- People Corporation (PEO) has signed a deal under which it will be bought out by funds managed by the Goldman Sachs Merchant Banking Division
- Goldman Sachs will acquire all of People’s issued and outstanding common shares at a price of C$15.22 each for a total equity value of roughly $1.13 billion
- The purchase price represents a 36 per cent premium compared to People’s closing share price on December 11, and a 28 per cent premium compared to its all-time highest share price
- The company said the buyout will facilitate its next chapter of growth and expands its capacity to deliver its services to clients
- People Corporation is currently up 35.75 per cent to $15.15 per share
People Corporation (PEO) has signed a deal under which it will be bought out by funds managed by the Goldman Sachs Merchant Banking Division.
Under the terms of the agreement, the New York-based division – the primary centre for the Goldman Sachs Group’s long-term principal investing activity – will acquire all of People’s issued and outstanding common shares at a price of C$15.22 each, valuing the company at roughly $1.13 billion.
Such a price represents a 36 per cent premium compared to the company’s closing share price on December 11, and a 28 per cent premium compared to its all-time highest closing share price.
“This transaction delivers tremendous value for our shareholders while creating the conditions that will enable our team to write People Corporation’s next chapter,” said Laurie Goldberg, Executive Chairman and CEO of People Corporation.
“As a private company with a committed, well-capitalised and long-term owner, People Corporation will accelerate its scale in talent and technology, consistent with its commitment to bring to bear industry-leading group benefits, group retirement and HR solutions to each client engagement, delivered by its best-in-class consultants across its national platform,” he added.
Laurie, along with People’s existing senior management team, will continue to lead the company out of its head office in Winnipeg, Manitoba. It’s expected that no changes will be made to the company’s current personnel and service model.
The deal is the result of an extensive review of strategic alternatives for People, and was lead by a special committee of independent directors that assessed a variety of potential strategic buyers and financial sponsors.
People will now seek shareholder approval for the transaction at a special meeting in February next year. While the agreement also remains subject to approval by the Ontario Superior Court of Justice, it is expected to close in the first quarter of 2021.
“The company has a compelling client offering with experienced consultants and a national scale that have helped deliver outstanding organic growth over time,” said Anthony Arnold, Managing Director of Goldman Sachs.
“There is also a continued and meaningful investment opportunity to deploy capital and access opportunities in People Corporation’s core and adjacent markets,” he continued.
People Corporation is currently up 35.75 per cent to $15.15 per share at 9:51am EST.