AGF’s Long-term Investment in the U.K. Delivers Strategic Value to Its Shareholders

• Total expected cash and equity proceeds of C$320 million
• AGF to retain approximately 2.3% interest in the newly combined entity

TORONTO, Sept. 19, 2019 (GLOBE NEWSWIRE) -- AGF Management Limited (TSX:AGF.B) today confirms a merger between Smith & Williamson and Tilney to create the U.K.’s leading integrated wealth management and professional services group with over £45 billion in assets under management and £500m of revenues.

“AGF would like to congratulate Smith & Williamson and Tilney on this new partnership,” said Blake C. Goldring, Executive Chairman, AGF Management Limited. “As a long-standing board member at Smith & Williamson it has been exciting to see and be a part of the evolution of the firm. A merger of this stature accelerates both firms’ growth strategies and builds a leadership position that can capture significant industry opportunities.”

“The merger also delivers on AGF’s long-term investment strategy in the U.K. while providing us the opportunity to participate as an investor in a new company that is set up to be a market leader,” added Mr. Goldring.

AGF first entered the U.K. private client space with an initial investment in U.K.-based private client asset manager NCL (Securities) Limited in 1998, which later led to making a further investment into an enlarged company created by the merger of NCL and Smith & Williamson in 2002.

“Now is the right time to realize the value of our long-term investment,” said Kevin McCreadie, Chief Executive Officer and Chief Investment Officer, AGF. “The return on our investment gives us the flexibility to redeploy capital in a number of ways, including funding future share buybacks, servicing debt repayment and continuing to invest in new areas of growth ensuring our resources remain focused against our stated strategic goals and delivering continued value for our shareholders.”

Based on the terms of the arrangement, AGF estimates that the transaction will result in total cash and equity proceeds of approximately £193.2 million (approximately C$320 million), excluding one-time expenses and subject to closing adjustments, compared to an estimated book value at closing of C$137.5 million. 

Prior to closing, AGF is expected to receive a special cash distribution estimated to be £19.8 million (approximately C$33 million). At closing, AGF will receive cash proceeds of £147.4 million (approximately C$244 million) and retain approximately 2.3% interest in the newly combined entity. AGF has entered into a hedge at a strike price of 1.6130 to protect AGF’s cash consideration if the British pound declines below that level. The hedge expires March 31, 2020.

The transaction is anticipated to close early 2020, subject to regulatory approvals. The merged business will be named Tilney Smith & Williamson upon completion.

AGF was advised on the transaction by Spencer House Partners LLP and DAC Beachcroft LLP.

All Canadian dollar figures assume an exchange rate of 1.6542.

About AGF Management Limited

Founded in 1957, AGF Management Limited (AGF) is a diversified global asset management firm with retail, institutional, alternative and high-net-worth businesses. As an independent firm, AGF strives to help investors succeed by delivering excellence in investment management and providing an exceptional client experience. AGF’s suite of diverse investment solutions extends globally to a wide range of clients, from financial advisors and individual investors to institutional investors including pension plans, corporate plans, sovereign wealth funds and endowments and foundations.

AGF has investment operations and client servicing teams on the ground in North America, Europe and Asia. With over C$37 billion in total assets under management, AGF serves more than one million investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B.

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