American independent investment management firm Invesco has signed an agreement to acquire OppenheimerFunds from Massachusetts Mutual Life Insurance in an all-stock deal worth $5.7bn.
Under the terms of the agreement, Invesco will pay $4bn in preferred shares and 81.9 million of common stock, valued at about $1.7bn. There was no debt associated with the deal.
As a result, MassMutual will become Invesco’s largest shareholder, with an approximate 15.5% stake.
The acquisition of OppenheimerFunds, which specialises in picking stocks and bonds especially in the international market, will lift Invesco’s assets under management to $1.2 trillion.
Commenting on the deal, Invesco president and CEO Martin Flanagan said: “The combination with OppenheimerFunds and the strategic partnership with MassMutual will meaningfully enhance our ability to meet client needs, accelerate growth and strengthen our business over the long term.
“This is a compelling, highly strategic and accretive transaction for Invesco that will help us achieve a number of objectives: enhance our leadership in the US and global markets, deliver the outcomes clients seek, broaden our relevance among top clients, deliver strong financial results and continue attracting the best talent in the industry.”
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
The transaction, which is subject to regulatory and other approvals, is scheduled to be completed during the second quarter of 2019.
Additionally, Invesco and MassMutual have agreed to enter into a shareholder agreement, pursuant to which MassMutual will have customary minority shareholder rights, including representation on Invesco’s board of directors.
MassMutual will nominate William Glavin, Jr., current independent board member of OppenheimerFunds and its retired CEO.