The Caisse de dépôt et placement du Québec is cashing in on the strong stock-market performance of CGI Inc. by selling shares in the company for more than $400-million.
The giant pension fund portfolio manager – CGI's biggest single shareholder – said on Tuesday it is reducing its stake by almost 10 million shares. It says the move is "consistent with the portfolio rebalancing policy of la Caisse."
As part of the deal, Montreal-based information technology firm CGI – which recently made headlines over the problem-riddled web launch of the Obamacare health care plan in the U.S. – will buy back 25 per cent of the shares being sold by the Caisse at a price of $40.15 per share. The balance is being sold at the same price to an unnamed brokerage firm.
The sale adds up to a profit of more than $186-million for the Caisse, which boosted its stake in CGI last year by purchasing shares at $21.41 each in a $1-billion investment in the company as part of the financing of the latter's acquisition of U.K.-based Logica PLC.
"CGI's solid performance and flawless integration of Logica have generated an exceptional return on our investment. The timing is right to capture a small portion of it for our depositors," said Caisse president and chief executive officer Michael Sabia.
Once the transaction is completed, the Caisse will hold about 18.7 per cent of the outstanding CGI shares.
"La Caisse has been a key partner of CGI's for more than three decades," CGI president and chief executive officer Michael Roach said.
"We are confident that, as a major shareholder and client, our partnership will continue to grow for years to come."
The $40.15 per share sale represents a 1.40 per cent discount to CGI shares' closing price on the Toronto Stock Exchange on Nov. 25, the Caisse said.