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TMX Group acquiring Equity Financial trust services business for $64-million

The acquisition will diversify TMX’s revenue base, said CEO Tom Kloet.

Peter Power/The Globe and Mail

TMX Group Ltd. is acquiring the transfer agent and corporate trust services business of Equity Financial Holdings Inc. for $64-million.

The operator of Canada's major stock exchanges said Wednesday that it expects the deal to close by early April.

The business currently generates some $17-million in revenue and is expected to immediately add to earnings per share, the TMX said in a release.

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"This acquisition further diversifies our revenue base, opens new growth avenues and provides TMX Group with an even stronger offering for our customers," said CEO Tom Kloet.

"Furthermore, TMX Group is uniquely positioned to build on Equity's success by expanding our relationships with listed companies and the capital markets advisory community."

The Equity business currently offers services to 700 clients, most of which are listed on Toronto Stock Exchange or TSX Venture Exchange.

It also maintains security holder registers, acts as a depositary agent for merger and acquisition transactions and assists issuers in holding meetings of security holders.

"With this acquisition we will further broaden our portfolio of services and enhance the value we can deliver to public companies," said Kevan Cowan, president, TSX markets and TMX Group head of equities.

"We look forward to welcoming the Equity team of professionals to TMX Group and are excited to work with them to expand the business and serve our customers."

TMX Group said the purchase price, subject to certain post-closing adjustments, will be paid for from existing cash and from credit facilities.

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