Manulife to acquire Comvest Credit Partners in $937.5 million deal

TORONTO - Manulife Financial Corporation (TSX:MFC), a prominent player in the insurance industry with a track record of strong returns over the past five years according to InvestingPro, announced Wednesday it has signed an agreement to acquire 75% of Comvest Credit Partners for US$937.5 million in upfront consideration, with plans to create an US$18.4 billion private credit asset management platform.

The transaction combines Comvest’s US$14.7 billion middle market direct lending platform with Manulife’s existing US$3.7 billion Senior Credit team. The resulting platform will be co-branded as Manulife | Comvest, according to the press release statement. Manulife brings significant financial strength to this partnership, with InvestingPro data showing liquid assets exceeding short-term obligations and consistent profitability over the last twelve months.

Robert O’Sullivan, Co-Founder and CEO of Comvest, will lead the newly aligned business, while Michael Falk, Founder of Comvest, will transition to a role as Senior Advisor and Board Member.

"This partnership is an important step forward for Comvest and will meaningfully strengthen our market position," O’Sullivan said.

The companies described their businesses as complementary, with Comvest focusing on non-sponsor backed middle market direct lending and specialty lending, while Manulife has established relationships in the private equity sponsor-backed market.

In addition to the upfront payment, Comvest may receive up to US$337.5 million in additional consideration contingent on meeting certain performance targets. The agreement includes provisions for Manulife to purchase the remaining 25% through a put/call mechanism.

Manulife stated the acquisition will be funded entirely with cash on hand, resulting in less than a 3-point reduction to its LICAT ratio. The transaction is expected to be immediately accretive to core EPS, core ROE, and core EBITDA margin. The company’s strong financial position is underscored by its impressive 26-year streak of maintaining dividend payments, with 11 consecutive years of dividend increases, as reported by InvestingPro.

The deal is expected to close in the fourth quarter of 2025, subject to customary closing conditions and approvals.

Morgan Stanley & Co. LLC is acting as exclusive financial advisor to Manulife on the transaction, with Skadden, Arps, Slate, Meagher & Flom LLP serving as legal advisor.

In other recent news, Manulife Financial Corporation has announced the declaration of quarterly dividends on its non-cumulative preferred shares. These dividends will be distributed to shareholders of record as of August 20, 2025, and will be payable on or after September 19, 2025. Manulife’s Board of Directors specified dividend amounts for various share classes, including $0.29063 per share for Class A Series 2 and $0.28125 per share for Class A Series 3. Additionally, dividends were declared on several Class 1 shares, with amounts ranging from $0.14675 to $0.396875 per share, depending on the series. These developments highlight Manulife’s ongoing commitment to providing returns to its investors through regular dividend payments.

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