Bank of Montreal agrees to buy F&C for £708m
BANK of Montreal has agreed to buy the manager of the oldest UK investment fund for £708m (€859m) – the second largest takeover in its history.
Canada's fourth-biggest lender by assets will pay 120 pence a share in cash for F&C Asset Management. F&C shareholders will also receive their 2p dividend for last year.
F&C "is intended to form the centrepiece of BMO Global Asset Management's European operations", the companies said.
Bank of Montreal, like other Canadian lenders, is expanding its money-management arm abroad amid a slowdown in domestic consumer lending.
It's acquiring a London-based firm whose assets shrank last year as institutional clients pulled funds.
"With an established pedigree in fixed-income investment and broad equity and property capabilities", F&C will "add scope and scale to our well-established portfolio of wealth-management businesses", Bank of Montreal chief executive William Downe said.
F&C shares rose 4pc to 121 pence at 9am in London yesterday. They surged 25pc on Monday, when F&C said it was in talks with the bank and was likely to recommend a bid.
David McCann, an analyst at Numis Securities in London, said that Bank of Montreal's offer may flush out other bidders.