Canaccord Genuity Group Inc. · TSX:CF
Canaccord Genuity — Canaccord Financial — Merger or Acquisition (December 2011)
39 slides from Canaccord Genuity's merger presentation, Dec 15, 2011
Slide 1: Proposed Acquisition of Collins Stewart Hawkpoint
PROPOSED ACQUISITION OF COLLINS STEWART HAWKPOINT Creating a leading independent global investment bank December 15, 2011 INVESTOR & ANALYST WEBCAST
Slide 2: Caution Regarding Forward Looking Statements
Caution Regarding Forward Looking Statements This presentation may contain certain forward-looking statements. These statements relate to future events or future performance and reflect management’s expectations regarding Canaccord’s growth, results of operations, performance and business prospects
Slide 3: Disclaimer
Disclaimer This presentation does not constitute a prospectus or admission document relating to Canaccord, nor does it constitute or form part of any offer or invitation to purchase, sell or subscribe for, or any solicitation of any such offer to purchase, sell or subscribe for, any securities in Ca
Slide 4: Creating a leading independent global investment bank
Creating a leading independent global investment bank Canaccord Financial Inc. has offered to acquire 100% of Collins Stewart Hawkpoint plc • Agreement to acquire 100% of the equity of Collins Stewart Hawkpoint (“Collins Stewart”) • Consideration of £0.96 per share, to be provided as a combination o
Slide 5: Summary of Transaction Terms
Summary of Transaction Terms • Canaccord Financial Inc. has offered to acquire 100% of Collins Stewart Hawkpoint plc, by way of Scheme of Arrangement, contingent Proposed Transaction on Collins Stewart shareholder approval and certain regulatory approvals Consideration • Consideration of £0.96 per s
Slide 6: Meeting Canaccord's Strategic Partnership Criteria
Meeting Canaccord’s Strategic Partnership Criteria Strong Strategic Fit • Creates a leading independent investment bank and wealth manager in the UK • Adds top-flight UK and European advisory franchise; complementary to Canaccord’s global effort • Expands Canaccord Genuity’s US business, adding scal
Slide 7: CF Listing on the London Stock Exchange
CF Listing on the London Stock Exchange Listing on the LSE will enhance Canaccord’s prominence with UK and European investors • Currently dual listed on the TSX and AIM markets (CF: TSX, CF.:AIM) • Intend to move Canaccord’s UK listing to the LSE main market after the transaction closes – CSHP share
Slide 8: Canaccord Post-Acquisition
CANACCORD POST-ACQUISITION Canaccord’s global operations at a glance, after the close of our proposed acquisition
Slide 9: Building a Stronger Global Business: Pro Forma Combined Performance
Building a Stronger Global Business: Pro Forma Combined Performance PRO FORMA COMBINED COMPANY PERFORMANCE C$ Millions, pro forma revenue for business divisions for 12 months ended June 30, 2011 Canaccord Collins Stewart Hawkpoint $1.17 billion $1,200 $1,200 $1,000 $1,000 $357.4 $810.7 $800 $800 $27
Slide 10: Growing Global Wealth Management Operations
Growing Global Wealth Management Operations WEALTH MANAGEMENT OPERATIONS IN FOUR GEOGRAPHIES Differentiated Wealth Management Businesses Canada Canaccord Wealth Management to Capture value in their specific geographies UK and Europe Canaccord Wealth Management Australia Canaccord BGF • Canaccord Wea
Slide 11: Expanding our Global Capital Markets Team: Combined Scale
Expanding our Global Capital Markets Team: Combined Scale Transaction benefits all Canaccord business lines PRO FORMA COMBINED GLOBAL CAPITAL MARKETS PERFORMANCE C$ Millions, pro forma revenue for certain business lines for 12 months ended June 30, 2011 • The acquisition of Collins Stewart is expect
Slide 12: Expanded Pan-European Capital Markets Capabilities
Expanded Pan-European Capital Markets Capabilities Bolsters the strength of our UK and European capital EXPANDED UK AND EUROPEAN OPERATIONS UK /European Holding Company Canaccord Genuity Ltd. markets team Advisory Canaccord Genuity Hawkpoint • Expands Canaccord Genuity’s institutional coverage in Eu
Slide 13: Building Scale in the United States
Building Scale in the United States Highly complementary additions to Canaccord STRONG CAPITAL MARKETS PRESENCE IN NORTH AMERICA Canada Canaccord Genuity Corp. Genuity’s US operations United States Canaccord Genuity Inc. • Full range of equities coverage from all market caps and 16 focus sectors • C
Slide 14: Developing a Strong Asia-Pacific Presence
Developing a Strong Asia-Pacific Presence Strengthens Canaccord’s Asia-Pacific strategy EXPANDED ASIA-PACIFIC FOOTPRINT Australia & Hong Kong Canaccord BGF • Investment banking and Advisory services in Singapore will Singapore Canaccord Genuity (Singapore) complement Canaccord’s existing operations
Slide 15: Strategic Rationale
STRATEGIC RATIONALE CANACCORD.
