Laurentian Bank of Canada reached a definitive agreement under which a subsidiary of the bank, LBC Capital, will acquire Northpoint Commercial Finance.
The transaction, which the companies announced last week, is expected to close before fiscal yearend 2017 — subject to regulatory notifications and approvals, according to a press release.
Alpharetta, Ga.-based Northpoint Commercial Finance, founded in 2012, is a U.S. and Canadian powersports and equipment inventory financier with a portfolio of approximately $880.2 million.
The company has been steadily boosting its powersports OEM partnerships throughout 2016 and 2017. Most recently, Northpoint signed an exclusive floorplan financing deal with Linhai Powersports USA Corp. in mid-January of this year. Additionally, Northpoint signed several multi-year floorplan financing agreements in 2016, including ARGO, Massimo Motor, and CFMOTO USA.
Laurentian Bank of Canada, based in Montreal, Quebec, believes Northpoint “is one of only a few diversified inventory finance companies” that provides the scale needed to serve North American manufacturers and their dealer networks, according to the release.
“We are delighted to announce this acquisition that will increase the proportion of revenue generated by commercial activities within the bank mix, which is expected to improve its overall profitability,” Francois Desjardins, president and chief executive of Laurentian Bank, said in the release. “We continue to make excellent progress on our transformation plan initiatives, including — among others — the optimization of our retail banking activities and the development of our core banking system, the backbone of our digital offer.”
The acquisition is expected to “broaden” Laurentian Bank’s Canadian offering and create a U.S. presence, which is an “important customer attribute for manufacturers and dealers looking for a single North American point of service,” said Stéphane Therrien, executive vice president of personal and commercial banking at Laurentian Bank.
Northpoint employees, led by Chief Executive Dan Radley, will join the Laurentian team under the leadership of Éric Provost, senior vice president of commercial banking at Laurentian Bank and president of LBC Capital, according to the release.
Separately, Steve Culp, chief financial officer and one of the founding members of Northpoint Commercial Finance, announced his retirement this week, according to a press release. While Culp officially retired effective March 1, he remains involved in the business on a “transitional basis working with team members to wind down key projects and initiatives,” according to a press release. “This process should continue through mid-summer.”
Culp spent the last five years of his career launching Northpoint and playing a critical role in the company’s growth. He previously held leadership roles in finance, treasury, and controllership in the distribution finance businesses at ITT Commercial Finance, Deutsche Financial Services, General Electric, and Textron Financial, according to the release.