National Bank has agreed to buy TD’s institutional services business for $250 million, subject to a price adjustment mechanism based on asset retention.
“Through this acquisition, we will extend our reach by adding over 260 additional market intermediaries who serve over 130,000 client accounts and manage approximately $34 billion in assets,” says Luc Paiement, National Bank’s co-president and co-CEO and executive vice-president of wealth management.
TD Waterhouse Institutional Services provides back-office solutions—including custody, trading, clearing, settlement and recordkeeping—for independent Canadian-based registered portfolio managers and introducing brokers.
The transaction is expected to increase National Bank’s 2014 and 2015 recurring earnings per share by $0.12 and $0.14, respectively, assuming full benefit of the acquisition in fiscal year 2014.
The deal, which is subject to regulatory approvals and other transaction terms and conditions, is expected to close later this year.
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