Slide 16: Strategic Rationale
Strategic Rationale • Positions the business as a leading independent investment bank in the UK Creates A Leading Independent • Adds scale and diversifies revenue stream Investment Bank in the UK – UK and Europe Pro-forma C$347.1 million or £223.9 million LTM revenues¹ – Core franchise strengths hig
Slide 17: Shared Strengths, Complementary Differences
Shared Strengths, Complementary Differences CANACCORD COLLINS STEWART COMBINED ADVANTAGE GENUITY (UK) HAWKPOINT Independent Perspective ✓ ✓ Credible advice free of conflicts experienced with banks Client-focused Culture ✓ ✓ Shared values and commitment to client service excellence Resource Sector St
Slide 18: Building a Stronger Business for our Clients
Building a Stronger Business for our Clients CANACCORD COLLINS STEWART COMBINED ADVANTAGE GENUITY (UK) HAWKPOINT ✓ UK Small to Mid- Cap Trading After the business combination, Canaccord Genuity’s expanded trading Leadership capabilities will make it a leading independent trader of both small and lar
Slide 19: Financial Rationale
FINANCIAL RATIONALE CANACCORD.
Slide 20: Financial Terms of Offer
Financial Terms of Offer Proposed offer to Collins Stewart shareholders 40% stock/60% cash consideration at £0.96 per share [NB. Plus proposed dividend] • 25.3% premium to 2-year trading average¹ • 5.7% premium to 52-week high¹ • Additionally, Collins Stewart shareholders will receive a dividend of
Slide 21: Financial Rationale for Canaccord
Financial Rationale for Canaccord Accretive to Earnings and Attractive Fundamental Valuation • Modestly accretive without synergies and cost savings • Further accretive with synergies¹ • US and UK cost savings and revenue enhancement opportunities from operational synergies KEY DRIVERS OF EARNINGS A
Slide 22: Collins Stewart Hawkpoint plc
COLLINS STEWART HAWKPOINT PLC
Slide 23: Collins Stewart Hawkpoint: Overview
Collins Stewart Hawkpoint: Overview A UK-based independent investment bank with HALF YEAR REVENUE BY BUSINESS DIVISION C$ millions. Converted into C$ on the end of each period. global operations Securities Corporate Broking Wealth Management Hawkpoint • Provides a full spectrum of investment banking
Slide 24: Collins Stewart Wealth Management
Collins Stewart Wealth Management Strong UK & European Wealth Management Business GROWTH IN AUM (HALF YEAR PERIODS) C$ billions. Converted into C$ on the end of each period. • 110 client-facing investment management professionals $16.0 • Wealth management offices in London, the Channel Islands, $13.
Slide 25: Collins Stewart Hawkpoint Capital Markets Capabilities
Collins Stewart Hawkpoint Capital Markets Capabilities Advisory, Corporate Broking, and Securities services ADVISORY REVENUE (HAWKPOINT, HALF YEAR PERIODS) C$ millions. Converted into C$ on the end of each period. • Capital markets operations in four geographies 45 $37.9 • Advisory offices in Paris,
Slide 26: Canaccord Financial
CANACCORD FINANCIAL CANACCORD.
