Consolidation continues in the investment fund industry.
Sceptre Investment Counsel Ltd. and Fiera Capital Inc. announced Wednesday that they are tying the knot mainly through a share-swap to create a new firm with $30-billion in assets.
The merger of Sceptre comes amid speculation in recent years that the firm was a takeover candidate. Former CEO Glenn Inamoto died suddenly nearly a year ago only eight months after becoming the firm's top executive when his predecessor Richard Knowles left abruptly. The firm lost 15 per cent of its market value after former star manager Alan Jacobs left in 2008 to join Sprott Asset Management Inc.
More details about the creation of the newly merged firm, which will be called Fiera Sceptre, will be come in a conference call at 11 a.m. eastern time. (Call 416-695-7806 or 1-888-789-9572, pass code 8630843).
Under the agreement, shareholders of Toronto-based Sceptre will exchange 14-million common shares for 14-million new Class A subordinate voting shares of Fiera Sceptre on a 1-for-1 basis.
Privately owned Fiera will exchange the entirety of its operating assets and related liabilities for 21.1-million Class B common shares of Fiea Sceptre, which will result in a total of 35.1-million Class A subordinate voting shares and Class B shares. After the closing, Fiera will control about 60 per cent of the outstanding shares of Fiera Sceptre.
The transaction is subject to approval of two-thirds of the votes by Sceptre shareholders, and is expected to close this summer. Jean-Guy Desjardins, controlling shareholder of Fiera Capital, will be chairman, chief executive officer and chief investment officer of Fiera Sceptre. David Pennycook, president and interim chief executive officer of Sceptre, will become vice-chairman and executive vice-president.