AGF Private Capital Acquires Majority Stake in Kensington for $45M
AGF Private Capital, a Toronto-based firm, has signed a definitive agreement to acquire a majority interest in Kensington Capital Partners for $45 million. The transaction is expected to close in the second quarter of 2024.
Kensington to Retain Independence Following AGF Acquisition
Kensington Capital Partners, an employee-owned firm, will give up a 51-percent stake to AGF Private Capital while retaining a 49-percent stake. Additionally, Kensington will maintain its “investment and operational independence.” This move allows Kensington to benefit from AGF’s size, scale, reputation, and capital for future growth while still maintaining control over its operations.
Kensington Chairman Looks to Expand Investments with AGF Backing
Tom Kennedy, the chairman and senior managing director of Kensington, believes that the acquisition will open doors to new strategies, relationships, and regions for the asset manager. Kennedy stated that AGF’s credibility and backing are crucial as Kensington looks to expand its investments, including the launch of additional innovative investment products. The deal will provide Kensington with the necessary resources and support to fuel its growth ambitions.
Kensington’s Role in Canadian Tech Ecosystem and VCCI Initiative
Kensington Capital Partners has been a key player in the Canadian tech ecosystem. The firm was selected as one of four funds-of-funds managers for the Government of Canada’s Venture Capital Catalyst Initiative (VCCI). Kensington completed a first close of its third venture fund in April 2023, which had a significant capital allocation for fund-of-funds targets. It also managed the Government of British Columbia’s BC Tech Fund, investing $100 million in BC-based startups. Kensington’s expertise and track record in the tech sector have positioned it as a reputable player in the Canadian venture capital landscape.
AGF’s Investment in Kensington Strengthens Private Equity Strategy
AGF Private Capital’s investment in Kensington strengthens its private equity strategy. AGF, with $42.8 billion in assets under management, provides distribution reach and operating infrastructure that will benefit Kensington. AGF serves over 800,000 investors and has investment operations and client servicing teams in North America and Europe. The addition of Kensington’s private equity expertise complements AGF’s existing private credit strategy and alternative assets capabilities. As AGF aims to accelerate the growth of its private markets business, Kensington’s established brand and proven track record of performance make it an attractive partner.
The acquisition of a majority stake in Kensington by AGF Private Capital reflects the ongoing activity in the private equity space. Despite a slower year for private equity globally, this deal demonstrates the continued interest in strategic investments and partnerships within the industry. Kensington’s position in the Canadian tech ecosystem, combined with AGF’s resources and expertise, sets the stage for further growth and innovation in the private equity market.
Analyst comment
Positive news. The acquisition of a majority stake in Kensington by AGF Private Capital provides opportunities for growth and expansion for both firms. Kensington will retain independence while benefiting from AGF’s size and reputation. AGF’s investment strengthens its private equity strategy and expands its capabilities. This deal reflects ongoing interest in strategic partnerships in the private equity industry and sets the stage for further growth and innovation. Market is expected to see positive outcomes and increased activity in the private equity market.
