MONTREAL, QUEBEC – Laurentian Bank of Canada (“the Bank”) (TSX: LB) announced today that it has entered into a definitive agreement pursuant to which a subsidiary of the Bank Has agreed to acquire Northpoint Commercial Finance, one of the largest US and Canadian lenders in the inventory financing sector, with a portfolio of approximately $ 1.2 billion as at March 31, 2017. Closing Of the transaction is expected to occur before the end of 2017, subject to customary closing conditions including applicable regulatory notices and approvals.
The Bank considers Northpoint Commercial Finance, founded in 2012, to be one of the few diversified inventory financing companies with the scale needed to meet the needs of North American manufacturers and their distributor networks.
“We are pleased to announce this acquisition, which will increase the proportion of revenues from Business Services within the Bank, which should improve overall profitability,” said Francois Desjardins, President and Chief Executive Officer of Laurentian Bank from Canada. “The realization of the initiatives of our transformation plan is progressing very well, including the optimization of Personal Banking and the development of our central banking system, the cornerstone of our digital offering. “
“This acquisition represents an excellent strategic complement to the operations of our capital equipment subsidiary, LBC Capital, resulting in an attractive end-to-end financing platform. It enhances our service offering in Canada and establishes a US presence, an important customer characteristic for manufacturers and distributors looking for a single North American point of service, “added Stephane Therrien, Executive Vice President, Services Businesses and individuals of the Laurentian Bank. “The members of the Northpoint team, led by CEO Dan Radley, have years of experience in inventory financing, A unique expertise in the market and strong relationships with customers who are leading companies. We are very pleased to welcome them as they join the team under the leadership of A�ric Provost, Senior Vice President, Commercial Financing, Laurentian Bank and President of LBC Capital. “
The Bank estimates that the acquisition will increase its earnings per share from the first full year of operation and approximately 4% in 2019. Given the expected assets at closing and the associated equity financing, Tier 1 capital ratio in the form of the Bank’s Basel III common shares would be maintained within the recommended range of 7.8% to 8.2%. The Bank plans to finance the acquisition through equity financing in the form of subscription receipts in the amount of $ 225 million (“equity financing”) and existing liquidity on the balance sheet.
(I) All amounts in dollars are expressed in Canadian dollars.
The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933 , as amended (the “1933 Act”), or the securities legislation of State of the United States and may not be offered or sold in the United States or to persons in the United States without registration, except pursuant to an exemption from the registration requirements of the 1933 Act and Applicable state securities. The securities will not be offered to the public in the United States. This press release does not constitute an offer to sell or the solicitation of an offer to purchase securities in any jurisdiction. No securities regulatory authority has approved or disapproved of the contents of this press release.
A conference call will be held at 5:00 pm (ET) on May 18, 2017.
Toll-free number 1 888 349-9618, code 6705639, allows you to listen to this conference live, in listening mode only.
The recording of this conference call will be available later on the Bank’s website, under Laurentian Bank, Investors, Presentations and Events.
The documents referred to during the conference will be available on the Bank’s website under the Laurentian Bank, Investors, Presentations and Events tab.
About Laurentian Bank
Laurentian Bank of Canada is a financial institution with operations across Canada. Founded in 1846, its mission is to help its clients improve their financial health and is guided by its values of proximity, simplicity and honesty.
It serves one and a half million customers across the country and employs more than 3,600 people, making it a major player in several market segments. The Bank serves the needs of individuals through its branch network in Quebec. It is also known for its expertise in small and medium-sized businesses and real estate developers, thanks to its specialized teams located throughout Canada. Its subsidiary B2B Bank is a leading Canadian provider of banking products and services and investment accounts through financial advisors and brokers. Laurentian Bank Securities offers full-service brokerage services to institutional and retail clients.
The Bank manages over $ 43 billion in balance sheet assets, as well as over $ 32 billion in administered assets.
About Northpoint Commercial Finance
Headquartered in Alpharetta, Georgia, with approximately 90 employees, Northpoint Commercial Finance has a leading position in the financing of a range of products in important sectors through relationships with hundreds of manufacturers and Thousands of distributors in the United States and Canada. Headed by an experienced team with an average of 25 years of experience, Northpoint offers diversified financial solutions such as Inventory Loans and Inventory Financing. As an informed lender, Northpoint offers a wide range of program structures to meet the needs of initial manufacturers, distributors and resellers in a variety of commercial product sectors. The Team offers a creative, flexible and personalized approach, combined with innovative technologies and simplified processes.
Source: Laurentian Bank of Canada