CIBC Snaps Up Geneva Advisors

(RTTNews) - Canadian Imperial Bank of Commerce (CM.TO, CM), Canada's fifth biggest lender, said it has agreed to acquire Chicago-based private wealth management firm Geneva Advisors for $200 million. The acquisition marks another step by CIBC to bolster its presence in the U.S.

Geneva Advisors is an independent private wealth management firm focused on high net worth clients. It has $8.4 billion in assets under management and about 100 employees.

The transaction follows the completion of CIBC's $4.9 billion acquisition of Chicago-based PrivateBancorp Inc. (PVTB) in June.

The acquisition of Geneva Advisors will enable CIBC to expand its private wealth management client-base and investment management capabilities in the U.S.

Under the terms of the deal, $135 million of the purchase price will be paid by CIBC at closing, while the remaining $65 million is contingent on future performance conditions being met.

The total purchase price, including contingent consideration, will be paid 25 percent in cash and 75 percent in the form of CIBC common shares.

The transaction is expected to close in the fourth quarter of fiscal 2017. On closing, the Geneva Advisors business will become part of CIBC Atlantic Trust Private Wealth Management.

The deal is expected to reduce CIBC's Common Equity Tier 1 Capital Ratio by about 6 basis points at closing and also become accretive to its earnings per share in fiscal 2019.

Upon completion of the transaction, CIBC will have about $50 billion in assets under administration in the U.S. on a pro forma basis.

On the Toronto Stock Exchange, CM.TO closed Monday's trading at C$106.10, up C$0.04 or 0.04 percent on a volume of 692,017 shares.