Ladies and gentlemen, thank you for standing by, and welcome to the Power Corporation Second Quarter 2021 Conference Call. At this time, all participants' lines are in a listen only mode. After the speakers' presentation, there will be a question and answer session, to ask a question during the session, you will need to press star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance please press star zero. Now, Now, I would like to hand over the conference to our speaker today, Mr. Jeffrey Orr, President and Chief Executive Officer of Power Corporation of Canada. Thank you. Sir, please go ahead. Thank you very much, operator. Good morning, everyone. Thanks for being with us on a Monday morning in the summertime. We're very pleased to be presenting our results and speak about some of the activities of Power Corp over the last quarter or so. I'll just draw your attention before we get going to the cautionary statements on pages two and three. With that, on page four, in addition to myself, there's also Greg Tretiak with me, Chief Financial Officer, Executive Vice-President of Power Corp, and known to most of you, I believe. I'll switch over to page six on the presentation. You have there a number of the documents and events that form part of our communication to investors that have come out over the last weeks from both Power Corp and Great-West, IGM, and GBL. All those documents are available online to you if you so desire, if you haven't already looked at them. With that, I'll start on page seven and just kind of resume the quarter and the last, I guess, four months or so. Really pleased with how the companies are performing, both from an organic and an inorganic point of view. We really had a lot of progress that's become evident in the quarter. Very strong earnings at each of the operating businesses and strong business momentum. It's a theme that we have been communicating for at least a few years that we believed that a lot of the investments that we had made at Great-West, IGM, GBL were going to translate into good business momentum. We've seen in the last quarter that was absolutely true across the board with the strong earnings and momentum at Great-West, led by Empower, both organically and inorganically. IGM just kind of across the board, across the business units, really demonstrating great momentum. GBL benefiting from a lot of the portfolio changes they've done in the last few years. Great organic growth. Also, you see with the, obviously the Prudential acquisition was the highlight since we last talked in terms of being an external transaction. We'll talk some more about that in this presentation. We've got a few pages where we'll give our perspective on the Prudential acquisition. Great-West also was active in Ireland and in Canada with an acquisition in the group insurance sector with the acquisition of ClaimSecure, a third-party administrator. When you come to the Power Corp level, we continue to make progress on our strategies. One of those we'll talk a little bit about is GP Strategies. We announced a transaction that's one of the four standalone businesses, where with that transaction will not only surface value, but upon the closing will actually exit the position and monetize that position in furtherance of the strategy that we've communicated to you many times. The alternative asset management businesses that we're building at Power have continued to make good progress on fundraising. You have a couple of examples there at the bottom of page seven, but there's more that we'll talk about briefly when we get into the presentation. Turning to page eight. From a financial point of view, a great quarter. NAV was up quite strongly, and that continued subsequent to quarter end. We had strong earnings. CAD 1.47 was very strong earnings and earnings per share. It was a record adjusted earnings per share at CAD 1.51 and well up from the previous year. Then we kept our dividend at the CAD 44.75 level. As you know, dividends from our public operating companies have been flat, and in particular, their Great-West Lifeco, which is a big part of it, is still with an OSFI restriction on increasing dividends. So that we have maintained our dividends at the CAD 44.75 level. With that, I'm going to turn the microphone over to Greg Tretiak to talk about the next couple of pages. Greg? Thanks, Jeff. I'll give a little color on the net asset value and the earnings for the quarter. First on page nine, net asset values, as Jeff had mentioned, CAD 51.60, up 12% from March 31st. Since then to August 6th, up another CAD 1.50 at CAD 53.10. Great-West Lifeco and IGM and GBL, all three you can see the strong earnings and good momentum being reflected in the share prices. You can see now that the net asset value for the three of the publicly traded companies are share of it, CAD 32.4 billion. I just note that in Sagard Holdings, that's where our interest in Wealthsimple shows, and that's, I was going to say about CAD 800 million. It's actually CAD 796 million. The other I'd highlight is ChinaAMC. We talked about this at the last call. It's still on our books at book value at our 2017 purchase price. I think I reflected last time that was around 17.5x earnings, the entry multiple was. That has not been adjusted for any further market increases given their strong performance. Standalone