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Alternative mortgage lender Home Capital to be bought by Smith Financial for $1.7-billion

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A company controlled by billionaire financier Stephen Smith has reached a deal to acquire alternative mortgage lender Home Capital Group Inc. HCG-T for $44 per share in cash, for a purchase price of nearly $1.7-billion.

The offer from a subsidiary of Smith Financial Corp., which already owns 9.1 per cent of Home Capital, represents a 63-per-cent premium to its latest stock price and a 72-per-cent premium to the average trading price over 20 days up to last Friday.

But the deal isn’t set in stone. The agreement includes a “go-shop period” until Dec. 30 during which Home Capital and its financial advisers can solicit bids and enter into negotiations with rival buyers. If Home Capital terminates the agreement with Smith Financial to accept a better offer within the go-shop period, it will pay a $25-million termination fee. The fee doubles if Home Capital seals an alternative deal more than five days after December 30.

Home Capital’s board “concluded that the transaction is in the best interests of the Company and fair, from a financial point of view, to shareholders,” said board chair Alan Hibben, in a prepared statement. “We are pleased to have reached an agreement that provides shareholders with compelling and certain value in the form of an all-cash offer.”

Three months ago, Home Capital disclosed that it had rejected an unsolicited takeover offer from an unnamed bidder. Mr. Smith, who is executive chairman and co-founder of rival mortgage lender First National Financial Corp., was widely thought to have been the most likely bidder at the time.

Home Capital rebuilt its fortunes after a near-collapse in 2017 and has consistently been one of the leading providers of alternative mortgages – those offered to borrowers who struggle to qualify at a major bank, often because they have mildly bruised credit, are self-employed or are newly arrived in Canada. But Home Capital’s share price has tumbled 39 per cent over the last year as soaring interest rates put pressure on the housing market and already stretched home buyers.

The acquisition would add to Mr. Smith’s already significant stake in Canada’s mortgage industry. In addition to leading First National, he is chairman of Canada Guaranty Mortgage Insurance Co., one of the country’s largest private mortgage insurers which he owns in partnership with Ontario Teachers’ Pension Plan. He is also chairman and co-owner of Fairstone Bank of Canada, formerly Walmart Bank Canada, which offers mortgages among other loans and financing products.

“With its talented work force, diversified presence across Canada, trusted positions as a lender and deposit-taker and 36-year operating history, Home Capital is a strategic asset,” Mr. Smith said in a news release. “I look forward to owning another business with a bright future.”

The deal needs approval from two thirds of Home Capital shareholders at a special meeting, and is subject to further approvals from courts and regulators.

The transaction is expected to close in mid-2023, but if it closes on or after May 20, the purchase price goes up by three-tenths of a cent each day – or about 25 cents per share for each three-month delay.

In the meantime, Home Capital intends to keep paying its quarterly cash dividends.

BMO Nesbitt Burns Inc. and TD Securities Inc. are Home Capital’s financial advisers, and RBC Dominion Securities Inc. is adviser to Smith Financial. Torys LLP acted as legal adviser to Home Capital, and Stikeman Elliott LLP for Smith Financial.

BMO, TD and Deloitte LLP each provided opinions that the transaction is fair.

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Banks lower prime rates in line with Bank of Canada rate cut – Financial Post

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  1. Banks lower prime rates in line with Bank of Canada rate cut  Financial Post
  2. Bank of Canada rate cut sparks optimism in Ottawa  CTV News Ottawa
  3. Monetary Policy Report Press Conference Opening Statement  Bank of Canada
  4. Bank of Canada lowers key interest rate to 4.5%, hints more cuts could follow  Toronto Star
  5. How will the Bank of Canada rate cut impact the real estate market?  BNN Bloomberg

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Vancouver City Council passes gas directive and some folks ain't happy – Daily Hive

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Vancouver City Council passes gas directive and some folks ain’t happy  Daily HiveView Full Coverage on Google News

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Before Spending Money on a ‘Career Coach,’ Do Yourself a Favour, First Try These Job Search Strategies

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I’m sure you’re aware of the “career coaching” industry—Internet talking heads promising job search and career success—that’s sprung up in recent years. Worth noting: The industry is unregulated. All career coaches are self-proclaimed; no certification or licensing is required.

 

Career coaches have one ultimate goal: To make money off you.

