Natixis Global Asset Management (Natixis) and NexGen Financial
Corporation (NexGen) (NFX:TSX.V) announced today that NexGen and a
wholly-owned subsidiary of Natixis have entered into an agreement in
which Natixis will acquire all of the outstanding common shares of
NexGen for consideration consisting of CA$7.25 cash per common share,
for an enterprise value of approximately CA$35 million.
The CA$7.25 price per share represents a 107% premium to NexGen's
closing share price of CA$3.50 on October 23, 2014, the last trading day
before announcement of the transaction.
NexGen is a Toronto-based asset manager with more than CA$919 million
(as of Sept. 30, 2014) in assets under management and a broad
distribution platform.
Rationale for the Transaction
“NexGen is an innovative firm with a strong management team and a solid
lineup of retail mutual funds offered through an expansive distribution
platform,” said John Hailer, chief executive officer of Natixis in the
Americas and Asia. “We are honored to build on the legacy James Hunter
established in one of the largest retail markets in the world. Together
with NexGen, we will be better positioned to serve the market with our
worldwide network of affiliated investment managers.”
Natixis manages more than $930 billion (as of June 30, 2014) in assets
through its global affiliates and was selected as the top U.S. mutual
fund family based on an evaluation of 2013 performance, according to the
annual Barron’s/Lipper ranking of U.S. mutual fund families. The
firm is headquartered in Paris and Boston with offices around the world.
Natixis plans to build upon NexGen’s existing mutual fund platform by
selectively offering its broad range of asset management strategies into
the Canadian retail market.
"We are very pleased to join one of the world’s leading asset managers,"
said Abe Goenka, NexGen co-CEO. "It’s exciting to become part of an
organization with significant resources and an outstanding group of
affiliated asset managers. This gives us greater access to a broad set
of investment strategies that will allow us to create new products
adding to our already diverse fund offerings, allowing us to better
serve current clients and pursue new opportunities."
Expanding into Canada is part of Natixis’ strategic plan to actively
pursue international growth. In June, the firm announced plans to launch
a new business development initiative in Canada focused on tapping into
the steadily growing Canadian institutional market. In 2013, the firm
established its retail platform in the UK, adding personnel and
launching several mutual funds registered for the UK.
NexGen is recognized for offering tax-efficient wealth management
strategies. Their patent pending proprietary mutual fund structure is
designed to achieve a number of tax planning objectives that are not
publicly offered by any other Canadian mutual fund company. The firm
distributes through more than 1,600 financial advisors and more than 100
dealers throughout Canada.
Transaction Details
The transaction will be completed by way of a statutory plan of
arrangement pursuant to the Business Corporations Act (Ontario). Upon
receipt of the unanimous recommendation of the special committee of
independent directors, the NexGen board approved the transaction and has
resolved to recommend that NexGen shareholders vote in favor of the
transaction at a special meeting of the shareholders to approve the
transaction. Blair Franklin Capital Partners Inc. has provided an
opinion to the NexGen board of directors and special committee that, as
of October 24, 2014, the consideration under the proposed transaction is
fair, from a financial point of view, to NexGen's shareholders.
Completion of the transaction is subject to customary closing
conditions, including Ontario court approvals, a favorable vote of at
least two-thirds of the votes cast by NexGen shareholders and applicable
regulatory approvals.
In connection with the execution of the arrangement agreement,
shareholders who collectively own over 50% of NexGen's issued and
outstanding common shares have entered into agreements with Natixis
pursuant to which they have agreed, among other things, that they will
vote all of their NexGen common shares in favour of the transaction,
unless the arrangement agreement is terminated in certain circumstances.
The arrangement agreement includes customary non-solicitation provisions
applicable to NexGen and provides for the payment of a CA$1.75 million
break-up fee to Natixis if the transaction is terminated in certain
circumstances.
NexGen will seek approval for the transaction from its shareholders at a
special meeting, which it expects will be held close to yearend. In
connection with the meeting, NexGen will mail an information circular to
its shareholders providing further details of the transaction.
The proposed transaction will constitute a change of control of NexGen
Financial Limited Partnership, the manager of the NexGen mutual funds,
and investors in the NexGen funds will be sent notice of the change of
control.
In keeping with the Natixis multi-affiliate business model, NexGen will
operate autonomously with the existing senior management team. There are
no immediate plans to make staffing changes or changes to the NexGen
business model.
Assuming timely receipt of all necessary court, shareholder and
regulatory approvals and the satisfaction of all other conditions,
closing is expected to occur in January 2015.
Advisors
Blair Franklin Capital Partners Inc. is acting as financial advisor to
NexGen and Goodmans LLP is acting as legal counsel to NexGen.
Borden Ladner Gervais LLP is acting as legal counsel to Natixis.
About Natixis Global Asset Management, S.A.
