Blakes advises RBC in $13.5 billion HSBC takeover deal expected to close in March

Blakes is serving as legal counsel to RBC in its $13.5 billion acquisition of HSBC Canada. The deal is expected to close in March 2024. Also in this week’s deals roundup are Stikeman Elliot and Goodmans.

RBC targets March for completion of $13.5 billion HSBC takeover deal

Royal Bank of Canada (RBC) announced that the target completion of its $13.5-billion takeover of HSBC Holdings PLC’s Canadian subsidiary is set for March 28, 2024. Once completed, this transaction is expected to be the biggest domestic banking deal on record.

Blake, Cassels & Graydon, Allen & Overy, and Wachtell, Lipton, Rosen & Katz are serving as Canadian, UK, and US legal counsel, respectively, to RBC. RBC Capital Markets is acting as the lead and primary financial advisor.

Linklaters LLP is serving as legal counsel to HSBC, while HSBC Global Banking and JPMorgan Cazenove are acting as financial advisors.

The deal was announced in November 2022 and was originally expected to close in late 2023 but the deal encountered delays as it moved through regulatory approvals.

Canadian Minister of Finance Chrystia Freeland approved the deal in mid-December.

AGF to acquire majority interest in Kensington Capital for $45 million

AGF Private Capital Inc., AGF Management Limited’s (AGF) private markets business, has agreed to acquire a 51 percent interest in Kensington Capital Partners Limited, a Toronto-based private equity fund manager, in a deal valued at $45 million.

Stikeman Elliot LLP is serving as legal counsel and National Bank Financial Inc. is acting as financial advisor to AGF. Goodmans LLP is acting as legal counsel to Kensington.

Under the agreement, Kensington will retain its investment and operational independence as part of AGF.

Kensington’s three Senior Managing Directors, Tom Kennedy, Richard Nathan and Eamonn McConnell, will continue to manage the business in their leadership roles, working closely with Ash Lawrence, Head of AGF Private Capital, and the Kensington Board of Directors.

“Kensington is a well-positioned private equity investment firm with an established brand and proven track record of performance,” said Head of AGF Private Capital Ash Lawrence. “They have strong relationships that fit well within AGF's target channels and have built a growth-oriented business that mirrors AGF’s goal of accelerating the growth of our private markets business.”

“AGF Private Capital’s strategy is the ideal catalyst for Kensington's further growth as we look to open doors to new strategies, relationships and regions,” said Kensington Chairman and Senior Managing Director Tom Kennedy. “AGF‘s size, scale, reputation and capital to invest in our growth lends the credibility and backing we need as we look to expand our investments, including the launch of additional innovative investment products.”

The deal is expected to close in the second quarter of 2024, subject to certain regulatory approvals and closing conditions.

Capital Power, Ontario Power Generation partner to build Alberta’s first nuclear power reactor

Capital Power Corporation, an Alberta-based producer of electricity generated from natural gas, wind, and solar, has signed an agreement with Ontario Power Generation (OPG) in which the two companies will jointly assess the development and deployment of building small modular reactors (SMRs) in the Western province.

The feasibility assessment is expected to be completed within two years.

“We are at the forefront of electrification which will drive continual growth in demand for power,” said Capital Power CEO Avik Dey. “The deployment of SMR technology will provide an important source of safe, reliable, flexible, affordable, and clean baseload electricity in Alberta in the future.”

“With decades of experience building, operating and maintaining clean, safe nuclear power generation, OPG is pleased to work with Capital Power as they explore adding nuclear to Alberta’s electricity supply mix,” said OPG President and CEO Ken Hartwick. “Through collaborations like this, we will share expertise related to SMR development and deployment, to build energy security and economic growth in both provinces.”

“Small Modular Reactors have the potential to play a major role in the province’s search for the right energy mix to supply clean, reliable and affordable electricity to Albertans,” said Alberta Minister of Affordability and Utilities Hon. Nathan Neudorf. “This partnership represents an exciting and important step forward in our efforts to decarbonize the grid while maintaining on-demand baseload power.”

Alberta Minister of Environment and Protected Areas Hon. Rebecca Schulz said, “SMRs are small but powerful, with the potential to help reduce emissions across the economy. This is an exciting step forward and could help us keep energy reliable and affordable for years to come.”

OPG has begun preparations to build North America’s first fleet of SMRs at its Darlington New Nuclear site in Ontario, with the construction of the first of four SMRs expected to be completed by the end of 2028.