CIBC has agreed to acquire Chicago-based private wealth management firm Geneva Advisors.
This complementary acquisition will enhance CIBC's presence in the region, and builds on the bank's ability to deepen client relationships in the U.S. following the recent acquisition of The PrivateBank. On closing, the Geneva Advisors business will become part of CIBC Atlantic Trust Private Wealth Management.
Geneva Advisors is an independent private wealth management firm focused on high net worth clients. The firm has US$8.4 billion in assets under management and approximately 100 employees. The transaction follows the completion of CIBC's recent acquisition of The PrivateBank in June, and will expand the bank's private wealth management client-base and investment management capabilities in the U.S.
"Acquiring Geneva Advisors will further strengthen CIBC Atlantic Trust Private Wealth Management, led by our CEO of this business and industry veteran Jack Markwalter," said Larry Richman, Group Head, U.S. Region, and President & CEO The PrivateBank. "This investment will add scale in key markets where we can offer clients differentiated, high-touch service. We are pleased to have reached an agreement and look forward to welcoming Geneva Advisors' clients and strong team to our bank."
"Bringing together these two companies is a win for our clients," said John Huber, Principal & Portfolio Manager, Geneva Advisors. "From our founding in 2003 to today, our focus has been to offer objective and unbiased investment management decisions. We are proud of this philosophy and our tremendous team that has consistently grown Geneva Advisors and provided exceptional value to our clients."
"CIBC shares our client-focused culture and team-based approach," said Bob Bridges, Principal & Portfolio Manager, Geneva Advisors. "We have a common belief that by putting our clients' needs first, we are able to build trusted and long-lasting relationships. We look forward to becoming part of the CIBC team and enhancing the value we offer to our clients."
Under the terms of the agreement, CIBC will acquire Geneva Advisors for up to US$200 million, of which US$135 millionwill be paid at closing and US$65 million is contingent on future performance conditions being met. The total purchase price including contingent consideration will be paid 25% in cash and 75% in the form of CIBC common shares. The transaction is expected to close in the fourth quarter of fiscal 2017, subject to the satisfaction of customary closing conditions, including receipt of regulatory approvals.
The deal is expected to reduce CIBC's Common Equity Tier 1 Capital Ratio by approximately 6 basis points at closing and become accretive to CIBC's earnings per share in fiscal 2019. Upon completion of the transaction, CIBC will have approximately US$50 billion in assets under administration in the U.S. on a pro forma basis.