Natixis Global Asset Management, S.A. is a multi-affiliate organization
that offers a single point of access to more than 20 specialized
investment firms in the U.S., Europe and Asia. The firm ranks among the
world’s largest asset managers.1 Through its Durable
Portfolio Construction® philosophy, the company is
dedicated to providing innovative ideas on asset allocation and risk
management that can help institutions, advisors and individuals address
a range of modern market challenges. Recognized as the #1 U.S. mutual
fund family for 2013 performance in the annual Barron’s/Lipper
Fund Family Ranking,2 Natixis Global Asset Management, S.A.
brings together the expertise of multiple specialized investment
managers based in Europe, the United States and Asia to offer a wide
spectrum of equity, fixed-income and alternative investment strategies.
Headquartered in Paris and Boston, Natixis Global Asset Management,
S.A.’s assets under management totaled $930.5 billion (€679.5 billion)
as of June 30, 2014.3 Natixis Global Asset Management, S.A.
is part of Natixis. Listed on the Paris Stock Exchange, Natixis is a
subsidiary of BPCE, the second-largest banking group in France. Natixis
Global Asset Management, S.A.’s affiliated investment management firms
and distribution and service groups include Absolute Asia Asset
Management; AEW Capital Management; AEW Europe; AlphaSimplex Group;
Aurora Investment Management; Capital Growth Management; Darius Capital
Partners; Gateway Investment Advisers; H2O Asset Management; Harris
Associates; IDFC Asset Management Company; Loomis, Sayles & Company;
McDonnell Investment Management; Mirova Asset Management; Natixis Asset
Management; Ossiam; Natixis Environnement & Infrastructure Luxembourg;
Reich & Tang Asset Management; Snyder Capital Management; Vaughan Nelson
Investment Management; Vega Investment Managers; and Natixis Global
Asset Management Private Equity, which includes Seventure Partners,
Naxicap Partners, Alliance Entreprendre, Euro Private Equity, Caspian
Private Equity and Eagle Asia Partners.
About NexGen Financial
NexGen Financial Corporation was founded to develop value-added
investment solutions for financial advisors and their clients. The firm
is focused on the creation of innovative investment products and
services that meet the needs of Canadians seeking more tax-efficient
investment opportunities and greater control over the tax treatment of
their investments. Managed by strong investment professionals, NexGen’s
unique Registered and Tax-Managed Fund offerings are well positioned as
attractive investment opportunities for Canadians looking to manage the
tax costs associated with traditional investment solutions.
Forward-Looking Statements
This news release contains forward-looking statements within the meaning
of securities legislation and that are based on the expectations,
estimates and projections of management of the parties as of the date of
this news release unless otherwise stated. Forward-looking statements
are generally identifiable by use of the words "expect", "anticipate",
"continue", "estimate", "objective", "ongoing", "may", "will",
"project", "should", "believe", "plans", "intends" or the negative of
these words or other variations on these words or comparable
terminology. More particularly, and without limitation, this news
release contains forward-looking statements and information concerning
expectations regarding the consideration to be issued pursuant to the
transaction, the ability of NexGen and Natixis to consummate the
transaction on the terms and in the manner contemplated thereby, the
anticipated benefits of the transaction, and the anticipated timing of
the transaction. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause actual
results, performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by the
forward-looking statements. Such factors include, among others, the time
required to prepare and mail meeting materials to NexGen shareholders,
the ability of the parties to receive, in a timely manner and on
satisfactory terms, the necessary court, shareholder, stock exchange and
regulatory approvals and the ability of the parties to satisfy, in a
timely manner, the conditions to the closing of the transaction, as well
as other uncertainties and risk factors set out in filings made from
time to time by NexGen with the Canadian securities regulators, which
are available on SEDAR at www.sedar.com.
Actual results, developments and timetables could vary significantly
from the estimates presented. Readers are cautioned not to put undue
reliance on forward-looking statements.
1 Cerulli Quantitative Update: Global Markets 2014,
ranked Natixis Global Asset Management, S.A. as the 16th largest asset
manager in the world based on assets under management as of December 31,
2013.
2 Barron's/Lipper 2013 one-year fund family ranking
based on 64 qualifying U.S. fund companies. Each fund family must have
at least three funds in Lipper's general U.S.-stock category, one world
(global and international), one mixed-asset/balanced (stocks and bonds),
two taxable bond and one tax-exempt bond fund. Natixis was not ranked
for the 5- and 10- year periods. Past performance is no guarantee of
future results.
3 Assets under management (AUM) may include assets
for which non-regulatory AUM services are provided. Non-regulatory AUM
includes assets which do not fall within the SEC’s definition of
‘regulatory AUM’ in Form ADV, Part 1.
Regulatory Disclaimer
Neither the TSX Venture Exchange nor its Regulation Services Provider
(as that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
Copyright Business Wire 2014