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Virtus Investment Closes USD 513m Acquisition of Multi-Boutique Asset Manager RidgeWorth
Friday 02 June 2017

2 June 2017 - US-based investment partnership boutique Virtus Investment Partners, Inc. (NASDAQ: VRTS) has closed the acquisition of US-based multi-boutique asset management firm RidgeWorth Investments, the company said.

This deal was announced last December.

The transaction values RidgeWorth at USD 472m and Virtus will also acquire certain investments at their fair value as of closing, for total consideration of approximately USD 513m.

RidgeWorth has USD 40.2bn in assets managed by affiliated investment managers and unaffiliated subadvisers.

Virtus said the transaction will provide strategic and financial benefits and increase the firm's assets under management to USD 86.8bn on a pro forma basis.

The acquisition will add complementary institutional-quality equity and fixed income strategies from RidgeWorth's boutique managers, who will continue to operate independently, maintaining their teams, culture and distinctive investment processes.

It will also diversify and expand Virtus' client base, particularly among institutional investors, and enhance distribution resources in the institutional, retirement plan, private bank and registered investment adviser channels.

The transaction is expected to be accretive to earnings per share, as adjusted, based on the combined profitability of the companies and anticipated synergies from the consolidation of duplicative corporate and business support functions.

RidgeWorth, headquartered in Atlanta, provides a range of fixed income and equity strategies to institutional and individual clients through separate accounts, retirement plan investment options, and mutual funds. RidgeWorth is owned by its employees and investment funds affiliated with Lightyear Capital.

The acquisition is expected to be financed using existing balance sheet resources and a combination of debt, equity and/or equity-linked securities.

Morgan Stanley Senior Funding, Inc. and Barclays Capital have provided committed debt financing for up to USD 475m.

Virtus Investment is a partnership of boutique investment managers. The company provides investment management products and services through its affiliated managers and select subadvisers, each with a distinct investment style, autonomous investment process, and individual brand.

Its affiliated managers include Duff and Phelps Investment Management, Kayne Anderson Rudnick Investment Management, Newfleet Asset Management, Rampart Investment Management, and Virtus ETF Solutions.

All assets as of September 30, 2016. RidgeWorth AUM figures have not been adjusted to eliminate double-counted assets.

Barclays Capital and Morgan Stanley and Co. LLC acted as financial advisors to Virtus and Willkie Farr and Gallagher LLP was the legal advisor on this transaction. RBC Capital Markets LLC acted as financial advisor and Davis Polk and Wardwell LLP was the legal advisor to RidgeWorth on this transaction.
Date Published: 02/06/2017
Target: RidgeWorth Investments
Country: USA
Deal Size: 513m (USD)
Sector: Banking/Financial Services
Type: Corporate acquisition
Financing: Cash
Status: Closed
Buyer: Virtus Investment Partners
Buyer Advisor: Barclays Capital , Morgan Stanley and Co , Willkie Farr,  and Gallagher