DEFINITY AND MCDOUGALL COMPLETE DRAYDEN ACQUISITION
WATERLOO, ON, Oct. 3, 2023
WATERLOO, ON, Oct. 3, 2023 /CNW/ - McDougall Insurance Brokers Limited ("McDougall"), a subsidiary of Definity Financial Corporation (TSX: DFY), has completed its previously-announced acquisition of Drayden Insurance Ltd. ("Drayden").
The purchase was effected by way of funding from Definity, using excess capital, and the issuance to selling shareholders of shares of McDougall. After accounting for all related transactions, Definity's ownership interest in McDougall is approximately 78%. Drayden will maintain its brand and be managed as an operating unit of McDougall.
Over the past 12 months, Definity has built an insurance broker platform approaching one billion dollars in annual premiums through the acquisition of its majority interest in McDougall, and McDougall's subsequent acquisitions of McFarlan Rowlands Insurance Brokers Inc. and Drayden. The Drayden acquisition is expected to be immediately accretive to Definity's operating return on equity1 and operating earnings per share1. Definity continues to hold significant financial capacity for future opportunities.
Definity Financial Corporation ("Definity", which includes its subsidiaries where the context so requires) is one of the leading property and casualty insurers in Canada, with over $3.8 billion in gross written premiums for the 12 months ended June 30, 2023 and approximately $2.7 billion in equity attributable to common shareholders as at June 30, 2023.
This news release may contain forward-looking information within the meaning of applicable securities laws, which reflects Definity's current expectations regarding future events, including statements relating to the acquisition of Drayden ("Acquisition"), the accretive impact of the Acquisition on operating return on equity and operating earnings per share, the financial capacity held by Definity, the annual premiums of Definity's insurance broker platform, Definity's level of ownership in McDougall, and the operations of Drayden, among others. The words "will", "expected", or the negative or other variations of these words or other similar or comparable words or phrases are intended to identify forward-looking statements. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Definity's control. Such risks and uncertainties are included in the "Cautionary Note Regarding Forward-looking Information" section of Definity's Q2-2023 Management's Discussion and Analysis dated August 3, 2023 and the "Risk Management and Corporate Governance" section of Definity's Management's Discussion and Analysis for the year ended December 31, 2022, each of which is available on our web site at www.definityfinancial.com and on SEDAR+ at www.sedarplus.ca. Actual results could differ materially from those projected herein. Unless otherwise indicated, all forward-looking statements in this press release are made as of October 3, 2023 and are subject to change after that date. Definity does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required under applicable securities laws.
Supplementary Financial Measures and Non-GAAP Financial Measures and Ratios
We measure and evaluate performance of our business using a number of financial measures. Among these measures are the "supplementary financial measures", "non-GAAP financial measures", and "non-GAAP ratios" (as such terms are defined under Canadian Securities Administrators' National Instrument 52-112 – Non-GAAP and Other Financial Measures Disclosure), and in each case are not standardized financial measures under GAAP. The supplementary financial measures, non-GAAP financial measures, and non-GAAP ratios in this news release may not be comparable to similar measures presented by other companies. These measures should not be considered in isolation or as a substitute for analysis of our financial information reported under GAAP. These measures are used by financial analysts and others in the P&C insurance industry and facilitate management's comparisons to our historical operating results in assessing our results and strategic and operational decision-making. For more information about these supplementary financial measures, non-GAAP financial measures, and non-GAAP ratios, including (where applicable) definitions and explanations of how these measures provide useful information, refer to Section 12 – Supplementary financial measures and non-GAAP financial measures and ratios in the Q2-2023 Management's Discussion and Analysis dated August 3, 2023, which is available on our website at www.definityfinancial.com and on SEDAR+ at www.sedarplus.ca. These measures have been updated to reflect the estimated impact arising from the adoption of IFRS 17 and IFRS 9.
1This is a supplementary financial measure, non-GAAP financial measure, or a non-GAAP ratio. Please refer to Supplementary financial measures and non-GAAP financial measures and ratios in this news release, and Section 12 – Supplementary Financial Measures and Non-GAAP Financial Measures and Ratios in Definity's Management's Discussion and Analysis for the quarter ended June 30, 2023 for further details, which is available on the Company's website at www.definityfinancial.com and on SEDAR+ at www.sedarplus.ca.
SOURCE Definity Financial Corporation