagher LLP as legal counsel. UBS Investment Bank is lead financial adviser to First Eagle, with BofA Securities as an additional adviser; Ropes & Gray LLP is legal counsel to First Eagle, and Davis Polk & Wardwell LLP represents First Eagle’s management.

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