"The acquisition of Collins Stewart Hawkpoint will be a transformational expansion of our business and will firmly position Canaccord as a leading global independent investment bank. When the transaction closes, Canaccord will have operations in twelve countries and capabilities to list companies on ten stock exchanges,” Paul Reynolds, president and chief executive of Canaccord, said in a statement.

Canaccord is offering 57.6 pence (89 cents) in cash and 0.07 of a Canaccord share for each share of Collins Stewart. The offer, valued at about 96 pence per share, represents a 90 per cent premium to Collins Stewart’s closing price on Wednesday.

The acquisition agreement is a sign of the kind of M&A deals that some commentators expect to see continue in the wealth management industry as firms cope with tight margins, regulatory costs and a desire to acquire new sources of revenue. The deal is also a sign of how Canadian financial institutions, that have been relatively robust during the financial turmoil of recent years, have the firepower to spread beyond their domestic market.

"The combination of Canaccord and Collins Stewart Hawkpoint makes strong commercial and strategic sense, greatly strengthening the enlarged group's capital markets, advisory and wealth management presence in North America, Europe and Asia. The offer price represents a substantial premium over the current Collins Stewart Hawkpoint market price. Moreover through this offer, shareholders receive both cash representing alone a premium to the current share price, and, additionally, Canaccord shares thereby also enabling them to participate in the growth prospects of the enlarged group,” Tim Ingram, chairman of Collins Stewart Hawkpoint, said in yesterday’s statement.

Canaccord provides services such as wealth management and global capital markets trading and investment. Collins Stewart Hawkpoint, meanwhile, has a strong presence in the London market and is also a substantial player in the wealth management market in locations such as the Channel Islands.

In November, the UK firm reported total revenues for the four months to 31 October slipped to £63 million (around $99.5 million), compared with £75 million in the same period a year ago. Assets under management at 31 October were £7.8 billion, compared to £8.1 billion at 30 June 2011; negative market movements were offset by net inflows of £104 million, most of which were discretionary assets.

Canaccord has 49 offices worldwide, including 32 wealth management offices across Canada. The international capital markets division has operations in the US, the UK, Canada, China and Barbados.

The Canadian firm recently acquired a 50 per cent. interest in the capital of BGF Capital Group Pty Ltd, rebranded Canaccord BGF, adding capital markets capability to the Canaccord Group in Sydney, Melbourne and Hong Kong.

The agreement, subject to shareholder approval, is expected to be effective in the first half of 2012.