Provides immediate scale to serve fast-growing private client segment along with significant incremental IIROC distribution across Canada
QUEBEC CITY, July 16, 2013 /CNW Telbec/ - Industrial Alliance Insurance and Financial Services Inc. ("Industrial Alliance") today announced an agreement to acquire through a plan of arrangement all of the outstanding common shares of Jovian Capital Corporation ("Jovian") at $10.23 per share for an aggregate consideration of $94 million. Jovian shareholders may elect to receive proceeds either all in cash or 0.2386 of a common share of Industrial Alliance for each common share of Jovian, or a combination thereof, subject to an overall cap of 35% of the aggregate consideration payable in Industrial Alliance common shares.
Jovian (TSX:JOV) holds interests in a portfolio of financial services companies, including Leon Frazer & Associates Inc., T.E. Investment Counsel Inc., Hahn Investment Stewards & Company Inc., JovFinancial Solutions Inc. and IIROC dealer MGI Securities Inc. Jovian has combined assets under management and administration of almost $7 billion.
"This is a strategic and additive acquisition that complements our well-established wealth management platform," commented Yvon Charest, President and Chief Executive Officer of Industrial Alliance. "It provides us with immediate scale in the fast-growing private client management segment, as well as significant incremental IIROC distribution across Canada. We extend a warm welcome to all members of the Jovian group and view their addition to the Industrial Alliance family as important to the continued expansion and success of our wealth management business.""Over the last 10 years, Industrial Alliance has grown organically and through acquisitions to become a leading manufacturer and distributor of wealth management solutions in Canada with assets under management and administration of more than $45 billion," added David Scandiffio, Senior Vice President of Industrial Alliance and head of the Company's wealth management division. "With the addition of the Jovian group of companies ― each of which brings unique expertise in different facets of private client management ― we look forward to expanding our products and services to current distribution partners as well as extending that offering to broader distribution channels." The acquisition of Jovian will result in one-time restructuring and transaction costs of approximately $0.09 per share. Excluding these costs, the acquisition is expected to be neutral to earnings per share in 2013. The transaction will have an impact of approximately 5 percentage points on the solvency ratio. The board of directors of Jovian has unanimously approved the transaction and has agreed to recommend that shareholders vote in favour of the transaction. Shareholders owning or controlling approximately 38% of Jovian's outstanding shares have agreed to vote in favour of the transaction. An information circular with further details on the plan of arrangement is expected to be mailed by Jovian to its shareholders in August 2013. The transaction, which is subject to customary closing conditions, including receipt of court, shareholder and regulatory approvals, is expected to be completed in early October 2013. Forward-looking Statements This press release may contain statements relating to strategies used by Industrial Alliance or statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as "may", "will", "could", "should", "would", "suspect", "expect", "anticipate", "intend", "plan", "believe", "estimate", and "continue" (or the negative thereof), as well as words such as "objective" or "goal" or other similar words or expressions. Such statements constitute forward-looking statements within the meaning of securities laws. Forward-looking statements include, but are not limited to, information concerning the Company's possible or assumed future operating results. These statements are not historical facts; they represent only the Company's expectations, estimates and projections regarding future events. Although Industrial Alliance believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. Factors that could cause actual results to differ materially from expectations include, but are not limited to: general business and economic conditions; level of competition and consolidation; changes in laws and regulations including tax laws; liquidity of Industrial Alliance including the availability of financing to meet existing financial commitments on their expected maturity dates when required; accuracy of information received from counterparties and the ability of counterparties to meet their obligations; accuracy of accounting policies and actuarial methods used by Industrial Alliance; insurance risks including mortality, morbidity, longevity and policyholder behaviour including the occurrence of natural or man-made disasters, pandemic diseases and acts of terrorism.