Mark Blinc/Reuters
TMX Group Ltd. has sold Equicom Group Inc., its investor relations subsidiary, to National Public Relations Inc. for an undisclosed sum. Equicom has more than 120 publicly traded companies as clients, has offices in Toronto, Calgary and San Diego and was founded in 1986.
TMX bought the formerly independent firm in 2007 and faced criticism at the time that the purchase put the company at risk of a conflict of interest – Equicom's raison d'être is to promote some TSX-listed companies that are clients over others that aren't.
Investor relations services include drafting public documents such as press releases and financial reports, preparing initial public offering roadshow materials, communications and promoting client companies in the media.
"We were always interested in Equicom," said Andrew Molson, chairman of Res Publica Consulting Group, the owner of National. "We approached them."
Mr. Molson says talks between the two sides started in late 2014.
Selling Equicom is one of Lou Eccleston's first major moves since becoming TMX chief executive officer in November, 2014, and is consistent with the company's strategy to focus on its core businesses.
"Lou Eccleston is putting his stamp with a more focused business model," said Shubha Khan, an analyst with National Bank Financial.
"Equicom wasn't much of a growth driver," only accounting for about $15-million in annual revenue, he added.
TMX Group has seen a number of senior management changes in recent months.
Earlier this week, Kevan Cowan, president of TSX Markets and group head of equities, left "to pursue other opportunities" and Brenda Hoffman, group head of information technology, will depart the firm at the end of the month.
Niall McGee