Third largest Canadian AM to emerge through M&A
Toronto-headquartered financial group Scotiabank is set to purchase independent asset manager Jarislowsky Fraser for around $950m. The transaction, subject to regulatory approval, is expected to close during Q3 2018.
Scotiabank’s asset management business and Jarislowsky Fraser, which has over $40bn in assets under management, will together become the third largest Canadian asset manager with AUM totalling $166bn, as of 31 December 2017.
The acquisition will be paid mainly through the issuance of Scotiabank common shares. It is understood an earn-out of up to $56m in additional Scotiabank common shares may be paid based on achieving growth targets.
Jarislowski Fraser’s founder Stephen Jarislowsky will pursue with the business which will retain its name and investment autonomy. Jarislowsky’s partners have agreed to invest half of their proceeds from the closing of the transaction into Jarislowsky Fraser’s investment strategies.
The Jarislowsky Fraser management team will continue to lead its existing business and its head office will remain in Montreal, Quebec.
“Jarislowsky Fraser is an iconic Canadian brand with a disciplined investment process, a team‐oriented approach with a proven high‐calibre investment team, and a long history of delivering outstanding investment capabilities to institutional investors and high net worth families,” said Brian Porter, president and CEO at Scotiabank.
“This transaction aligns with our strategic commitment to diversify our global wealth management business by building out a platform of rigorous, process‐driven investment capabilities for institutional investors across our footprint in Canada and the Pacific Alliance. The acquisition also enhances Scotiabank’s ability to serve the banking, estate, and trust needs of high net worth families who are the clients of Jarislowsky Fraser,” Porter added.
“Over the course of our 62 year history, Jarislowsky Fraser has built a reputation for delivering excellent investment results for our clients,” said Jarislowsky. “With its existing distribution footprint, Scotiabank is uniquely positioned to preserve the legacy of our firm and enable the next generation of growth. We look forward to continuing to serve our clients and to enhancing our investment capabilities to meet their needs today and in the future.”