Fiera Capital's senior management solidifies ownership by acquiring Desjardins' shares, aligning with strategic goals
Fiera Capital Corporation has announced that its senior management and some board members have acquired all units of Fiera Capital L.P. and all shares of Fiera Holdings Inc. previously held by Desjardins Financial Holding Inc in an approximately $53m transaction.
The transaction, involving no outside buyers, represents 7,257,960 Class B voting shares and Class A subordinate voting shares, or 6.8 percent of total outstanding shares.
This acquisition follows the April announcement reported by Wealth Professional that Desjardins intended to sell its units of Fiera LP and shares of Fiera Holdings. Unitholders were granted a right of first refusal to purchase the offered securities per the limited partnership agreement governing Fiera LP.
Maxime Ménard, president and CEO of Fiera Canada and Global Private Wealth, emphasized the significance of this transaction.
“It came at a point where we've had mutual conversations where management is looking for an opportunity to put together an ability to buy the block. This is a fairly illiquid position, so having a block available for management to buy in, is something I strongly believe in,” Ménard says.
This acquisition allows Fiera Capital’s senior management team to solidify their investment in the firm's future, aligning their interests and long-term incentives directly with the Company’s strategic goals through increased ownership stakes.
“Desjardins has been a supportive and valued partner since our inception, backing us over the last two decades,” said Jean-Guy Desjardins, chair of the Board and global chief executive officer. “Despite the repurchase of shares, Desjardins continues to be a valued client, and we look back with satisfaction on our successful partnership.”
Guy Cormier, president, and CEO of Desjardins Group, stated, “This transaction aligns with our investment strategy. Fiera Capital remains an important business partner for Desjardins. We will continue our business relationship with Fiera, particularly in managing our trust funds.”
Ménard noted that the Desjardins holding was a longstanding but not a core position for Desjardins Financial. He emphasized that this exit would not impact Fiera’s growth plans, citing the firm’s existing AUM of over $165bn.
The current growth plans should not require the over-investment typical of firms seeking to achieve scale.
Following the announcement in late April, Fiera’s stock dropped by around ten percent. Ménard contextualizes this move within the relatively strong performance of Fiera stock, up over 17 percent since January, and notes the broad equity market pullback in April.
As Fiera’s management team finalizes their offering, Ménard highlights ongoing conversations about growing their asset base and reinvesting in the business. He aims to attract top portfolio management teams, leveraging Fiera’s technology, operations, and distribution.
The opportunity to purchase these shares is sparking discussions with internal stakeholders about Fiera’s focus and direction.
“We've been able to communicate our strategy and finalized our five-year plan for growth through an increase in AUM, innovations, and business investments. Our shareholder base enables us to buy that position, commit management to shareholders, and support a solid five-year plan tied to share performance,” Ménard says.
