TLDR: AGF Private Capital acquires majority stake in Kensington Capital Partners for $45 million
Toronto-based firms AGF Private Capital and Kensington Capital Partners have signed a definitive agreement for AGF to acquire a majority stake in Kensington for $45 million. Following the transaction, Kensington will retain its investment and operational independence and its three senior managing directors will continue to manage the business. The deal is expected to close in the second quarter of 2024.
Key Points:
- AGF Private Capital acquires a majority interest in Kensington Capital Partners for $45 million
- Kensington retains its investment and operational independence
- Deal expected to close in Q2 2024
Toronto-based firms AGF Private Capital and Kensington Capital Partners have entered into a definitive agreement that will see AGF acquire a majority interest in Kensington for $45 million. The deal is expected to close in the second quarter of 2024.
Kensington, an employee-owned firm, will give up a 51% stake in its business, while retaining 49% ownership and its investment and operational independence. The three senior managing directors of Kensington will continue to manage the business in their leadership roles.
The chairman and senior managing director of Kensington, Tom Kennedy, believes that the deal will provide new opportunities for the asset manager, including access to new strategies, relationships, and regions. He expects the investment from AGF, with its size, scale, reputation, and capital, to enable Kensington to expand its investments and launch innovative products.
Kensington has played a significant role in the Canadian tech ecosystem, managing a substantial amount of capital. It was selected as one of the four funds-of-funds managers for the Canadian government’s Venture Capital Catalyst Initiative (VCCI) and successfully closed its third venture fund in April 2023. The fund allocated 70% of its capital to Canadian VC funds and reserved the remaining 30% for direct investments in tech startups.
In addition, Kensington was chosen to manage the Government of British Columbia’s BC Tech Fund in 2016, which invested $100 million in BC-based information and communications technology, digital media, cleantech, and life science startups.
Following AGF’s investment, Kensington’s assets under management will increase to $2.6 billion. AGF, with $42.8 billion in assets under management, will provide Kensington with its distribution reach and operating infrastructure.
This acquisition by AGF comes at a time when the private equity industry experienced a slower year in terms of capital raised. According to McCarthy Tetrault’s 2024 private equity report, global private capital raised between September 30, 2022, to 2023 was $1.16 trillion USD, a 14% decrease compared to the previous year.
