Sun Life Financial to Acquire Bentall Kennedy Group for $454M
TORONTO — Sun Life Financial Inc. (NYSE: SLF), a Toronto-based life insurer, has announced its acquisition of Bentall Kennedy Group for a purchase price of USD$454 million. Bentall Kennedy is a real estate investment manager operating in Canada and the U.S., with corporate offices in Toronto, Vancouver and Seattle.
The acquisition is part of Sun Life’s strategy to broaden its asset management pillar by expanding and diversifying the capabilities of Sun Life Investment Management, the company’s real estate investment management arm that services third parties and manages Sun Life’s general account.
The transaction is expected to close in the third quarter of 2015, subject to customary closing conditions, including regulatory approvals.
“The acquisition of Bentall Kennedy is a perfect fit with Sun Life’s four-pillar strategy,” says Dean Connor, CEO of Sun Life Financial. “It expands and diversifies our asset management pillar, with one of the most respected names in real estate.”
The two firms will combine their real estate investment management teams and Bentall Kennedy will be a unit of Sun Life Investment Management. Bentall Kennedy will retain its brand name and be Sun Life’s exclusive real estate investment management platform. Bentall Kennedy will also have the ability to offer Sun Life’s commercial mortgage investment business.
Together, the real estate and mortgage teams of Bentall Kennedy and Sun Life Investment Management will have USD$38.1 billion in assets under management, serving over 550 institutional clients and investors.
“The purchase of Bentall Kennedy complements Sun Life Investment Management’s expertise in asset-liability management, fixed income and alternative asset classes by extending our real estate and mortgage investment capabilities,” says Steve Peacher, president of Sun Life Investment Management and chief investment officer of Sun Life Financial.
Adds Peacher, “The two companies also share a common focus on customers, quality investments, strong governance and a commitment to sustainability. Together, we are well-positioned for future growth to meet the needs of pension funds and other institutional clients.”
Following completion of the transaction, Bentall Kennedy will continue to be managed by its current team, led by group CEO Gary Whitelaw, who will report to Steve Peacher and join the Sun Life Investment Management leadership team. Bentall Kennedy and Sun Life Investment Management will maintain their existing locations.
“My colleagues and I are excited to take this next step in our evolution,” says Whitelaw. “Sun Life is a strong, highly regarded, and extremely well run financial services organization. We share a deep commitment to investment management as a core business. This combination enables Bentall Kennedy to further advance its mission to stand apart for exceptional client service and high performance culture.”
Bentall Kennedy’s institutional shareholders, the British Columbia Investment Management Corp. (bcIMC) and the California Public Employees’ Retirement System (CalPERS), have both approved the transaction and will continue to be key clients of Bentall Kennedy under Sun Life’s ownership.
Bentall Kennedy includes Bentall Kennedy (Canada) LP and Bentall Kennedy (U.S.) LP. As of March 31, 2015, Bentall Kennedy had assets under management totaling USD$21.9 billion and provided real estate services across 91 million square feet of properties.
Sun Life Investment Management includes the investment operations of Sun Life Assurance Company of Canada, Sun Life Investment Management Inc. in Canada and Ryan Labs Asset Management Inc. in the United States. As of March 31, 2015, the Sun Life Financial group of companies had total assets under management of USD$659.2 billion. The company’s stock price closed Monday, June 15 at USD$34.19 per share, down from trading at USD$35.82 per share one year ago.
— John Nelson