By Robb M. Stewart
An arm of Abu Dhabi's sovereign wealth fund has agreed to buy CI Financial in a deal valuing the Canadian asset and wealth manager at about 4.7 billion Canadian dollars, the equivalent of $3.4 billion.
Mubadala Capital, the asset-management unit of the sovereign wealth fund, struck a definitive agreement to buy CI's for a cash consideration equal to C$32 a share, which marks a 33% premium to the last closing price. CI said the deal to take it private implies an enterprise value of close to C$12.1 billion.
The takeover provides long-term capital to help fund CI's growth and its expansion in the U.S., where it operates as Corient, the Toronto-based company said. CI said that under the agreement it will retain its existing leadership and its headquarters in Canada and existing operations in the country.
Hani Barhoush, managing director and chief executive of Mubadala Capital, said the firm was fully aligned with the strategy and direction of CI and aimed to support building its business.
The Globe & Mail over the weekend reported that CI was holding talks with private equity firms about a new investment and the potential for a full-blown privatization. CI's shares have risen more than 60% in 2024.
CI, which had total assets of C$518.1 billion as of the end of September, said that following a unanimous recommendation of a special committee of independent directors its board recommends shareholders vote in favor of the takeover.
The deal remains subject to court approval and regulatory clearances but isn't subject to any financing conditions. The companies expect the transaction to close in the second quarter of 2025.
CI said Chief Executive Kurt MacAlpine plans to roll his stake in the company in the transaction. Other members of CI's senior management holding an aggregate of up to 1.5% of the company's shares are also expected to have the opportunity to enter into equity rollover agreements to exchange their CI shares into a new holding vehicle. Chairman William Holland may roll 25% of his total CI holdings in the deal.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
November 25, 2024 08:07 ET (13:07 GMT)
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