What's Happening?
First National Financial Corporation has announced that its shareholders have approved a plan of arrangement for the acquisition of all outstanding shares by a newly-formed acquisition vehicle. This vehicle is controlled by private equity funds managed by Birch Hill Equity Partners Management Inc. and Brookfield Asset Management. The acquisition plan, which was approved by 98.82% of the votes cast by shareholders, involves purchasing shares at $48.00 each in cash. The plan excludes shares owned by the company's founders, Stephen Smith and Moray Tawse, and their affiliates. The transaction is subject to final court approval and other conditions, with a hearing scheduled for October 3, 2025.
Why It's Important?
The approval of this acquisition plan is significant as it represents a major shift in ownership for First National Financial Corporation, one of Canada's largest non-bank mortgage originators and underwriters. The transaction could impact the company's strategic direction and operations, potentially affecting its employees, customers, and the broader mortgage market. The involvement of major private equity firms suggests a focus on leveraging First National's substantial mortgage portfolio, which could lead to changes in business strategy or expansion efforts. The transaction's completion is contingent on regulatory approvals, which could influence the timeline and final outcome.
What's Next?
The next steps involve obtaining a final order from the Ontario Superior Court of Justice and meeting other closing conditions outlined in the arrangement agreement. If these conditions are satisfied, the transaction is expected to close in the fourth quarter of 2025. Stakeholders, including employees and customers, will be closely monitoring the situation for any changes in company policy or strategy post-acquisition. The market will also be watching for any regulatory challenges or delays that could impact the transaction's completion.
