WINNIPEG, MANITOBA--(Marketwired - April 12, 2017) - People Corporation (TSX VENTURE:PEO) (the "Company") announced today the acquisition of Sirius Benefit Plans Inc. ("Sirius Benefits"), an industry-leading and nationally-focused Third Party Administrator (TPA) and Third Party Payor (TPP) for employee benefit plans of small and medium-sized companies that are located across Canada (the "Transaction"). Established in 1996, Sirius Benefits is based in Winnipeg, Manitoba.
Highlights of the Transaction include:
- Significantly enhances the Company's product and service offering in the small group segment of the group benefits market, creating a platform for future growth in this sizable market segment.
- The addition of Sirius Benefits' 250+ broker-partners materially expands People Corporation's distribution network, and these brokers will now have access to additional products and services to provide to their clients through access to People Corporation's portfolio of products and solutions.
- Opportunity to leverage investments in technology and administrative resources for the TPA business over a larger client base, and materially expands the Company's presence in Winnipeg, allowing for greater local scale in operations.
- Transaction expected to be immediately accretive to earnings and cash flow.
Laurie Goldberg, Chairman and CEO of People Corporation, commented, "We are thrilled to announce the acquisition of Sirius Benefits, our largest transaction to date in Winnipeg, where we are headquartered." Mr. Goldberg continued, "The opportunity to add a 'home-grown' Winnipeg-based firm to the People Corporation family, with the stature in the small group market and reputation with brokers and clients that Sirius Benefits has, is very exciting for us. The addition of Sirius Benefits is strategically significant to our TPA business, as it rounds out our TPA offering with a well-established and industry-leading small group product. Through our customized service offerings and integrated technology platforms, we can now bring best-in-class solutions and support to clients of all sizes, ranging from those with less than five employees to those with thousands of employees."
Sirius Benefits administers the employee benefit programs of several thousand small and medium sized companies located across Canada, and has relationships with over 250 third party brokers, through which its products and services are distributed. Sirius Benefits' founder, President and CEO, Ed Melna, and its management team and staff, bring significant experience in the group benefits market, and have used their deep knowledge and expertise to grow Sirius Benefits into one of the leaders in the small group segment in the Canadian marketplace. Mr. Melna, and all of the management and staff, will continue on with the business after the closing of the Transaction.
Mr. Melna added, "I am very pleased that Sirius Benefits is joining the People Corporation group of companies. Given our geographic proximity, I have had a front-row seat as People Corporation has successfully executed its ambitious growth strategy. I also have a strong appreciation for how People Corporation has the same focus on partnership, client service and creative solutions as we do at Sirius Benefits. I am confident that our broker-partners and clients will continue to benefit from this culture and style of doing business, and going forward will also gain access to a host of additional value-added products and services that a national organization the size of People Corporation can bring to the table."
People Corporation has purchased 100% of the shares of Sirius Benefits for $15 million, subject to post-closing adjustments. Of the total purchase price, $13.5 million was paid on closing of the Transaction, with the balance to be paid by way of deferred payments on the first and second anniversaries of the closing. The amount paid on closing was funded through drawing on the Company's existing senior credit facility, which will continue to have significant available capacity, allowing the Company to continue to pursue additional acquisitions as part of its growth strategy.
Mr. Goldberg continued, "We are very pleased to welcome Ed and the Sirius Benefits team into the People Corporation family. We look forward to building upon the already strong relationships that Sirius Benefits has with its broker-partners, and to providing them access to value-added products and services from our portfolio that they can offer to their clients. As the momentum of our growth strategy continues, we are well-positioned with a strong team, significant capital, and an exceptional reputation for working with our partners to structure transactions that achieve all parties' objectives."
About People Corporation
People Corporation is a national provider of group benefits, group retirement and human resource services. The Company has offices across Canada; each led by a team of experts and backed by the resources of a national company that is traded on the TSX-V. The Company's industry experts provide uniquely valuable insight while customizing an innovative suite of services to the specific needs of its clients. Whatever your sector, whatever your scale, putting People Corporation's expertise and proven track record to work will make a difference to your people and your bottom line. Further information is available at www.peoplecorporation.com.