Canaccord Genuity Group Inc. has agreed to buy Mercer Global Investments Canada Ltd.’s private wealth business, in a deal expected to add $1.5 billion to Canaccord Genuity Wealth Management’s total client assets.
Canaccord Genuity announced the deal, the terms of which were not disclosed, as a management-led group makes a takeover bid for the company.
“We look forward to making a positive impact for our new clients, partners and employees in the coming months and years,” said Stuart Raftus, Canaccord Genuity’s president of wealth management, Canada, of the Mercer acquisition.
The deal is expected to close within the next three months, subject to regulatory approval.
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The management-led group offering $11.25 per share for Canaccord Genuity includes chief executive Daniel Daviau and chairman David Kassie, as well as all the members of the company’s global operating committee and additional senior and tenured employees from across its business.
Daviau said the company’s shares, which reflect the inherent volatility of the global capital markets in which it operates, have proven to be not well-suited for trading in a public marketplace. The group’s bid values the company at $1.3 billion.
A special committee of independent directors set up to evaluate the offer indicated it was not prepared to support an offer of $11.25 per common share.
Canaccord reported assets under administration in Canada totalling $33.7 billion as of Sept. 30. The firm will report its third-quarter results next week.