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Scotiabank to acquire Jarislowsky Fraser
Posted on Tuesday, 13 February 2018 11:59
Investment firm Jarislowsky Fraser is being picked up by The Bank of Nova Scotia (Scotiabank) in a deal that will create the third-largest active asset manager in Canada.
The buyer will pay CAD 950.00 million (USD 755.07 million) in newly issued shares and could fork out a further earn-out consideration of CAD 56.00 million, dependent on the attainment of certain growth targets.
Scotiabank is planning a share buyback after the acquisition, which it anticipates will increase earnings in the financial year 2020.
Expected to close by 30th June 2018, the purchase is the second-largest deal to target a portfolio manager announced worldwide so far this year, according to Zephyr, the M&A database published by Bureau van Dijk.
At 31st December 2017, the firms had combined assets under management totalling USD 166.00 billion.
Jarislowsky Fraser will retain its Montreal headquarters as well as its current management team following the deal, which has been unanimously approved by its partners.
Listed on both the Toronto and New York stock exchanges, Scotiabank had a market capitalisation of CAD 91.91 billion at 9th February 2018.
It was founded in 1832 and, for the year ending 31st October 2017, reported net income of USD 7.88 billion, up 12.7 per cent from the USD 6.99 billion posted for 2016.
These improved results can be attributed to the growing numbers of loans and deposits.
Chief executive Brian Porter said the transaction will allow the bank 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".
Jarislowsky Fraser describes itself as one of the leading independent Canadian investment firms and manages international portfolios of pension funds, foundations and endowments, corporations, and individuals.
© Zephus Ltd