$IVZ · Invesco Ltd.
Invesco Ltd. entered into a $1.5 billion unsecured 5-year term loan with a bank syndicate led by Bank of America to fund the repurchase of $1.5 billion of its 5.9% Fixed Rate Non-Cumulative Perpetual Series A Preference Shares from MassMutual at a 12.5% premium to the $1,000/share liquidation preference. MassMutual, which owns ~18.5% of Invesco common shares, retains $1B in preferred stock. The transaction closed October 26, 2026.
- $1.5B 5-year unsecured term loan borrowed in full on October 26, 2026 to fund the preferred stock repurchase.
- MassMutual received a 12.5% premium on the $1,000/share liquidation preference for the repurchased Series A Preferred Stock.
- MassMutual retains $1B aggregate liquidation preference of Preferred Stock and ~18.5% of Invesco common shares.
- Term loan amortizes at 2.5% per quarter starting year 3, with full maturity on October 26, 2031.
- Financial covenants: Debt/EBITDA ≤ 3.25:1.00 and interest coverage ≥ 4.00:1.00, with up to $600M cash netting.
Markets closed — no regular-session reaction yet; extended-hours move not captured here.
A $1.5B debt-for-preferred swap with a major shareholder reshapes Invesco's capital structure — replacing fixed 5.9% preferred dividends with floating-rate bank debt while keeping MassMutual as both a $1B preferred holder and 18.5% common owner.
Asset managers have been actively restructuring balance sheets and retiring expensive preferred equity. The SOFR+135bps spread on a $1.5B term loan for a $12.6B market-cap manager reflects investment-grade access, though the 12.5% premium on the preferred buyback suggests the legacy MassMutual instrument carried above-market cost.
The term loan's financial covenants (Debt/EBITDA ≤ 3.25x, interest coverage ≥ 4.00x) create ongoing compliance risk; a breach could trigger acceleration. The 12.5% premium paid to a related-party shareholder (~18.5% owner) may draw scrutiny on deal terms.