Slide 27: Canaccord Financial: A growth-focused global investment bank
Canaccord Financial: A growth-focused global investment bank Publicly listed on the TSX (CF) and AIM (CF.) Key Metrics (C$) Fiscal F Q1/12 F Q2/12 Excluding acquisition-related • 30% owned by directors and senior officers (1) items³ 2011 • Over 50% owned by employees Gross Revenue (millions) $803.6
Slide 28: Wide-ranging Investment Banking Capabilities
Wide-ranging Investment Banking Capabilities Two main operating divisions cater to a wide range of client needs: Global Sales and Trading High-quality, Independent Investment Banking Investment Advice and Brokerage Platform Research (Corporate Finance/M&A and services for individual Canadian Advisor
Slide 29: Growth Strategy
Growth Strategy Our goal is to be the pre-eminent global investment dealer CANACCORD’S SUCCESSFUL GROWTH STORY: focused on growth companies December 2011 • Global platform, local focus Announced proposed acquisition of Collins Stewart UK, US, Europe, Asia Successfully acquired and integrated five co
Slide 30: Establishing a Strong Presence in the Asia-Pacific Region
Establishing a Strong Presence in the Asia-Pacific Region Canaccord BGF STRATEGIC AGREEMENT • On November 2, 2011 Canaccord completed its purchase of a 50% The Export-Import Bank of China equity interest in BGF Equities • Rebranded operations in Australia and Hong Kong as Canaccord BGF • Mutually be
Slide 31: Solid Capital Position
Solid Capital Position Well capitalized for growth opportunities and increased business activity • Dividend of C$0.10 the last three quarters – Reviewed and approved by board each quarter • Strong, liquid balance sheet • Raised C$113.5 million of aggregate gross proceeds through a recent preferred s
Slide 32: Fiscal 2011 Financial Performance
Fiscal 2011 Financial Performance $1,000 $130 $114 $804 $757 $732 $110 $93 $800 Net Income $90 $79 $578 Revenue $600 $478 $70 $50 $42 (C$ millions) $400 (C$ millions) $30 $200 $10 ($1) $0 -$10 2007 2008 2009 2010 2011 2007 2008* 2009* 2010* 2011* 40.0% $2.50 28.4% $1.94 30.0% Diluted EPS $2.00 $1.63
Slide 33: Building a Dominant Global Dealer
Building a Dominant Global Dealer Canaccord Genuity will operate in twelve countries and have the capabilities to list companies on ten stock exchanges. Wealth Management operations in four geographies will provide a steady source of revenue to complement Canaccord Genuity’s ability to leverage the
Slide 34: Appendices
APPENDICES Canaccord Fiscal 2011 performance – in Pounds Sterling Canaccord Fiscal Q2/12 performance Overview of Canaccord business lines and employee distribution Canaccord’s seven values Executive Biographies
Slide 35: Fiscal 2011 Financial Performance in Pounds Sterling
Fiscal 2011 Financial Performance in Pounds Sterling £600 £80 £73 £516 Net Income £359 £376 £60 £400 £335 Revenue £41 £39 £265 £40 £27 (£ millions) £200 (£ millions) £20 -£1 £0 £0 2007 2008 2009 2010 2011 -£20 2007 2008* 2009* 2010* 2011* 40.0% 100 90p 28.4% 86p 30.0% 80p Diluted EPS 80 20.0% 14.2%
Slide 36: Q2/12 Financial Performance
Q2/12 Financial Performance $50 $46 $300 $42 $255 $248 Net Income $250 $40 Revenue $200 $30 $160 $149 (C$ millions) $20 (C$ millions) $150 $120 $12 $14 $100 $10 $(1.7) $50 $0 Q2/11 Q3/11 Q4/11 Q1/12 Q2/12 Q2/11* Q3/11* Q4/11* Q1/12* Q2/12* -$10 $0.60 $0.55 $0.50 30% 25.0% $0.50 22.6% 25% Diluted EPS
Slide 37: Globally Integrated Business Lines
Globally Integrated Business Lines CANADA UNITED KINGDOM UNITED STATES CHINA AUSTRALIA Full-service investment bank, providing services to institutional and corporate clients. Approx. 770 employees world-wide. 400 employees 153 employees 186 employees 35 employees in Canada in the UK in the US in Ch
Slide 38: Seven Values Drive our Business
Seven Values Drive our Business Seven key values drive Canaccord employees and management in delivering results to our shareholders, clients and community. They support our unwavering commitment to building lasting client relationships, creating shareholder value and generating innovative ideas. 1.
Slide 39: Executive Biographies
Executive Biographies Paul Reynolds Brad Kotush Mark Brown President & CEO of Canaccord Chief Financial Officer of Canaccord Chief Executive of Collins Stewart Financial Inc. Financial Inc. Hawkpoint plc To be appointed CEO of Canaccord Genuity Ltd. following the transaction Paul Reynolds was named
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