S&P Affirms Victory Capital's 'BB' Rating, Revises Outlook to Stable on First Eagle Deal

S&P Global Ratings affirmed Victory Capital Holdings Inc.'s (NYSE:VCTR) 'BB' issuer credit rating following the asset manager's plan to acquire First Eagle Investments. However, the rating agency revised its outlook on Victory Capital to stable from positive, reflecting the substantial increase in debt the company will take on to fund the transaction.

The Rating Action Explained

The stable outlook is based on S&P's expectation that Victory Capital's leverage will operate in a range of 3.0x to 4.0x in the 12 months after the acquisition closes. While the deal significantly enhances Victory's scale and diversification, the debt-heavy financing structure tempers the near-term credit profile, prompting the removal of the positive outlook.

S&P stated it could lower the rating if leverage rises above 4.0x or if the combined business experiences a deterioration in operating or investment performance. Conversely, a future upgrade could be considered if Victory Capital sustains leverage below 3.0x or demonstrates a strong record of organic growth and successful integration.

Acquisition Details

Victory Capital announced on Aug. 26, 2026, that it would acquire 100% of First Eagle Investments, a private global asset manager with approximately $222 billion in assets under management (AUM). The transaction will be largely financed through:

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• A $3.5 billion term loan B
• $950 million in senior secured notes
• $2.0 billion in new equity

Victory also plans to assume First Eagle’s existing $575 million in senior secured notes as part of the deal.

Strategic Rationale and Market Impact

The acquisition is viewed by S&P as strategically complementary, creating a firm with pro forma AUM of approximately $571 billion and projected combined revenue of over $3 billion in 2027. The deal expands Victory's global operations and distribution channels while adding significant capabilities in new asset classes.

Notably, the integration of First Eagle's $40 billion alternative credit and collateralized loan obligation (CLO) platform provides Victory with valuable exposure to growing and diversified investment areas. For investors, the transaction represents a major strategic expansion, though the resulting increase in corporate debt will be a key metric to monitor going forward.