GMP Capital has reiterated its support for a proposed transaction involving Richardson GMP Limited that it says will best position GMP to capitalize on the opportunities in the wealth management industry and offers the greatest potential for long-term value creation for its shareholders.
GMP believes the transaction, which has been approved by its board of directors and was recommended by a special committee of independent directors, is in the best interests of the company and all shareholders. RBC Capital Markets has also provided an opinion to GMP's board that the transaction is fair, from a financial point of view, to the company.
GMP Capital Inc. announced last month that it had entered into a definitive purchase agreement with Richardson Financial Group Limited to consolidate 100 per cent ownership of Richardson GMP.
Vote on proposal being held in October
In a management information circular to be filed next week, GMP intends to provide a complete analysis of the benefits of the transaction as well as the risks should the transaction not proceed, the company said in a statement. A vote on the transaction is scheduled for an annual and special meeting on October 6, 2020.
Anson Funds, which manages investment funds that hold about 8.5 per cent of the minority shares of GMP Capital, has stated its intention to vote against the transaction.
GMP believes the transaction should be approved based on its merits. However, Anson believes that the current proposal is highly dilutive to minority shareholders and results in de facto control of GMP being transferred to the Richardson Family at significantly less than fair value and without paying a control premium. Based on feedback from other significant minority shareholders, Anson believes that the proposal will not receive the requisite minority shareholder approval and Anson intends to vote against it.
