Here are the top reads on deals and financial services over the week. Have a great weekend!
U.S. cannabis companies raised nearly US$1-billion from equity sales: Massachusetts-based Curaleaf Inc. sold US$400-million of stock in a private placement, chief executive officer Joseph Lusardi said. New York-based Acreage Holdings raised US$350-million and Arizona-based Harvest Enterprises Inc. raised US$200-million, according to investment banking sources. Story (Christina Pellegrini and Andrew Willis, for subscribers)
Rogers Communications nears deal to sell magazines: Rogers Communications Inc. is closing in on a deal to sell almost all of its magazine business, according to multiple sources. The Toronto-based telecommunications and media company is negotiating to sell seven of its digital and print magazine titles − Maclean’s, Canadian Business, Today’s Parent, Hello! Canada, Flare and Chatelaine’s French and English editions. Story (Susan Krashinsky Robertson and James Bradshaw, for subscribers)
Lenders to seize 13 Fortress real estate projects: Senior lenders have moved to seize control of 13 real estate development projects co-ordinated by Fortress Real Developments Inc. as the loans mature or fall into default. A new report from FAAN Mortgage Administrators Inc., a court-appointed receiver that took control of Fortress’s affiliated mortgage brokerage firm, says 24 of the 45 syndicated mortgage loans it is overseeing have matured but the principal has not been repaid, while 13 projects are now facing enforcement actions from senior lenders who rank first on any prospective claim. Story (Janet McFarland, for subscribers)
Instant mortgages are coming soon – what could go wrong? Angelo Mozilo was America’s mortgage king. A butcher’s son from the Bronx, he started in the real estate business at age 14, working as a messenger for a Manhattan lender. After completing university, he founded Countrywide Financial in 1969. The California-based firm eventually became the largest mortgage lender in the United States – a feat fuelled by Mozilo’s decision to automate its loan underwriting system in the 1990s. ROB Magazine (Rita Trichur, for subscribers)
Michael Lee-Chin on why advisers need to step up their game: The billionaire philanthropist, CEO of Portland Holdings and chair of National Commercial Bank of Jamaica, on what turned him against the mutual fund business and why investors should be looking for public companies that act like private ones. ROB Magazine (Dawn Calleja)
Inside the charity network that has helped wealthy donors get big tax breaks – and their donations back: To some, the Vancouver lawyer at the centre of some unusual donation deals involving securities and real estate is ‘a hero of the philanthropy movement.’ Others think the CRA needs to take a closer look. Kathy Tomlinson investigates (for subscribers)
Growing number of BMO customers betting on variable-rate mortgages: Even as the Bank of Canada continues to raise interest rates, more customers at Bank of Montreal are choosing variable-rate mortgages as they begin to feel the pinch of higher borrowing costs. Although most Canadians continue to opt for fixed-rate mortgages, seeking certainty in a changing rate environment, interest charged on variable loans can still be as much as one full percentage point lower. Story (James Bradshaw, for subscribers)
RBC hires high-profile JPMorgan executive to run City National arm: Royal Bank of Canada has hired Kelly Coffey, the head of JPMorgan Chase & Co.’s private bank, to run City National Corp., a move that bolsters its American footprint and sets high expectations for the California-based business. Since RBC acquired City National for $7.1-billion in 2015, the American bank has been run by its long-standing chief executive, Russell Goldsmith, who also became the chair of RBC’s U.S. wealth-management arm after the acquisition closed. Story (Tim Kiladze, for subscribers)
Investors are yanking money out of Canada’s major cannabis ETF: One week after legalization, Canada’s major cannabis ETF has hit a rough patch, experiencing some of its largest daily outflows to date as the industry gets slammed by a broad-based sell-off. As of Tuesday’s close, investors have pulled a net $40-million from the Horizons Marijuana Life Sciences Index ETF (HMMJ) over the five trading days since Canada legalized cannabis for recreational use, according to Bloomberg data. Story (Matt Lundy, for subscribers)
Fiera Capital sells retail mutual funds to Canoe Financial LP: Fiera Capital Corp. is leaving the retail mutual fund industry as it aims to bolster its institutional and private wealth businesses. Fiera Capital announced on Tuesday morning that Canoe Financial LP has agreed to acquire the rights to manage the Fiera Capital mutual fund family, which consists of nine funds and approximately $800-million in assets under management. Story (Clare O’Hara, for subscribers)
Thomson Reuters acquires trade-management platform Integration Point: Thomson Reuters Corp. is buying a software platform for managing global trade flows in the first deal the news and information giant has made since it spun off its largest division as a separate business earlier this month. The agreement will see Thomson Reuters acquire Integration Point, a firm with a 16-year track record in trade management, for an undisclosed sum. The transaction is not considered financially material to Thomson Reuters. Story (James Bradshaw, for subscribers)
Ottawa’s Assent Compliance raises US$100-million from Warburg Pincus: Private equity giant Warburg Pincus LLC has invested US$100-million in Ottawa enterprise software firm Assent Compliance Inc., the latest in a string of large-scale corporate financings this year for Canada’s teeming technology sector. Story (Sean Silcoff, for subscribers)
Many cannabis producers likely to fail, DBRS warns: A leading debt-rating agency has issued a warning about the financial strength of Canadian cannabis companies, arguing that even the biggest among them should have “junk” ratings and that many licensed producers are likely to fail. Story (Tim Kiladze, for subscribers)
Agnico Eagle CEO says gold industry needs more M&A: The tie-up between Barrick Gold Corp. and Randgold Resources Ltd. may mark the start of a wave of needed consolidation in the gold industry, says the head of Canada’s third-largest gold mining company. The sector is struggling with a mismatch between the large number of companies vying for growth and the industry’s narrow pipeline of attractive mine developments, says Sean Boyd, chief executive officer of Agnico Eagle Mines Ltd. Story (Niall McGee, for subscribers)
Wells Fargo focused on Canadian expansion, despite recent scandal: Wells Fargo’s chief executive says the American banking behemoth is looking to expand its Canadian wholesale banking business, as he grapples with the aftermath of a massive sales-practice scandal. Canadian banking is littered with global giants who expand here during boom times, only to turn their backs when a contraction or crisis hits. Reeling from the Great Recession, ING Groep sold its Canadian arm to Bank of Nova Scotia in 2012; a year later, UBS AG also initiated a retreat. Story (Tim Kiladze, for subscribers)
Fortress misled investors about land valuation, RCMP alleges: Officials at Fortress Real Developments Inc. told investors in 2013 that land slated for a new condo development in Winnipeg was worth more than three times the value cited in an independent appraisal commissioned by the company, the RCMP alleges. Story (Janet McFarland, for subscribers)
MORE FINANCIAL SERVICES NEWS AND DEALS NEWS FROM FRIDAY
Gaming sector: Epic Games Inc., creator of popular online video game Fortnite, said on Friday it received US$1.25-billion in funding from investors, including KKR & Co Inc., Iconiq Capital and Smash Ventures. Story (for subscribers)
Energy sector: Chevron Corp has held talks to acquire Pasadena Refining System Inc (PRSI), a Texas oil refining unit of Brazilian state-run oil firm Petroleo Brasileiro SA, three people familiar with the matter said this week. Story
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