KeyCorp said Thursday it plans to sell its investment management subsidiary Victory Capital Management Inc. and affiliate brokerage Victory Capital Advisors for $246 million.
The Cleveland-based company will sell to a partnership of Victory’s senior management team and other employees owning significant shares of the business, and New York City private-equity firm Crestview Partners, officials said Thursday.
The sale is expected to close in the third quarter.
“This new ownership structure will preserve our successful multi-boutique operating model and provide an opportunity for real equity ownership to our employees that will align our interests with those of our clients, today and well into the future,” Victory CEO David Brown said in a statement.
KeyCorp is the parent of KeyBank N.A. in the Rochester market. It also oversees investment banking products under the trade name KeyBanc Capital Markets.
“For Key, the divestiture is consistent with our strategic focus on businesses that leverage the competitive advantages of our core relationship banking model,” said KeyCorp chairman and CEO Beth Mooney in a statement.
The sale—to a private-equity fund sponsored by Crestview Partners—consists of $201 million at closing and a seller note with an initial face amount of $45 million, officials said. The final value will be determined at the end of the year.
New York City-based Crestview Partners has assets of $4 billion, officials said.
Victory plans to maintain its Cleveland headquarters, with offices in New York City, Cincinnati, Denver and Tampa. It manages and advises some $22 billion in equity and fixed income assets.
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