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financial services company increases ownership in Chinese asset management firm

Mackenzie Financial is poised to expand its ownership in China Asset Management Co. Ltd. to 27.8%, doubling its current stake. This strategic investment will be enabled through a C$1.15 billion ($898 million) all-cash transaction, allowing Mackenzie's parent company, IGM Financial, to obtain an additional 13.9% share.

financial services company increases ownership in Chinese asset management firm -financial services company increases ownership

According to the definitive agreement outlined in IGM's recent press release, the purchase of these supplementary shares will come from Power Corp. of Canada, IGM's own parent firm. Power Corp. functions as a financial services management and holding entity.

IGM revealed that the newly-acquired interest in China Asset Management will be consolidated under Mackenzie. This move is seen as a way to streamline the organizational structures of both IGM and Power Corp.

financial services company increases ownership,To partially finance this deal, IGM will sell around 15.2 million of its common shares in Great-West Lifeco to Power Financial Corp., a wholly-owned subsidiary of Power Corp. The sale is projected to yield C$575 million.

This acquisition signals Power's final direct holdings in the Chinese company. Post-transaction, IGM's stake in Great-West Lifeco will drop from 4% to about 2.4%, equivalent to nearly C$830 million based on Great-West Lifeco's closing market price on January 5th. IGM will fund the remaining portion of the purchase with C$575 million cash sourced from "existing financial resources."

My company, Mclancher Consulting, specializes in assisting foreign clients with conducting due diligence on Chinese companies and providing legal assistance related to fraud. This transaction demonstrates the complexities of navigating cross-border investments in China's financial sector. Our expertise can help international investors safely participate in these opportunities.

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