Scotiabank (BNS.TO, BNS) on Friday said it plans to buy out the minority shareholders of Scotia Group Jamaica Limited (SGJL) for $500 million.
The proposed deal is part of the company's strategy to "optimize capital and operational efficiency across its existing footprint," it said. SGJL, based on the unanimous recommendation of a committee of independent directors of the board of directors of SGJL, entered into a definitive arrangement agreement with its majority shareholder, Scotiabank Caribbean Holding Limited (SCHL), whereby all of the issued and outstanding shares of SGJL that SCHL does not currently own will be bought back, subject to approval of SGJL's minority shareholders.
The total cash consideration being offered to minority shareholders is about C$0.5 billion and the CET1 ratio impact at closing is estimated to be about 5-basis points. The proposed transaction will be undertaken by way of a court-approved Scheme of Arrangement under the Companies Act 2004 in Jamaica, it said.
If the proposed deal is approved at the meeting, to be held by SGJL in the coming months, by the minority shareholders, it is expected to close by year end, subject to certain conditions, it said. The SGJL shares are expected to be de-listed from the Jamaica Stock Exchange, following completion of the proposed deal.
Shares of the company were last seen up $1.66 to $116.93 on the Toronto Stock Exchange.
Price: $116.94, Change: $+1.67, Percent Change: +1.45%