Virtus Investment Partners, Inc. (NASDAQ: VRTS) today announced it has entered into an agreement to acquire RidgeWorth Investments, a multi-boutique asset management firm with $40.2 billion in assets1 managed by affiliated investment managers and unaffiliated subadvisers. The transaction will provide strategic and financial benefits and increase Virtus' assets under management to $86.8 billion1 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. The transaction 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.

"The acquisition of RidgeWorth will give us increased scale, a wider range of strategies for institutional and individual investors, and broader distribution and client service resources, particularly for institutional clients," said George R. Aylward, president and chief executive officer of Virtus. "The combined company will have a stronger and more diversified business with the scale to better serve clients in a highly competitive industry."

The two companies have comparable business models, both offering clients an array of distinctive investment strategies from boutique affiliates with shared distribution and business support functions that offer meaningful operational efficiencies. "This transaction will provide continuity for RidgeWorth's clients, who will continue to partner with the same investment teams they respect and appreciate while benefiting from the enhanced support of a larger, better resourced organization," Aylward said.

"We are very excited to join Virtus, a firm that shares our vision, culture and approach to offering investment solutions from boutique affiliates," said Ashi Parikh, CEO and chief investment officer of RidgeWorth. "This partnership marks an important milestone in RidgeWorth's journey as it facilitates the transition of RidgeWorth and its clients from a private equity-owned firm to an independent, publicly traded investment management company."

RidgeWorth, headquartered in Atlanta, provides a wide variety 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 LLC. RidgeWorth's wholly owned affiliates are:

• Seix Investment Advisors, which manages $28 billion1 in fixed income through an investment grade team focused on high-quality securities and a leveraged finance team focused on leveraged loans and high-yield credit strategies.
• Ceredex Value Advisors, which manages $10.2 billion1 for institutions, endowments, foundations and high-net worth investors using a traditional value style across all market cap ranges.
• Silvant Capital Management, which manages $1.4 billion1, primarily in the large-cap growth style for institutions.

RidgeWorth also has a minority ownership interest in Zevenbergen Capital Investments, a growth equity boutique.

Key investment professionals of RidgeWorth's wholly owned affiliates have employment agreements and, in conjunction with the transaction, will roll a meaningful portion of their transaction consideration into Virtus stock, creating a strong alignment of interests.

The transaction values RidgeWorth at $472 million and Virtus will also acquire certain investments at their fair value as of closing, for total consideration of approximately $513 million. 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 $475 million.

The transaction, which has been approved by the boards of directors of both companies, is expected to close in mid-2017, subject to customary closing conditions and regulatory, fund shareholder, and other client approvals. The Board of Trustees of the RidgeWorth mutual funds has approved the reorganization of the RidgeWorth mutual funds into the Virtus Mutual Funds and will submit the reorganization proposal to fund shareholders for their approval.

Barclays Capital and Morgan Stanley & Co. LLC acted as financial advisors to Virtus and Willkie Farr & Gallagher LLP was the legal advisor on this transaction. RBC Capital Markets LLC acted as financial advisor and Davis Polk & Wardwell LLP was the legal advisor to RidgeWorth on this transaction.

About Virtus Investment Partners, Inc.

Virtus Investment Partners (NASDAQ: VRTS) is a distinctive partnership of boutique investment managers singularly committed to the long-term success of individual and institutional investors. 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. Virtus Investment Partners offers access to a variety of investment styles across multiple disciplines to meet a wide array of investor needs. Its affiliated managers include Duff & Phelps Investment Management, Kayne Anderson Rudnick Investment Management, Newfleet Asset Management, Rampart Investment Management, and Virtus ETF Solutions. Additional information can be found at virtus.com