“Expanding into Canada is part of Natixis’ strategic plan to actively pursue international growth,” the firm said. In June, for example, it unveiled a business development initiative focused on the growing Canadian institutional market, having also last year established a retail platform in the UK, adding staff and launching mutual funds.

With its latest move, Natixis said it will build on NexGen’s existing mutual fund platform by offering select asset management strategies to the Canadian retail market. NexGen currently distributes through some 1,600 financial advisors and 100 dealers in Canada.

For NextGen, the deal paves the way for greater access to investment strategies that “will allow us to create new products,” said Abe Goenka, NexGen co-chief executive.

“NexGen is an innovative firm with a strong management team and a solid lineup of retail mutual funds offered through an expansive distribution platform,” said John Hailer, chief executive of Natixis in the Americas and Asia.

Terms

NexGen had over C$919 million in assets under management at end-September 2014 and a “broad distribution platform.” Natixis, meanwhile, managed over $930 billion in assets at end-June 2014 through its global affiliates.

Natixis will buy all outstanding common shares of NexGen for C$7.25 in cash per common share – a 107 per cent premium to NexGen's closing share price of C$3.50 on October 23.

NexGen will operate autonomously with the existing senior management team.

“There are no immediate plans to make staffing changes or changes to the NexGen business model,” Natixis said.

Completion of the transaction is subject to customary closing conditions, including Ontario court approvals, a favorable vote of at least two-thirds of the votes cast by NexGen shareholders and applicable regulatory approvals.

Shareholders who collectively own over 50 per cent of NexGen’s issued and outstanding common shares have entered into agreements with Natixis pursuant to which they have agreed, among other things, that they will vote all of their NexGen common shares in favor of the transaction, unless the arrangement agreement is terminated in certain circumstances.

The deal is expected to close in January 2015.