TORONTO - CI Financial Corp . (TSX: TSX:CIX) has disclosed a definitive agreement with Mubadala Capital, the alternative asset management arm of Mubadala Investment Company, to be taken private in a substantial transaction. The deal values CI at about $4.7 billion in equity and suggests an enterprise value of nearly $12.1 billion. Shareholders are poised to receive $32.00 per share in cash, marking a 33% premium over the last closing price and a 58% premium over the 60-day volume-weighted average price on the Toronto Stock Exchange.
The board of CI, with the exception of interested directors, has unanimously endorsed the transaction, which was also unanimously recommended by a special committee of independent directors. They advise CI shareholders to vote in favor of the agreement, which they believe offers a significant cash premium and certainty for shareholders.
CI's CEO, Kurt MacAlpine, will continue to lead the company, which will maintain its current structure, management team, and independence from Mubadala Capital's other portfolio businesses. The transaction is designed to support CI's ongoing strategy to become a leading wealth and asset manager and provides long-term stable capital for the company.
The transaction also aims to bolster CI’s expansion in the U.S. market, where it operates under the Corient brand. CI will retain its Canadian headquarters and continue its operations and structure in Canada, including its technology and data protection practices.
The proposed acquisition will proceed through a plan of arrangement, requiring approval from CI shareholders at a special meeting expected in January 2025, as well as court and regulatory clearances. Subject to these approvals, the transaction is anticipated to close in the second quarter of 2025.
CI has agreed to customary terms, including a non-solicitation covenant with "fiduciary out" provisions, allowing CI to consider superior proposals, with Mubadala Capital retaining a right to match. Termination fees are set at $150 million payable by CI and a reverse termination fee of $225 million payable by Mubadala Capital under certain conditions.
CI's shares will be delisted from the Toronto Stock Exchange post-closing, but it is expected to remain a reporting issuer due to its outstanding debentures and notes. The financing for the transaction is structured to maintain CI’s investment grade debt ratings.
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