EQB Inc., the parent company of Equitable Bank, is set to acquire PC Financial from Loblaw Companies Ltd. This significant deal is valued at approximately $800 million and involves the acquisition of several entities, including President’s Choice Bank, the PC Financial Insurance Agency, and PC Financial Insurance Brokers.
Details of the Acquisition
The acquisition will see EQB become the exclusive financial partner of the PC Optimum loyalty program, which is associated with Loblaw. This partnership aims to provide enhanced financial services to PC Optimum members.
Financial Aspects
This deal is structured to purchase PC Financial at 1.15 times its book value at the time of closing. It excludes any excess capital beyond a 13 percent common equity tier 1 (CET1) ratio. The CET1 ratio is an essential indicator of a bank’s financial stability, reflecting its ability to absorb losses.
Expected Closing
The transaction is anticipated to be finalized next year, marking a pivotal moment for both EQB and Loblaw as they reshape their financial services landscape.
Summary
- Acquirer: EQB Inc. (Equitable Bank)
- Acquired: PC Financial, President’s Choice Bank, and affiliated entities
- Deal Value: $800 million
- Valuation Metric: 1.15 times book value at closing
- Capital Exclusions: Above 13% common equity tier 1 (CET1) ratio
- Expected Closing: Next year
