David Brown and his team are preparing to snap up a 100-percent employee-owned, $435-million-AUM equity asset manager.

Christopher Nicholas Cuesta THB Asset Management CEO, Chief Investment Officer, Principal, PM

Yesterday Brown, chairman and CEO of Victory Capital Holdings [profile], confirmed that they have agreed to acquire some assets from THB Asset Management. The Norwalk, Connecticut-based shop's investment team will move over to San Antonio-based Victory as part of the deal, though they'll remain in Norwalk.

The deal, which is expected to close early in next year, includes "no material consideration" to be paid for THB assets. Yet, like with other Victory boutiques, the THB team will get revenue sharing as part of their compensation agreement, the Victory team confirms.

BofA Securities advised Victory on the deal, while Acclinate served as a consultant to THB. Willkie Farr Gallagher provided legal advice to Victory.

THB (fka Thomson, Hortsmann & Bryant) was founded in 1982 and, as of their most recent form ADV back in July 2020, the firm had a team of 14, not counting clerical staff. Their strategies include U.S., international, and global portfolios, and they include capacity constrained, micro-cap, small-cap, and mid-cap offerings. And they've been running SRI/ESG portfolios for three decades. They have distribution relationships in Australia and Europe, too.

THB also advises a mutual fund, the four-star, $53.6-million-AUM, eight-year-old THB Asset Management MicroCap Fund, which is PMed by THB CEO Christopher Cuesta (also a principal and chief investment officer) and vice president Manish Maheshwari (also a principal).

Other leaders at THB include: James Kennedy, principal, chief operating officer, and chief compliance officer; William Bryan, vice president and PM; Keith Dickinson, vice president; and Victoria Konstantinova, vice president.

Cuesta lauds Victory for "their entrepreneurial culture, strategic vision, and appreciation of capacity constrained strategies."

"This transaction will not affect our investment philosophy or process, and we look forward to devoting all our attention to managing portfolios and serving clients from our current location in Norwalk, CT," Cuesta states. "We have significant capacity to grow assets in our products and believe Victory Capital's broad and deep distribution network — coupled with its ability to develop in-demand products and investment vehicles — will accelerate our growth."

Brown notes that THB offers strategies in areas where the Victory team has "extensive operating and distribution experience" and praises the THB for their "genuine edge" in terms of performance track record. He also leaves the door open to further deals.

"We also continue to evaluate a wide variety of other acquisition prospects," Brown states. 

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