(Reuters) – Canadian asset management firm IGM Financial Inc said on Wednesday its subsidiary Mackenzie Financial Corp will acquire a 13.9% stake in China Asset Management Co in a C$1.15 billion ($900.55 million) cash deal.
Mackenzie, which will buy the stake from Power Corporation of Canada (PCC), will see its interest in ChinaAMC double to 27.8% following the deal, IGM said. ChinaAMC is a unit of PCC.
IGM — a subsidiary of PCC’s unit Power Financial — said it will sell 15.2 million shares in Great-West Lifeco Inc to PCC for a cash consideration of C$575 million, to partially fund the transaction. It will pay the balance C$575 million cash by tapping into its existing financial resources.
“We believe that an expanded investment in China Asset Management is strategically important to position IGM Financial for further growth,” its President and CEO James O’Sullivan said.
IGM currently holds 37.3 million shares or 4% of the outstanding Lifeco shares, according to its statement.
The transactions are expected to close in the first half of 2022.
($1 = 1.2770 Canadian dollars)
(Reporting by Sabahatjahan Contractor and Anirudh Saligrama in Bengaluru; Editing by Rashmi Aich and Uttaresh.V)
