Mortgage broker giant moves forward with preferred share buyback to simplify operations
Dominion Lending Centres Inc. (DLCG), one of Canada’s largest mortgage networks, has secured shareholder approval for its plan to repurchase all of its non-voting Series 1 Class B preferred shares.
The share buyback is part of a broader strategy to simplify the company’s capital structure and consolidate ownership under a single class of common shares, DLC said in October.
These shares, held primarily by KayMaur Holdings Ltd., a company associated with DLCG executives Gary Mauris and Chris Kayat, along with other stakeholders, will be exchanged for 30.5 million Class A common shares and a $15 million cash payment.
The approval came during a special meeting of Class A common shareholders, where 99.99% voted in favour of the buyback proposal, according to a press release. Shareholders authorized the company to repurchase the preferred shares originally issued during its 2020 restructuring.
The preferred shares were created during a transitional period to separate DLCG’s core mortgage operations from non-essential assets. With those assets now sold and associated debts fully repaid, the preferred shares are no longer needed.
“While the preferred shares served the corporation well for a transitional period, we understand that the time has come to simplify the corporation’s capital structure and have one class of common shares,” DLCG chairman Gary Mauris said in an earlier statement.
The shareholder vote also approved amendments to the company’s articles of amalgamation to cancel the Series 1 Class B preferred shares entirely once the transaction is completed.
Shareholders representing 81.24% of the company’s total outstanding common shares participated in the meeting. Even after excluding votes tied to Mauris, Kayat, and their affiliates, the buyback plan maintained overwhelming support.
The company expects to complete the transaction by December 17, 2024, subject to regulatory approvals.
Read next: DLC posts double-digit revenue and volume growth in Q3
Since its founding in 2006, Dominion Lending Centres has grown its mortgage broker network to over 8,500 agents operating in more than 500 locations. The company’s divisions – MCC Mortgage Centre Canada Inc., MA Mortgage Architects Inc., and Newton Connectivity Systems Inc. – support brokers and clients across Canada.
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