Home Capital Obtains Final Court Approval for Arrangement to Be Acquired by Smith Financial Corporation

Home Capital Group Inc. (“Home Capital”) (TSX: HCG) today announced that it has obtained a final order from the Ontario Superior Court of Justice (Commercial List) approving the previously-announced plan of arrangement under the Business Corporations Act (Ontario) (the “Arrangement”). Under the Arrangement, a wholly owned subsidiary (the “Purchaser”) of Smith Financial Corporation (“SFC”), a company controlled by Stephen Smith, has agreed to acquire the issued and outstanding common shares of Home Capital that SFC does not already own for $44.00 in cash per share (the “Purchase Price”), subject to increase in certain circumstances described below.

Receipt of the final order follows Home Capital’s special meeting of shareholders held on February 8, 2023, where a special resolution approving the Arrangement was overwhelmingly approved by 99.79% of the votes cast by shareholders.

Completion of the Arrangement remains subject to the satisfaction or waiver of certain closing conditions that are set out in the arrangement agreement entered into among Home Capital, SFC and the Purchaser on November 20, 2022 (the “Arrangement Agreement”). These conditions include regulatory approvals under the Bank Act (Canada), the Trust and Loan Companies Act (Canada) and the Competition Act (Canada). Subject to obtaining all required regulatory approvals and the satisfaction or waiver of the remaining conditions in the Arrangement Agreement, the Arrangement is anticipated to be completed in mid-2023. If the Arrangement closes on or after May 20, 2023, the Purchase Price will be increased by an amount equal to $0.00273973 per share in cash per day up to and including the day prior to the closing of the Arrangement (equivalent to approximately $0.25 per share for every three-month delay beyond May 20, 2023).

Caution Regarding Forward Looking Statements

This press release contains forward-looking information within the meaning of applicable Canadian securities legislation, including relating to whether, and when, the Arrangement will be consummated and the anticipated receipt of required regulatory approvals, including the timing thereof. Such forward-looking information necessarily involves known and unknown risks and uncertainties and assumptions. These risks, uncertainties and assumptions include, but are not limited to failure to, in a timely manner, or at all, obtain the required regulatory approvals for the Arrangement and other customary risks associated with transactions of this nature. Therefore, forward-looking information should be considered carefully and undue reliance should not be placed on such information. Please note that forward-looking information in this news release reflects management’s expectations as of the date hereof, and therefore is subject to change. Home Capital disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law. Please refer to Home Capital’s 2022 Third Quarter Report, available on Home Capital’s website at www.homecapital.com, and on SEDAR at www.sedar.com, for Home Capital’s Caution Regarding Forward-looking Statements.

About Home Capital

Home Capital is a public company, traded on the Toronto Stock Exchange (HCG), operating through its principal subsidiary, Home Trust Company. Home Trust Company is a federally regulated trust company offering residential and non-residential mortgage lending, securitization of residential mortgage products, consumer lending and credit card services. In addition, Home Trust Company and its wholly owned subsidiary, Home Bank, offer deposits via brokers and financial planners, and through a direct-to-consumer brand, Oaken Financial. Licensed to conduct business across Canada, we have offices in Ontario, Alberta, British Columbia, Nova Scotia, and Quebec. 

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FOR ADDITIONAL INFORMATION:
Home Capital Group Inc.
Jill MacRae
VP, Investor Relations and ESG
416-933-4991
[email protected]