KeyCorp (KEY: Quote) Thursday announced agreeement to sell its investment management subsidiary Victory Capital Management and its broker dealer affiliate Victory Capital Advisers to a private equity fund, sponsored by Crestview Partners, for $246 million in cash and debt.
The divestiture allows the company to focus on businesses that leverage the competitive advantages of our core relationship banking model, and thereby operate as a pure play investment management business, with management owning an equity position.
The sale price consists of $201 million of cash at closing and a seller note. The initial face amount of the note will be $45 million, with its final value determined at the end of 2013.
The transaction was approved by the Victory Mutual Fund Board of Directors, and is subject to customary closing conditions and consents of the Victory Mutual Fund shareholders and certain investment advisory clients.
The sale is expected to close during the third quarter of 2013. Key intends to seek regulatory approval to use the gain from the sale to repurchase shares of its common stock.
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by RTT Staff Writer
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