businesses, our 35.7% interest in Lion is in the standalone businesses, and GP Strategies is in there as well. There is a separate slide we'll talk about a little later on in the presentation. Take us to page 10 and PCC earnings per share. Record earnings, I should say record adjusted net earnings of CAD 1.51, compared to CAD 0.79 in Q2. Here I'd go through a couple of highlights as well. Certainly with Great-West Lifeco, another strong quarter led by increased contributions from Empower, reflecting the recent MassMutual acquisition. IGM had record earnings in the quarter on record assets under management and Q2 high net sales for Q2 as well. I'd just note on GBL and the effect of consolidation. The effect of consolidation includes any adjustments that we need to make for differences in accounting. Of course, GBL uses IFRS 9, so gains and losses on dispositions are recognized as fair value through OCI. None of their dispositions go through the earnings line, whereas we still use IAS 39, we do reflect it. Most of that CAD 0.14, in fact, all of that CAD 0.14 is basically the effect of the gains being recorded in our P&L from the dispositions that GBL did on Holcim, Umicore, and GEA. Down the page, alternative asset management platforms. Certainly, there was activity at Power Pacific in the portfolio there. Also in Sagard Europe, the sale of a couple of portfolio investments there as well. Contributing CAD 0.18 in the quarter. As I mentioned, ChinaAMC had a strong quarter up 33%. Their asset management was also up comparatively, their equity product sales were strong throughout the quarter. In standalone businesses, we have CAD 0.23 contribution. A large component of that came from Lion recognizing its merger with Northern Genesis and also a contribution from GP Strategies in the quarter. With that, I think I would turn it back to Jeffrey Orr. Okay, Greg, thank you. I'll turn to page 11. The next few pages I won't dwell on. You've seen them before, but they are here to reiterate that our strategy is we're pursuing it in a pretty disciplined way, I would say, where we're focusing on financial services. Each of the public operating businesses have their own organic and inorganic strategies. We have a whole series of steps that we're taking at Power Corp to add to that value. At the bottom of the page, across the Group, we are committed to continually enhancing our communication to the marketplace and as well as the quality of the communication and the quality of the material. That's what the strategy is. Page 12 simply expresses it in a different way. I won't spend any time on 12, but that's the same strategy just laid out in a different fashion. On page 13, just spending a moment here for our public operating businesses. The first bullet point, they have gone through years of investing in their businesses to make them more competitive. The management teams at each of the businesses are very focused on turning that into higher earnings and cash flow growth, and in the case of GBL, higher NAV growth. They are doing so as well with an external M&A strategy. The third bullet point is really about looking at the portfolios actively and saying, "Are there businesses in there that don't meet our objectives, and what can we do about that?" All three of those are being pursued actively by the management teams. As I said, everybody's out trying to enhance the quality of their communication to our different stakeholders. Page 14, I won't go through all of these bullet points, you just see across Great-West Lifeco, really broad-based progress in the quarter. Across IGM, the earnings, record net flows at both IG Wealth and Mackenzie. Record earnings, it's just firing on all cylinders right now. At GBL, Greg mentioned a number of the dispositions, those dispositions are coming in holdings. We've got a few examples there where a lot of the investments at GBL recently have been rotating into more private type investments. That is part of the active rotation going on at GBL that is what they think will drive a lot of value for the company. They're also focused on share buybacks to try and work and narrow the discount to their net asset value. Okay, page 15. Spend a few pages here sharing with you our perspectives on the acquisition of Prudential that was announced by Great-West Lifeco. We're really excited about this transaction. We think it is not only a great deal strategically for Great-West and Empower, but it's also a very strong deal financially. It will create, assuming we achieve our synergies, which we believe we will, 8%-9% earnings per share accretion. It comes on the heels of the MassMutual deal a year ago, which itself was a 10% earnings accretion on Prudential. We financed it without any equity, but we look at it and say, "Well, what would it have looked like had we done a 70/30 equity debt financing consistent with Great-West Lifeco's long-term capital structure?" Even on that basis, it's an 8.1 x PE multiple. We think we did a very strong deal financially. We're really excited about it. Like the MassMutual deal, most of that EPS accretion, the overwhelming majority, comes from cost synergies, which are things that we've got a high degree of confidence on because we're just simply porting the businesses onto Empower's existing platform, and we know the costs very well. Very confident on the cost