Fiera Capital acquires Centria Commerce Inc. establishing its own private lending offering


/Not for distribution to U.S. newswire services or for dissemination in the United States/

MONTREAL, Nov. 10, 2016 /CNW Telbec/ - Fiera Capital Corporation ("Fiera Capital" or the "Firm") (TSX: FSZ) announced that it has acquired today Centria Commerce Inc. ("Centria"), a leading Quebec-based private investment manager that establishes and manages funds providing construction financing, real estate investment and short-term business financing, from DJM Capital Inc. ("DJM", and such transaction, the "Transaction"). Fiera Capital will integrate Centria as its own private lending platform, bringing a major alternative investment portfolio in-house and allowing Fiera Capital to now offer its own diversified investment solutions directly to clients. Fiera Capital's new private lending platform will be called Fiera Private Lending.

Centria was first acquired in 2002 by a predecessor of DJM and Fiera Capital has worked closely with the team since 2008. Fiera Capital's private wealth clients have provided substantially all of the funds invested by Centria in its private lending activities. Almost all of Centria's approximately C$325 million of net assets under management ("AUM") form part of Fiera Capital's existing client assets.

"The Centria team is well known to Fiera Capital and has earned our confidence. Thanks to its talented team and strong governance process, Centria has built a portfolio with outstanding risk-reward characteristics, stable returns and an extremely low default rate. They have delivered attractive returns to our clients," said John Valentini, Executive Vice President and Chief Financial Officer of Fiera Capital. "As a leading independent investment management firm, Fiera Capital is exceptionally well-positioned to take advantage of the growing alternative investment universe. We expect to see significant interest and growth for this asset class."

Jean Gamache, President and Chief Operating Officer of Centria added: "With this transaction, we are bringing to Fiera Capital a seasoned team in construction financing, real estate investment and short-term business financing. Our knowledge of underwriting, loan origination, and research as well as our execution capabilities bring a set of competencies that we believe will be valuable to other Fiera Capital teams and benefit the Firm as a whole."

Purchase Consideration and Other Terms and Implications of the Transaction

Total consideration paid at closing for Centria was C$33 million, subject to certain customary adjustments, C$10 million of which was paid in cash and the balance by the issuance of 1,944,211 Fiera Capital Class A subordinate voting shares ("Class A Shares") at a deemed price of C$11.83 per share determined using a ten day aggregated volume-weighted average per share price. Additional consideration of up to C$12 million may be paid in Class A Shares over a period of 3 calendar years following the closing (the "Earn-Out Period") if certain AUM, revenue and earnings before interest, taxes, depreciation and amortization ("EBITDA") targets are met at a price per share to be determined on the same averaged basis. The issuance of Class A Shares to DJM at closing and during the Earn-Out Period was conditionally approved by the Toronto Stock Exchange. The Transaction is expected to be immediately accretive to Fiera Capital's adjusted earnings per share in 2016.

Fiera Capital Board of Directors and Special Committee Review

DJM is indirectly owned as to 80% by Jean-Guy Desjardins, Chairman and CEO of Fiera Capital, and as to 20% by entities controlled by Jean C. Monty, a member of Fiera Capital's board of directors (the "Board"). DJM also indirectly owns 63.33% of the issued and outstanding shares of Fiera Holdings Inc., the sole general partner of Fiera Capital L.P. Fiera Capital L.P. holds all of the issued and outstanding Class B special voting shares of Fiera Capital ("Class B Shares") and Fiera Holdings Inc., as general partner of Fiera Capital L.P., determines how such Class B Shares are voted. Holders of Class B Shares are entitled, voting separately as a class, to elect two-thirds of the members of the Board.

The Transaction constitutes a "related party transaction" as defined under Regulation 61-101 respecting Protection of Minority Shareholders in Special Transactions ("Regulation 61-101"). Due to the related party nature of the Transaction, a special committee (the "Special Committee") of independent members of the Board was formed, composed of David Shaw, Chairman, Brian Davis, Raymond Laurin and Arthur Scace. The Special Committee was appointed to, among other things, consider the Transaction, provide advice and guidance to the Board as to whether the Transaction is in the best interests of Fiera Capital and make recommendations to the Board and, with the assistance of its independent legal and financial advisors, review and negotiate the terms and conditions of the definitive documentation required to give effect to the Transaction. Norton Rose Fulbright Canada LLP acted as independent legal counsel to the Special Committee and Ernst & Young LLP ("E&Y") acted as independent financial advisor to the Special Committee.

