IPH Limited (ASX:IPH) entered into an agreement to acquire Smart & Biggar Ip Agency Co. from Smart & Biggar for approximately CAD 350 million on August 18, 2022. Pursuant to the terms the consideration consists of an upfront cash payment of CAD 241m, an initial issue of 5.3m new IPH shares with a value of CAD 41m (escrowed for two years), and a deferred issue of new IPH shares (earn-out consideration) up to a value of CAD 66m (escrowed for two years).

The transaction consideration will be funded by debt facilities, cash reserves and the issuance of IPH shares to the vendors. IPH has agreed amended debt facilities with its existing bank financiers as a part of the transaction. A Smart & Biggar representative will join the IPH Group Leadership Team.

Completion of the transaction is subject to satisfaction or waiver of a number of conditions, including achievement / receipt of agreed regulatory registrations and third party approvals. The transaction is expected to complete in September 2022. Aquasia is acting as financial adviser and Watson Mangioni, Cassels Brock & Blackwell, and Lapointe Rosenstein Marchand Melançon are acting as legal advisers to IPH.

IPH Limited Smart & Biggar business achieved the full earn-out payment of CAD 66 million based on earnings in CY2022. IPH has therefore today issued 8,255,153 fully paid ordinary shares (Shares) to the sellers at an issue price of CAD 8.69 per Share. The Shares are also subject to voluntary escrow arrangements until January 1, 2025.