side, Most of those EPS numbers are based on costs, whereas longer term, medium term, longer term, the revenue synergy is not really baked into the numbers in any material way, are in fact a great opportunity as we look down the road. I will turn to page 16. That's just a visual as to in the defined contribution market itself how the transaction is transformative in positioning Empower and its size and scale. It is becoming very much a scale game in the defined contribution business and Empower on top of the investments it's made in its platform over the last number of years to enhance and create a very competitive client experience for both the plan sponsors, that's to say the employers and the participants. We are also very focused on getting the scale to be able to continue to invest and drive your cost point down to a lower point than industry competitors. Page 17. There's a stepping back for a moment here. These transactions that Empower has done have really transformed the business. The first thing they've done is that they've set Empower up to be an industry leader with a business model that will thrive in the defined contribution space. They've also transformed Great-West Lifeco. They've transformed Great-West Lifeco's business mix and its earnings profile. If you just go back to the Personal Capital transaction, which I think was the last week of June or the second last week of June, I can't remember the exact date. Then you go to Prudential, which was the third week of July. Over a period of 13 months, a little under 13 months, Great-West Lifeco has deployed $8 billion, roughly CAD 10 billion on three transactions. Those transactions will materially impact the business mix at Great-West, where all of a sudden when they're fully baked in and synergized, Empower itself in the U.S. will be a very significant part of Great-West Lifeco's business and its earnings. The earnings profile itself has been altered in that we think, given the dynamics going on in the defined contribution business, that we can grow strong earnings in a consolidating market for quite a few years to come. The business mix, the earnings mix, the growth profile of Great-West Lifeco has been transformed by three very large transactions. I'll just reiterate that I think the economics we've shown are based principally on costs. The real medium to long-term opportunity is the retail wealth management opportunity that is adjacent to the defined contribution business. The company has to execute on that, no doubt. We're confident we can do that. That medium to longer term, when you look out beyond two years after the deals, that will make these deals go from good to great if we can execute on it, and we think we will. That's our perspective. Happy to take questions. Very excited about the Prudential transaction. Page 18, continued good fundraising by Sagard and by Power Sustainable. You've got under the second bullet point a number of examples of additional fundraising. It included a SPAC that Portage completed just in July, $240 million USD. Power Pacific, which is the team of investment managers that are based in Shanghai that were initially set up in 2005 when Power was accorded a QF license and was managing basically Power's money and have a great long-term track record out doing fundraising because we're trying to fund all of our strategies primarily through third-party capital. They've been having some good success in attracting third-party capital, including an institutional commitment, which is not funded yet from a U.S.-based pension plan in the second quarter. Really excited about continued good progress on building out the third-party fundraising on our platforms. Page 19 is an example of what we're trying to do on the disclosure front. These numbers are in the MD&A, and I'm not intending today to go through a long diatribe on how the financials work. We probably should do that in some subsequent sessions when it's not just a quarterly earnings call. You see we are breaking out the management fees for Sagard Holdings and the platform expenses, and then they also get money, of course, from a carried interest when there are gains. Those are, the carried interest line is a lumpy one, but a very meaningful part of the economics over time. We have the same thing for Power Sustainable. As I said, these numbers are in the MD&A. This is part of our ongoing effort to illustrate the economics both as a GP, and we also have a fair bit of work to do on illustrating how we make money on our seed capital as well. You're going to see continued enhanced disclosure on this front as we move forward. Page 20. As we talk a lot about alternative asset management, and we're doing it at Power Corp, but it's also going across Great-West Lifeco and IGM and GBL. This page is just intended to give you a little bit of the logic as to how each of our operating businesses look at alternative asset management. For example, at Great-West Lifeco, where they're invested in the Power Sustainable Energy Infrastructure Partnership, they're also invested in Portage and in credit funds, and they're, of course, an investor in Northleaf. They're trying to do three things. They're trying to advance their strategy and advance their capabilities for their own balance sheet needs. They're trying to access product for their customers and their