Vinci Compass Investments (VINP) Investor Update summary

Strategic rationale and combination highlights

• Vinci and Compass have merged to form Vinci Compass, a leading alternative asset manager in Latin America with BRL 296 billion in AUM and a pan-regional presence across eight countries.

• The merger leverages complementary geographic footprints, product offerings, and distribution networks, enabling cross-selling and broader client solutions with minimal overlap.

• The new entity aims to be a one-stop shop for alternative investments, serving local, regional, and global clients while capturing the under-penetrated alternatives market in Latin America.

• A unified leadership team integrates executives from both firms, ensuring seamless governance and operational efficiency.

• The transaction is immediately accretive to fee-related earnings per share, with a 9% increase in 3Q'24.

Financial performance and guidance

• Pro forma AUM increased 20% year-over-year, with Global IP&S and credit segments driving over BRL 11 billion in inflows.

• Fee-related earnings (FRE) for Q3 YTD reached BRL 218 million, up from BRL 169 million for Vinci standalone, with FRE per share up 9%.

• Compass is expected to contribute R$15 million in FRE to 4Q'24 results.

• FRE margins stand at 33% pro forma, with management targeting a return to 40%+ over five years through cost and revenue synergies.

• Short-term blended tax rate for the group is expected between 15%-20%, reflecting increased dollarization and regional diversification.

Growth strategy and market opportunities

• Vinci Compass will focus on expanding alternatives in Latin America, especially as regulatory changes in Mexico double pension fund allocations to alternatives.

• The firm is launching its first pan-regional alternative product (SPS IV) and expects to capture a significant share of the $70 billion regional mandates market.

• Over 30 potential M&A targets have been identified, representing more than $100 billion in AUM, to accelerate growth and enter new markets.

• The combined platform is positioned to benefit from the trend of exporting local capital to global markets, especially from Brazil.

• Management is focused on expanding alternatives across LatAm, enhancing revenue, and accelerating regional growth through M&A.