10:00 PM EDT, 07/27/2025 (MT Newswires) -- First National Financial Corporation ( FNLIF ) entered overnight Sunday into a definitive arrangement agreement with Regal Bidco Inc., a newly-formed acquisition vehicle controlled by private equity funds managed by Birch Hill Equity Partners Management Inc. and private equity funds managed by Brookfield Asset Management ( BAM ), whereby the two fund managers will acquire all of FN's outstanding common shares, other than rollover shares, for $48.00 per share in cash.

As part of the transaction, FN's founders, Stephen Smith and Moray Tawse, who currently hold approximately 37.4% and 34.0%, respectively, of the outstanding shares, will each sell approximately two-thirds of their current shareholdings in the company for the same cash consideration per share as other shareholders, and have agreed to exchange their remaining rollover shares for ownership interests in the purchaser. As a result, on closing of the transaction, Messrs. Smith and Tawse are each expected to maintain an indirect approximate 19% interest in First National, with Birch Hill and Brookfield holding the remaining approximate 62% interest.

A statement noted the transaction is not subject to any financing condition and is expected to close in the fourth quarter of 2025, subject to obtaining the required shareholder, court and regulatory approvals and the satisfaction of other customary closing conditions.

Sunday's statement said the purchase price represents a premium of approximately 15.2% and 22.8% to the 30 and 90-trading day volume weighted average trading price, respectively, of the shares on the TSX on July 25, 2025, the last trading day prior to the announcement of the transaction. The purchase price is also above the 52-week high closing price of the shares as of July 25, 2025 and represents a total shareholder return of approximately 2,149% on the company's initial public offering share price, including the company's historical dividend payments. The purchase price implies an aggregate total equity value of approximately $2.9 billion, inclusive of the rollover shares, and values the company at a 16.5x price-to-earnings multiple based on the company's reported trailing 1 months net income attributable to common shareholders as of March 31, 2025.

"This transaction represents the start of an exciting new chapter for First National," said Jason Ellis, CEO of First National. "Birch Hill and Brookfield bring significant expertise in the Canadian financial services industry, and we are excited to partner with them to grow our platform, drive innovation, and deliver for our customers, employees and institutional partners."