 

Today’s tight job market is making job seekers frustrated and desperate, which career coaches are taking advantage of with their promise of insider knowledge, personalized guidance, and a direct line to the hidden job market. Career coaches market themselves as a shortcut to finding a job, which is appealing when you’ve been unemployed for a while.

 

I’m not averse to hiring a career coach to assist you with your job search; it’s your money. However, keep in mind a career coach…

 

  • is a significant expense, especially if you’re unemployed
  • will only offer common sense advice, nothing that you probably already don’t know or haven’t read or heard before, and
  • doesn’t have insider knowledge

 

…and you’ll still need to do the activities related to job searching.

 

When asked, “Nick, should I hire a career coach?” my answer is an unequivocal “No!” Conducting your job search solo will not only save you money, you’ll also be developing job search skills you’ll need for the next time—chances are there’ll be a next time—you’re job hunting. Before spending thousands of dollars on a career coach, I suggest first trying the following job search strategies.

 

Optimize your online presence.

 

In today’s digital-first job market, employers will check your online digital footprint to evaluate your candidacy; are your interview-worthy? Start with the obvious: Ensure your LinkedIn profile is up-to-date and showcases your quantified accomplishments (a non-quantified statement is an opinion) so employers can see the value you can add. Do yourself a favour, read LinkedIn Mastery: A Comprehensive Guide to Navigating Digital Landscapes Effectively, by Benjamin Stone.

 

Necessary: Stay active on LinkedIn!

 

Your LinkedIn profile can’t be non-active. Maximizing LinkedIn’s potential requires regularly engaging with content, commenting on posts, and contributing original content. Engaging actively and visibly on LinkedIn will lead to opportunities.

 

Next:

 

  • List your social media accounts.
  • Deactivate accounts you are no longer using.
  • Set any accounts you don’t want prospective employers or recruiters to see to private.
  • Ensure your social media profiles (g., display name, handle, headshot, bio) convey the same message about your professional background.

 

Leverage your existing network (a low-hanging fruit few job seekers take advantage of).

 

Everyone has a network of some sort. This means since all job opportunities are attached to people—good news—there are job opportunities all around you. Often, your barista, dentist, hairstylist, neighbours, fellow members of whatever club or association you’re a part of, and, of course, family and friends can help open doors for you.

 

Tell everyone you know that you’re looking for a new job. Always carry extra copies of your resume and hand them out when appropriate. You’ll be surprised at the number of people willing to help you when they understand your situation.

 

Read these two books:

 

 

Ferrazzi outlines practical strategies for building relationships, networking, and leveraging connections

.

 

Hollins provides actionable strategies for achieving your job search and career goals, such as overcoming procrastination and boosting productivity with focus and discipline.

 

Apply less, connect more.

 

Applying online is a waste of time. In previous columns, I’ve noted that applying online is comparable to playing the lottery; you’re hoping a stranger hires you. Numerous studies have shown that most jobs aren’t advertised; they’re filled through connections and referrals.

 

Job searching today is a long game; you need to be patient. Today, you need to network your way into a company and identify opportunities, which no career coach can do for you. It’s unlikely the resume you submit online will be reviewed. Paying to have your resume redesigned won’t get it more views; getting it in front of people who can hire you will.

 

Take what you will from the following.

 

A few months back, a job seeker asked me, “I’ve been working as a help desk agent at a healthcare software company for five years. I want to become a Director of IT at a large multinational company. What should I do?”

 

How should I know? I’m not a Director of IT. Why not ask the Director of IT at a large multinational company?

 

Take advantage of the fact that people love talking about themselves. Dinner with someone who holds the position you aspire to is a better investment than hiring a career coach who lacks your dinner partner’s real-world experience. I charted my career path by observing those ahead of me and seeking their advice. Talking to people who are where you want to be will benefit your job search and help you achieve your career aspirations.

 

By shifting your mindset, optimizing your online presence, leveraging your existing network, staying engaged on LinkedIn, and connecting with the right people, you won’t need to hire a costly career coach, and you’ll develop skills you can use throughout your career.

_____________________________________________________________________

 

Nick Kossovan, a well-seasoned veteran of the corporate landscape, offers “unsweetened” job search advice. You can send Nick your questions to artoffindingwork@gmail.com.

 

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