TD Bank Group is acquiring Greystone Capital Management Inc., the parent company of Greystone Managed Investments Inc., for $792 million.

The agreement, which is subject to regulatory approval, comprises $730 million of enterprise value, about $105 million of seed capital and other net adjustments.

Greystone Capital Management’s shareholders will receive 30 per cent of the net purchase price in common TD Bank shares, with the remainder payable in cash consideration. Shareholders will also be able to opt up to an incremental 20 per cent of the net purchase price in TD shares to a maximum of 50 per cent.

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“This acquisition is an exciting step for TD Asset Management,” said Bruce Cooper, chief executive officer and chief investment officer of TD Asset Management, in a news release. “Greystone’s high-quality team will bring its strengths in fixed income, equities and real asset investing to TD and will provide our institutional business with an enhanced set of capabilities.

“The compatible cultures and investment philosophies shared by TD and Greystone will allow our organizations to build on existing strengths, broaden our expertise and offer better, more comprehensive investment solutions for our collective clients, including the opportunity to work together to launch a global real estate fund.”

Following the transaction, TD will have about $393 billion in assets under management, adding Greystone’s $36 billion to its existing $357 billion. The deal will make TD Asset Management the largest money manager in Canada.

“At TD Wealth, we continually look for opportunities to strategically grow our North American business to offer clients a superior wealth management experience,” said Leo Salom, group head of wealth management and TD Insurance at TD Bank Group. “Greystone’s leadership in alternative investments is a perfect complement to TD Asset Management’s traditional investment products. Their robust suite of proven alternative and traditional investment solutions, combined with the scope and strength of TD’s existing offerings, will provide clients with compelling solutions to enhance their current portfolios.”

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After the acquisition, which is expected to close in the second half of 2018, Greystone will be known as TD Greystone Asset Management and will continue its operations out of Regina.

“Joining forces with TD will add tremendous value to Greystone clients interested in expanding and diversifying their investment portfolios,” said Robert Vanderhooft, chief executive officer and chief investment officer of Greystone. “TD’s core values, combined with its progressive employee culture and long-term investment philosophies are in perfect alignment with Greystone. We look forward to joining such a well-respected organization.”

Copyright © 2018 Transcontinental Media G.P. Originally published on benefitscanada.com

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