Richardson GMP Limited to acquire Macquarie Private Wealth Inc.
September 9, 2013 - Press release
Richardson GMP Limited (Richardson GMP) today announced that it has reached an agreement (the Agreement) to acquire Macquarie Group’s Canadian retail business, Macquarie Private Wealth Inc. (MPW Canada). Upon completion of the transaction, Richardson GMP will have $28 billion in assets under administration.
“This transformational transaction for Richardson GMP reinforces our position as the largest independent wealth management firm in Canada,” said Andrew Marsh, President and CEO of Richardson GMP. “It further establishes Richardson GMP as a firm that can compete with larger institutions, while maintaining a boutique culture. This transaction vaults Richardson GMP into a league of our own.”
“As part of Richardson GMP, our advisors can focus on advice and serve the unique needs of their clients, while having the opportunity to be owners in a large, quality, independent firm,” said Earl Evans, Head of Macquarie Private Wealth Canada.
“The wealth management industry in Canada has been dynamic over the last few years,” continued Mr. Marsh. “By combining with the professionals of Macquarie Private Wealth Canada, Richardson GMP firmly enhances its reputation in the Canadian Wealth Management Industry.”
Under the terms of the Agreement, Richardson GMP has agreed to acquire all of the outstanding shares of MPW Canada for a purchase price of approximately $132 million, which will be funded by an equity offering on a private placement basis. Each of Richardson Financial Group (RFG), a subsidiary of James Richardson & Sons, Limited, and GMP Capital Inc. (GMP) will equally subscribe to a preference share offering by Richardson GMP for total proceeds of $60 million. An additional $30 million will be raised by a common share offering to all Richardson GMP shareholders, including GMP and RFG, on a pro rata basis. Upon completion of the offering, GMP and RFG will continue to own equal interests in Richardson GMP, with the balance being held by Richardson GMP’s management and investment advisors.
Completion of the transaction is subject to a number of customary closing conditions, including regulatory approval by the Investment Industry Regulatory Organization of Canada. The transaction is expected to be completed during the fourth quarter of 2013.
GMP Securities L.P. is acting as financial advisor to Richardson GMP. Macquarie Capital is acting as financial advisor to MPW Canada.
About Richardson GMP
As Canada's largest independent wealth management firm with offices across Canada, Richardson GMP provides exclusive and innovative investment solutions to successful families and entrepreneurs. Since 2010, Richardson GMP has earned top ranking in the Investment Executive Brokerage Report Card for products and services dedicated to high net worth investors. Richardson GMP Limited is a member of the Canadian Investor Protection Fund. www.RichardsonGMP.com
About GMP Capital Inc.
GMP is a leading independent diversified financial services firm headquartered in Toronto, Canada, providing a wide range of financial products and services to a global client base that includes corporate clients, institutional investors and high-net-worth individuals in two integrated reporting segments. The Capital Markets segment provides investment banking, including advisory and underwriting services, institutional sales and trading and research through offices located in Toronto, Montreal, Calgary, New York, Miami, Dallas, London, Perth and Sydney. The Capital Markets segment conducts its business through the following operating entities: GMP Securities L.P., GMP Securities, LLC, Griffiths McBurney Corp., GMP Securities Europe LLP and GMP Securities Australia Pty Limited. Wealth Management consists of GMP's non-controlling ownership interest in Richardson GMP Limited and the investment management and alternative investment products provided by CQI Capital Management L.P. Richardson GMP Limited is a full-service independent firm focused on providing exclusive and comprehensive wealth management and investment services delivered by an experienced team of investment professionals. GMP is listed on the Toronto Stock Exchange under the symbol “GMP”. For further information, please visit our corporate website at www.gmpcapital.com.
About Macquarie Group
Macquarie Group (Macquarie) is a global provider of banking, financial, advisory, investment and funds management services. Macquarie's main business focus is making returns by providing a diversified range of services to clients. Founded in 1969, Macquarie operates in more than 70 office locations in 28 countries and employs more than 13,600 people. Assets under management total approximately $362 billion at March 31, 2013. Upon completion of this transaction, Macquarie will continue to operate diverse business in Canada including institutional equities, corporate advisory, funds management, asset finance, and fixed income, currencies and commodities. The sale of Macquarie Private Wealth Canada will have no effect on Macquarie’s other businesses in Canada which continue to operate from Toronto, Calgary, Montreal and Vancouver. For more information, visit www.macquarie.com.
This press release contains “forward-looking information” as defined under applicable Canadian securities laws. This information includes, but is not limited to, statements concerning our 2013 objectives, our strategies to achieve those objectives, as well as statements made with respect to management's beliefs, plans, estimates, projections and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts, as well as statements regarding Richardson GMP’s acquisition of MPW Canada. Forward-looking information generally can be identified by the use of forward-looking terminology such as “outlook”, “objective”, “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “should”, “plans” or “continue”, or similar expressions suggesting future outcomes or events. Such forward-looking information reflects management's current beliefs and is based on information currently available to management.
Forward-looking information is not a guarantee of future performance and is subject to numerous risks and uncertainties, including those described in this press release. Richardson GMP’s acquisition of MPW Canada is subject to various risks and uncertainties, including that the conditions to closing will not be satisfied or waived or that the transactions will otherwise not be consummated. GMP's primary business activities are both competitive and subject to various risks. These risks include market, credit, liquidity, operational and legal and regulatory risks and other risk factors including, without limitation: variation in the market value of securities, volatility and liquidity of equity and fixed income trading markets, volume of new financings and mergers and acquisitions (M&A), dependence on key personnel and sustainability of fees. Other factors, such as general economic conditions, including interest rate and exchange rate fluctuations, may also have an effect on GMP's results of operations. Many of these risks and uncertainties can affect GMP's actual results and could cause its actual results to differ materially from those expressed or implied in any forward-looking information disclosed by management or on its behalf. For a description of additional risks that could cause our actual results to materially differ from our current expectations, see “Risk Management” in the 2012 Annual MD&A and the Second Quarter 2013 MD&A and “Risk Factors” in GMP's 2013 Annual Information Form dated March 13, 2013. These risks and uncertainties are not the only ones facing GMP together with its consolidated operations controlled by it and its predecessors (GMP Group). Additional risks and uncertainties not currently known to us or that we currently consider immaterial may also impair the operations of the GMP Group. Material assumptions or factors underlying the forward-looking information contained in this press release are set out in the “Business Environment and Market Outlook” section of the Second Quarter 2013 MD&A and include, without limitation: continued economic recovery in the U.S., slow growth and weak demand for commodities in emerging markets including China, subdued Canadian capital markets activity. Although forward-looking information contained in this press release is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with this forward-looking information. Certain statements included in this press release may be considered a “financial outlook” for purposes of applicable Canadian securities laws, and as such the financial outlook may not be appropriate for purposes other than this press release. The forward-looking information contained in this press release is made as of the date of this press release, and should not be relied upon as representing GMP's views as of any date subsequent to the date of this press release. Except as required by applicable law, management and GMP's Board of Directors undertake no obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise.
GMP Capital Inc.
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