clients. On the fintech front, of course, there's also a whole additional strategy being played out to remain at the forefront of fintech developments because it impacts their own core businesses. At IGM, it's almost the same, but there's one difference. They don't have a balance sheet to invest, so they are not trying to put their own capital to work for a balance sheet purpose. With the ownership of 80% of the position we have in Northleaf, it actually has put them into the private alternatives business in a meaningful way. They've expanded into a whole new market, both in terms of the capabilities within Northleaf as well as all of the distribution channels that come with that. GBL is increasingly focused, as I mentioned, on private investments. They do have their own Sienna Investment Managers, and they're expanding that business. A fair bit of cooperation between GBL and Sagard in Europe on opportunities that may not be exactly suited for one but would be suited for the other. They're in active dialogue, and there's common directors on the two companies so that exchange of information goes on. Okay, page 21. I won't really add anything to what Greg mentioned. Good progress at China AMC. We don't have their track record there. We just got the market performance of the indexes, but they've got great long-term alpha creation. They've continued to grow their business successfully. China AMC, I would say, is an institutional player, it's a mutual fund player, and it's an ETF player. They continue to build out their business success. They're really pleased with the progress being made. Okay, stand-alone businesses. Just for a moment here. We have got the four businesses that we consider the stand-alone businesses. We now have 73% of the NAV that we disclose as public. This is getting easier to measure. You know about Lion Electric. We've already talked fair a bit about that. GP Strategies, as I mentioned, there's a transaction there that, assuming it closes, we'll monetize that transaction. Lumenpulse, you may be aware, did file to an initial prospectus to do an IPO, got into some choppy markets, and the decision was made not to go in that direction at this time. You may say it's a funny thing to mention on a call to talk about an attempt that didn't work. We mention it in the context, we're active. We said we were going to surface value on these businesses, and over time, we were going to realize value. Here we are not that long after having announced the reorganization. We've been active on all fronts here on making this piece of our balance sheet become clearer surface value and ultimately realized value for Power Corp. Okay, over to page 23. We've continued to make good progress on our target of achieving CAD 50 million in expense reductions. We're almost there. You've got across the top of the page the bullets as to how we've done it. Effectively, what you've got on the bottom right is we had just about CAD 200 million in operating expenses between Power Corp and Power Financial in 2019, which was a CAD 50 million quarter run rate. We were at CAD 40 million in Q2 2021. Our target is CAD 38 million. We're getting very close. These are quarterly representations. As in any company, from quarter to quarter, they can bounce around. We think on a run rate basis, we're getting very close to our targeted reductions. We're pleased about that. A word on 24 on our communication strategies. Power Corp itself, of course, is continuing to work hard on the investment platform disclosure. Still some work to do there, but we'll continue to make progress on that. We've been very active in meeting with investors in 2021 to date. It actually is 100 investors and analysts we've met in different meetings. I probed and said, 'Isn't it approximately?' Currently it's exactly. We have had exactly 100 meetings. At Great-West Lifeco, I think quite meaningful, they hosted an investor day in June. Of course, the focus of it was on Empower. They also started off by doing something they haven't done in, as far as I can remember, ever, which is that they provided medium term EPS guidance of 8% - 10% base earnings growth, absent any future acquisitions. That was prior to the announcement of Prudential, of course. A target of 14% - 15% base ROE. This is just part of my messaging and our messaging that we are, across the group, trying to move forward and get our investor communications clearer and clearer. That was a big step for them, and I'm really pleased that they did that. At IGM, in the meantime, they've worked very hard, as you know, to show the segmentation of the business in the way that they think about it, and trying to surface to the value that when you look at the sum of the parts of IGM and you drill down on the different values, that there's still lots of opportunity there to surface value. I think they illustrate, when you look at all the other pieces of the company, that the wealth management business and the asset management business effectively is being valued at a very low value. Maybe it's the other parts, but in any event, there's a lot of value that's not getting recognized in the share price, and they're on a tear to get the market to focus on the sum of the parts first evaluation. I think that's getting tenure and increasingly getting recognized by the analyst and investor community. Greg, I'm