BMO Financial Group has announced a definitive agreement to acquire the capital markets business of Euroz Hartleys Group, a prominent Australian financial services firm. The transaction, valued at approximately A$80 million (about US$52 million), is expected to close in the second quarter of 2025, subject to regulatory approvals and customary closing conditions.
Details of the Acquisition
Under the terms of the agreement, BMO will acquire the capital markets operations of Euroz Hartleys, which include corporate advisory, equities research, sales and trading, and wealth management services. The acquisition will add approximately 100 employees to BMO's existing team in Australia, strengthening its presence in the region.
BMO has been active in Australia for over 20 years, primarily through its metals and mining investment banking business. This acquisition is part of BMO's strategy to expand its global capital markets footprint and deepen its capabilities in the Asia-Pacific region.
Strategic Rationale
"This acquisition is a natural next step in the growth of our Australian business," said Darryl White, CEO of BMO Financial Group. "Euroz Hartleys has a strong reputation and a talented team that will complement our existing operations and help us better serve our clients in the region."
The deal is expected to be accretive to BMO's earnings per share in the first full year after closing. BMO plans to integrate the acquired business into its existing BMO Capital Markets division.
Impact on Euroz Hartleys
For Euroz Hartleys, the sale of its capital markets business allows the firm to focus on its core wealth management and funds management operations. The company will retain its other business lines, including its funds management division, which manages over A$5 billion in assets.
"This transaction unlocks significant value for our shareholders and positions our capital markets business for continued success under BMO's ownership," said Michael Silverton, CEO of Euroz Hartleys Group. "We are confident that BMO is the right partner to take this business forward."
Regulatory Approvals and Timeline
The acquisition is subject to approval from the Australian Prudential Regulation Authority (APRA) and other relevant regulatory bodies. Both companies expect the transaction to be completed by mid-2025.
BMO has received committed financing for the transaction and expects to fund the purchase price from existing liquidity sources. The company maintains a strong capital position, with a Common Equity Tier 1 (CET1) ratio of 12.4% as of the most recent quarter.
