Montreal-based asset management company Fiera Capital has entered into an agreement to acquire CGOV Asset Management, an Ontario-based investment management firm focused on high-net-worth and institutional investors with around C$5.3bn (€3.3bn) in assets under management as of 31 December 2017.
As termed in the agreement, the acquisition of CGOV by Fiera Capital will amount to $114.2m (€91.8m), of which 42% is payable in cash on closing and 58% in class A shares of Fiera Capital at a price equal to $11.91 (€9.57).
It is understood the Fiera Capital Class A Shares shall be placed in escrow and released over a five year period following transaction closing subject to certain terms and conditions.
Around 16.7% of the Fiera Capital Class A Shares placed in escrow will be released after a five year period only if Fiera Capital retains at least 80% of institutional assets under management of CGOV after a four year period following closing.
The transaction is expected to close in Q2 2018, and is subject to customary regulatory approvals, including that of the Toronto Stock Exchange. Following completion of the transaction, CGOV partners and key employees will be joining Fiera Capital including Ted Ecclestone, who will lead Fiera Capital’s Canadian private wealth team.
“With a solid base in Ontario and Western Canada, the critical mass gained as a result of the transaction allows Fiera Capital to be a competitive force in the highly attractive high-net-worth segment across Canada. The transaction is Fiera Capital’s strongest commitment yet to developing leading solutions for both existing and new high-net-worth clients,” commented Jean-Phillipe Lemay, president and chief operating officer of Fiera Capital’s Canadian Division.
“Together, we will clearly be stronger, and are excited about the prospect of also growing our institutional offering through the addition of CGOV’s investment expertise within Fiera Capital’s already strong investment platform,” he added.
“The combination of the CGOV team with Fiera Capital is an exciting opportunity for CGOV and its clients. The transaction will provide a stable, long-term platform for our investment team to continue delivering value. It will also bring robust investment solutions to CGOV clients, including access to enhanced fixed income and private alternative strategies,” said Don Cranston, founding partner and chairman of CGOV Asset Management.
Fiera Capital had C$128.9bn (€80.4bn) in assets under management as at end of 2017.