going to turn to you to just say a word about our liquidity and cash on page 25. Thanks, Jeff. Start off with the important number. How much cash do we have? We've got about CAD 1.1 billion in terms of our cash reserves on the balance sheet. We're looking forward to resuming our buyback program. When we look forward, we look at three things. Certainly, our cash balance, and it's on the higher side of the 2x to 3x fixed charges that we've guided folks on in the past. The other thing is obviously the pandemic and the economy, and certainly we're seeing that there's a move to opening up across the board in Canada. That is looking good for the fall. Finally, we've talked about where OSFI will be with its guidance with respect to dividends and buybacks. We are certainly looking forward to what OSFI will have to say in the coming months as well. Jeff, I turn it right back to you. Okay, thanks, Greg. Page 26 is our discount to NAV. It's something we're focused heavily on. We've continued to make good progress through all of the strategies that we've executed on in narrowing that discount. We still think there's progress to be made there and lots of opportunity ahead. The way we think about it, this journey on narrowing it actually started back at the start of 2019. A lot of people talk about it from the reorganization, which we announced at the end of 2019. We sold the U.S. life insurance business to Great-West Lifeco. Great-West Lifeco did, I should say. We embarked on a three way share buyback that was intended to return capital and take advantage of the NAV discounts at Power Financial and Power Corp, which those discussions led to the decision to do the reorganization in the fall, which was announced in December 2019. With a little bump in the road when COVID hit and we got into a big market downdraft and our stock gapped down, we've made steady progress as we've executed on the strategies at the operating businesses and the strategies at Power Corp itself and our communication, and continue to see good progress. That's one of the levers of value creation that we remain highly focused on. Page 27. You've seen the slide before, but this is on the left-hand side of the page. We think about the value creation, it translates into four drivers of growth on the right-hand side of the page. Higher earnings per share at our operating businesses, principally. The potential for the multiples of Great-West Lifeco and IGM to increase as a result of that, both organic and through M&A. GBL potential to increase its NAV. The third bullet point, higher NAV across Power Corp. As a result of what we're doing at our operating businesses and what we're doing at Power Corp, higher NAV. Focused on the last element, which is the discount through good communication and good visibility as to how we're creating value going forward. That's how we think about value creation. Just before I conclude, I would say on page 28, I'm sure as in your businesses, there's not a management meeting or a board meeting we go to across the group that we're not talking about ESG. I think our companies are very well positioned for ESG going forward, which is not to say that it's not a continually moving target and that there isn't a lot of work, but also opportunity ahead for our group because we have been very strong on good governance principles. Thinking about our community, thinking about how we are good corporate citizens. That's reflected in some of the measures that you see here. Including, I just point out, I know IGM likes to say it, they were actually first among all investment service companies worldwide in the Global Corporate Knights Global survey recently. Across the group, really, this is a big focus, and you'll hear more about it as we continue to move forward. Page 29 just kind of summarizes how I started the presentation here. Really thrilled about the strong organic growth that's being shown in our companies from a business momentum point of view and an earnings point of view. Of course, the strong stock market helped, there's no question. It's way beyond that in our view. The growth and the strength is much more fundamental than that and much more deeply rooted than that. Then we're adding to it with continued high level of M&A as we said we would. Just really pleased with the great progress we're making. Lots of opportunity ahead. Really fun to report a strong quarter like that. With that, I will, operator, stop our formal remarks or our address and would like to open it up to questions from those on the call. Thank you, sir. As a reminder, we will now begin the question and answer session. If you wish to ask a question, simply press star then one on your telephone keypad. Once again, that is star one on your telephone keypad. We will pause for just a moment to compile the Q&A roster. Your first question is from the line of Nik Priebe from CIBC Capital Markets. Your line is now open. Thanks. In your prepared remarks, you discussed the attempt to take Lumenpulse public. Perhaps without asking you to divulge any specifics, would you be able to give us a general update on the monetization pipeline that you see in front of you for the other standalone businesses? Do you feel that you'll be able to make some further progress on that front over the next 12 months or so? Just some color around those efforts would be