UAE-based Mubadala Capital has agreed to acquire Canadian asset and wealth management company CI Financial in a deal that represents an enterprise value of about C$12.1bn ($8.58bn).
The all-cash transaction values CI Financial’s equity at approximately C$4.7bn ($3.33bn).
According to the terms of the definitive agreement, the alternative asset management arm of Mubadala Investment will pay C$32 ($22.69) per share for all outstanding CI Financial shares.
These shares exclude those held by members of CI Financial’s senior management, who will enter into equity rollover agreements.
Mubadala Capital’s consideration marks a 33% premium to the Canadian company’s last closing price and a 58% premium to its 60-day volume-weighted average price on the Toronto Stock Exchange (TSX).
CI Financial CEO Kurt MacAlpine intends to roll all his equity into the transaction. Other senior management members, collectively holding up to 1.5% of the company’s shares, are expected to participate in equity rollover agreements.
Additionally, CI Financial chairman William Holland may roll over 25% of his total holdings as part of the transaction. All equity rollovers will be executed at the cash purchase price.
Following the closing of the deal, CI Financial’s shares will be delisted from the TSX and will become a private asset and wealth management company.
However, the company will remain a reporting issuer under Canadian securities laws due to its outstanding debentures and notes. Mubadala Capital has committed up to C$750m ($532m) in additional cash at closing to reduce preferred equity outstanding.
Upon the closing of the transaction, CI Financial will continue to operate under its existing structure and management team. It will maintain its headquarters in Canada.
CI Financial manages, advises on, and administers about C$518.1bn ($367.4bn) in client assets as of 30 September 2024. It operates in three segments, namely asset management, Canadian wealth management, and US wealth management.
MacAlpine said: “Mubadala Capital invests with a long-term outlook and represents long-term capital – providing stability and certainty for CIʼs clients and employees.
“With this transaction, CI has never been better positioned to fulfil our mission of delivering outstanding services and solutions to our clients.”
The proposed deal is anticipated to bolster CI Financial’s expansion in the US, where it operates as Corient.
Besides, the transaction with Mubadala Capital is said to provide the Canadian company with a stable and well-funded platform, enabling reinvestment into its business and strategy.
Mubadala Capital managing director and CEO Hani Barhoush said: “We are fully aligned with the strategy and direction of the firm and look forward to working with the CI management team to continue to build this outstanding business and ensure that CI continues to deliver superior services to its clients.”
The transaction has been unanimously recommended by CI Financial’s board of directors, excluding interested directors.
Subject to court approval, regulatory clearances and other customary conditions, the transaction is anticipated to be completed in Q2 2025.
