Jan 30, 2015
Julius Melnitzer, Financial Post, National Post
Manulife’s announcement in September of its $4-billion acquisition of Standard Life Canada was as much a stunning endorsement of the company’s strategy as it was a major acquisition.
The M&A transaction is expected to close shortly. “We’re just waiting on the expected regulatory approvals,” says Terry Burgoyne of Osler, Hoskin & Harcourt LLP, who represented Manulife.
Standard is Manulife’s first acquisition since the financial crisis, the largest acquisition in the Canadian financial institution space in the last 10 years, and the third largest Canadian life insurance acquisition ever. It followed five years of tough choices by Manulife President and CEO Donald Guloien who faced significant headwinds, including a capital crunch, when he took on the job in 2009. Among other decisions, Guloien slashed dividends by some 50% in his first year and in short order raised $2.5-billion in capital as part of a concerted effort to turn around a company whose stock had plummeted to just $10 from about $40 during the financial crisis.
The market certainly liked the transaction. Manulife stock rose 2.6% on the first trading day following the deal’s announcement.
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