The Board determined that the Transaction was exempt from the minority shareholder approval and formal valuation requirements of Regulation 61-101 by virtue of the market capitalization exemption from those requirements. Although technically exempt from the formal valuation requirements of Regulation 61-101, the Special Committee nonetheless engaged E&Y to prepare an independent valuation of Centria and to provide a fairness opinion.

The Special Committee unanimously determined that in its view the Transaction is fair to Fiera Capital's shareholders and is in the best interests of Fiera Capital, and unanimously recommended that the Board authorize management of the Firm to conclude the Transaction. The independent members of the Board (excluding Jean Monty) accepted such recommendation and approved the Transaction.

During the Earn-Out Period, the operation and management of Centria and its funds will be overseen by a board of directors composed entirely of individuals approved by a majority of the independent members of the Board, and the relationship between Centria and Fiera Capital will also be the subject of ongoing reporting to, and oversight by, the independent members of the Board during this period. Fiera Capital will also be providing certain additional financial disclosure with respect to the Centria-Fiera Capital relationship in its continuous disclosure documents during the Earn-Out Period.

Immediately before the closing of the Transaction, Jean-Guy Desjardins owned no Class A Shares. Following the closing of the Transaction, Jean-Guy Desjardins beneficially owns 1,555,369 Class A Shares, representing approximately 2.6% of the issued and outstanding Class A Shares. Assuming the conversion of his beneficially owned 7,195,714 Class B Shares into Class A Shares, Jean-Guy Desjardins would beneficially own 8,751,083 Class A Shares, representing approximately 12.9% of the then issued and outstanding Class A Shares, and 10.9% of all of the then issued and outstanding shares of the Corporation.

An early warning report with additional information in respect of the Transaction will be filed and made available on SEDAR at under Fiera Capital's issuer profile. In order to obtain a copy of the early warning report, you may also contact Ms. Violaine Des Roches, Senior Vice-President, Legal Affairs and Compliance at Fiera Capital, at telephone number: (514) 954-3750. Fiera Capital's head office and Jean-Guy Desjardin's address for these purposes is 1501 McGill College, Suite 800, Montreal, Quebec H3A 3M8.

Forward-Looking Statements

This document may contain certain forward-looking statements. These statements relate to future events or future performance, and reflect management's expectations or beliefs regarding future events, including business and economic conditions and Fiera Capital's growth, results of operations, performance and business prospects and opportunities. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. In some cases, forward-looking statements can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", "target", "intend" or the negative of these terms, or other comparable terminology.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and a number of factors could cause actual events or results to differ materially from the results discussed in the forward-looking statements. In evaluating these statements, readers should specifically consider various factors that may cause actual results to differ materially from any forward-looking statement.

These factors include, but are not limited to, market and general economic conditions, the nature of the financial services industry, and the risks and uncertainties detailed from time to time in Fiera Capital's interim and annual consolidated financial statements, and its Annual Report and Annual Information Form filed on These forward-looking statements are made as of the date of this document, and Fiera Capital assumes no obligation to update or revise them to reflect new events or circumstances, except as required by applicable law.

With respect to management expectations regarding accretion on adjusted EPS resulting from this transaction in 2016, financial performance is based on information available to management and certain assumptions, including the accuracy of Centria's financial statements, the level of client assets under management with Centria following the acquisition, as well as assumptions regarding the growth in Centria's assets under management and realization of synergies. Actual results could differ depending on a number of factors, including the ability to retain key personnel following the acquisition, general market conditions and currency fluctuations.

Non-IFRS Measures

This press release makes reference to adjusted EPS of Fiera Capital, which is a non-IFRS measure. Adjusted EPS is not a recognized measure under IFRS, does not have a standardized meaning under IFRS and is unlikely to be comparable to similar measures used by other companies. The rationale for the use of non-IFRS measures is presented in Fiera Capital's Management's Discussion and Analysis (MD&A), which is available on SEDAR at

About Fiera Capital Corporation

Fiera Capital is a leading North American independent asset management firm with more than C$112 billion in assets under management as at September 30, 2016. The Firm provides institutional, retail and private wealth clients with access to full-service integrated money management solutions across traditional and alternative asset classes. Clients and their portfolios derive benefit from Fiera Capital's depth of expertise, diversified offerings and outstanding service. Fiera Capital trades under the ticker FSZ on the Toronto Stock Exchange.

In the U.S., asset management services are provided by the Firm's US affiliates, Bel Air Investment Advisors LLC and Fiera Capital Inc., investment advisers that are registered with the U.S. Securities and Exchange Commission (SEC). Registration with the SEC does not imply a certain level of skill or training. Additional information about Fiera Capital Corporation, including the Firm's annual information form, is available on SEDAR at


SOURCE Fiera Capital Corporation