helpful. Nik, it's hard to respond to that in a definitive way. I don't want to be evasive, but when you are sitting on businesses and you own shares, you don't want to be out there saying, "We're going to get it done by such and such a date." It would be like an investment manager going out and telling their trader to tell the world that you got to get off this position by a certain period of time. What does that do? You end up with bad traders, right? Because they don't do that kind of thing. I guess what I would say is that we've taken steps to surface the value to create liquid markets. For example, for Lion, we attempted at Lumenpulse. That puts you in a position where it can be easier to then take the next step, which is to find attractive opportunities to monetize it. I don't want to get into. All I'm going to tell you is we're focused on it, and when the opportunity is right, we'll act. I don't want to get into putting any kind of a false deadline on it so that we'll just end up hurting Power Corp and the management teams that are building and share. Partners that are building these businesses. They're great businesses. We've got great partners. They're doing a great job on these companies, building them out. I just don't want to put anybody's back to the wall. It's not fair. I'm going to dodge your question, but just to tell you we're focused on it, okay? We're very focused on it. Yeah, no, fair enough. I can appreciate that. Just a point of clarification. Greg, I think when you were discussing the corporate cash balances, if I caught it correctly, I think you stated that you're holding CAD 1.1 billion, which compares to CAD 1.3 billion reported on June 30th. Is the inference there that you've been deploying excess cash subsequent to quarter end? No, good attention to detail, Nik. We always adjust our cash from the balance sheet in terms of looking at how much we have available by, there's the dividends that are payable very early in the ensuing quarter. Early in July, we're paying dividends, and so we make an adjustment for that amount, so that we know what our cash basically is, going forward to be able to deploy. Okay, understood. Last one from me. It appears there was pretty significant progress made in the quarter with respect to achieving targeted expense reduction. Can you give us just a little bit more insight on, I guess, what areas those savings came from? Yes, we can. Actually, Greg, do you want to handle that? Sure. I can handle it, but why don't you? Why don't you take that? Sure, no. Yeah. Nik, we're fond of when we've got a big target, we want to take it piece by piece. We've chunked it down, and we made progress in virtually every one of the areas, in terms of the targeted areas. We did a lot of work on our travel and our physical footprint in the quarter and continued in each and every one of the categories that is listed on that page. Of course, we're nearing Q1 of 2022, which is the target date. People have had their shoulder to the wheel and making sure that we can get there by that time. Okay. Very good. That's all I had. Thanks for taking the questions. Thanks, Nik. Your next question is from the line of Graham Ryding from TD Securities. Your line is now open. Hi, good morning. Hey, Graham. The first question would just be on your capital and your commentary around you like to have a minimum balance, I think, of 2x to 3x your fixed charges. Could you just spell out for us what that actually implies in terms of absolute numbers? Because I'm not sure I've got the right number for your fixed charges necessarily. Greg, that's for you, I think. Yeah, for sure. That'd be about 750-1,100, 2x to 3 x the fixed charges, Graham. Which is basically our expenses and our interest requirements on our preferred. Expenses that get down to CAD 150 and then you just take the preferred share dividends and the little bit of interest expense, right? You multiply it by two. Right. You multiply by three. Yeah. Okay. Understood. With your asset management arm, is there anything that you're targeting in terms of fundraising over the next year? I know you have a bunch of different verticals and things I'm sure are going to be unique for each one of them, broadly speaking, as a percentage of AUM or in absolute terms, do you guys have targets for what you're trying to bring in terms of third-party capital? I think that's putting a fine point on it. Sagard Holdings and Power Sustainable Capital have different strategies in each. There are more strategies in Sagard Holdings right now. They've got royalties, credits, fintech, for example, the private equity business in Europe. They're always looking at what new strategies can be launched alongside those. Each of those groups are out fundraising. I don't have the page in front of me here. Sorry, just lost it on my screen. Okay, I'll come back to it. You see at Sagard Holdings, good progress along each of those strategies. I don't know that they had a SPAC in their headlights a year ago, but the opportunity to do a SPAC came up. Even in a weak SPAC market, it's quite something they were able to pull that off, and it's a tribute to the track record they've got in the fintech space and the investor base that they have. I don't have a specific target in mind. They're out fundraising, sometimes it's tough going, and sometimes they come back and