GMP Capital, a Toronto-based provider of financial advisory and investment services, has agreed to buy Calgary-based FirstEnergy Capital for $98.6m.
The acquisition will consist of nearly $58.9m in restricted GMP common shares with the remainder being paid by GMP through the issuance of an unsecured promissory note.
FirstEnergy, which was incorporated in 1993, manages over $63 bn in equity financing transactions in the energy sector and has advised on 159 transactions with an aggregate value of $31bn.
Following the acquisition, GMP will operate the combined energy businesses under the ‘GMP FirstEnergy’ brand.
The deal, which is subject to customary closing conditions including regulatory approval, is expected to be complete in the fall of 2016.
GMP CEO and president Harris Fricker said: “This significant investment reconfirms our commitment to Calgary and the oil and gas sector and is aligned with our longer-term bullish view of the energy market. We look forward to welcoming our new business partners and supporting them as they continue to build on their strengths and expertise in energy."
FirstEnergy CEO John Chambers said: "This strategic partnership with GMP, given its broader platform and greater access to efficient capital represents the best path forward for our valued clients and business partners, with the merger of two similar cultures.
"GMP's long-standing commitment to the energy sector and the Calgary community was important to us and our clients. We are committed to a seamless integration to ensure that the exceptional service and execution, to which our collective clients have become accustomed to, is not disrupted."
Additionally, FirstEnergy executive chairman Jim Davidson will join GMP Securities as deputy chairman and FirstEnergy CEO John Chambers will serve as vice chairman and president of GMP FirstEnergy.
Nicholas Johnson will be appointed as vice chairman and co-head energy investment banking and Trent Boehm will act as vice chairman and head of energy capital markets.