Globe & Mail 08:02 AM EDT, 06/13/2023 (MT Newswires) -- McDougall Insurance Brokers Ltd., a subsidiary of Definity Financial Corp. (DFY.TO), said Tuesday that it has agreed to buy 100% of Drayden Insurance Ltd. for $208 million.
The transaction will be funded by Definity, through McDougall, using a combination of excess capital and debt. After accounting for all related transactions, Definity's ownership interest in McDougall will increase to roughly 78%.
The company's shares, which slipped 0.6% in Canada yesterday, lost 1.6% in early Frankfurt trading on Tuesday.
Founded in 1965, Drayden is an insurance broker in Alberta.
After the closing of the Drayden transaction, McDougall will have more than $860 million in annual premiums with 860 employees in 65 office locations. The transaction is expected to be immediately accretive to Definity's operating return on equity and operating earnings per share. Definity continues to hold significant financial capacity for future opportunities.
The deal is expected to close in the third quarter.