Less than two months after categorically refuting suggestions of being in takeover talks with Montréal-based National Bank of Canada, officials at the Winnipeg, Manitoba-based Wellington West have admitted they are indeed going to be acquired by the bank.
National bank of Canada announced earlier today it has agreed to buy the 83% of Wellington West it didn’t already own for $333 million in a bid to expand its asset-management business.
When asked how Wellington went from summarily dismissing takeover suggestions as pure speculation to today’s announcement in less than two months, Kish Kapoor, president of Wellington West Holdings Inc., said pace is one of Wellington’s key properties.
“We pride ourselves on moving quickly once we decide; that is the mark of a great entrepreneurial firm,” said Kapoor.” And Wellington West is just that.”
“National Bank did not have to take long to understand who we are and since we have known them a long time – this was a no-brainer once we knew the proposal made sense for all.”
National Bank, the country’s sixth-biggest bank, already holds nearly 17% stake in Wellington and has long been expressing an interest in the firm’s business.
In a memo circulated on March 30, the staff and shareholders of Wellington were assured that the news about takeover talks was mere speculation and that “we will always have the last word on what is right for all of us.”
“Well, last week we did have something to say to them,” said Kapoor in a direct reference to the March memo. “So, we invited our key shareholders and asked them for their view; over 95% of the people in attendance indicated that the overall proposition tabled by National Bank made sense for our shareholders, our employees, our clients and our many other stake holders as it allowed us to continue to participate in a sound growth story going forward with minimal disruption.”
With the support of stakeholders and the recommendation of senior management, the board announced the agreement to all shareholders, said Kapoor adding “subject to variety of approvals including shareholders and regulators, we will move towards the closing by mid July.”
The merger is a well managed and inclusive process and the transaction is best for Wellington and National Bank, he added.
Luc Paiement, Executive Vice President Wealth Management NBFG, Co-President and Co-CEO of National Bank Financial, said the acquisition will contribute to the continued growth of National Bank’s wealth management platform.
“It also aligns with National Bank’s strategy to increase its scale and presence outside of Quebec,” said Paiement. “Our two organizations share a distinctive entrepreneurial culture with complementary operations; the combination adds to National Bank’s geographic diversity and makes us a stronger national organization.”
This transaction, he added, marks the natural evolution of a mutually successful partnership.
Charlie Spiring, CEO and founder of Wellington West, said in a public announcement that the transaction will move the firm “light years ahead.”
“We are in a highly competitive and rapidly consolidating industry with a changing regulatory landscape,” he said. “Size, scale and a strong balance sheet matter [and] with the financial strength and infrastructure of National Bank, we can provide even better support to our clients and grow our practices without boundaries.”