say, "We've just made great progress on this fund." We know where they're active, but we haven't thought about it in terms of new capital. I think on the Power Sustainable Capital line, they've got two principal strategies. Which is their infrastructure and their China strategy, and they are looking to what new products they can launch to broaden that out. As they get into new products, that's a good example of where Power might have to put up more seed capital than they would on an existing product that's on its second or third fundraising, where we won't have to put up much capital. On a new product, the sponsor's got to show their confidence in the strategy. These things are all moving. We actually haven't got it down to being, over the next 12 months, this is what we're expecting. I don't have that number. Greg, you may, but I don't. We don't think of it that way. What we do say, and what they're very clear on, is that we are on a march to increase the businesses where they become principally third-party funded. Ultimately, Power ends up being a much smaller piece of the capital. Greg, anything you'd add to my comments? The only thing I'd add, Jeff, is that it depends on the maturity of the particular asset class as well. Certainly, Sagard Europe, for example, which we've been active in for many, many years, and it's in a mature set of funds. We would expect that because it's mature in the future, we wouldn't be putting as much capital in. You'll see that, I think, with each one of the particular asset classes. Depending on the type of the asset class, some require a little more seed capital for us to get up and running, and some a little less. I guess that's the color I'd add, and that's something maybe we can look at for a future quarter to give a little finer point on it, if you will. Nope. No, that is helpful. My last question, just seeing the big increase in the GBL related NAV quarter-over-quarter. Was there anything that you would highlight there that did some of the heavy lifting through the quarter? Was it broad-based? Mr. Tretiak is going to answer that question. Yeah, I think we've got a slide on the back, but I don't know that it actually breaks down the increase. It was pretty much across the board. Some good movement, actually, in the private holdings. Webhelp was up significantly. Of course, you would've seen that there was a put right associated with that, and that was reflected as well in the quarter. Those are my comments, Graham, and certainly, if you look back on our previous presentation, you'll be able to see it specifically. Okay. Great. That's good. Thank you. Thank you, Graham. Your next question is from the line of Jaeme Gloyn from National Bank. Your line is now open. Hi, good morning. Good morning. I wanted to just start with the asset management business. The AUM seems to be building very nicely. The profitability seems to be improving slowly. Do you have a sense in terms of what level of AUM is required or timing around when we should expect to see this business start to ramp up in terms of profits? You're talking about the businesses at Power, I assume? Correct. When you say asset, yeah. A few ways to think about it. Very good question. I think that Sagard Holdings, as we've talked about, has got a broader footprint with more strategies. It is closer to a point of breaking even. You need to think about the P&L on these businesses in two ways. One of them is they have fee revenue, and they have ongoing expenses. The second piece of it is there's a carried interest, and those would be more prevalent, let's say, when there's private equity than when there is a strategy like infrastructure, where you wouldn't expect kind of sudden gains or periodic gains, is a better way to put it. The first thing we look at is just on a fee basis. Forget about the carry. When do we get to the point where the fees are going to cover the expenses, the run rate expenses? Then when you actually look at the overall economics of being in the business, you look at the carry as well, but that can be lumpy. On a fee basis, I would say that Sagard Holdings would be, I would hope within two years here, is going to be with its head above water, and contributing. I think it all depends on fundraising, of course. Then on the Power Sustainable Capital side, they're at a little bit earlier stage in terms of their products and their fundraising. They're probably one or two years beyond that. As we've communicated to the market, we kind of look out and say in three, four years, something like that, we should be at a point where we can say, "Hey, we're making, it's not a lot of money right now, but we're making X million on this business. If you look out two years, it's actually going to start to be something that's really contributing. We actually have operating profits in this business. It's not just kind of a holding company." We're not there yet, but we can see a path to get there, but it's a few years out. The other piece of the business that we have to do some work on is to explain how we make money on the seed capital itself, because there it's a mixed bag. If you think about it, we've got some seed capital in the private credit funds that Sagard is running. There you've got a running yield on those. You could explain the profits pretty easily. We've got investments in some energy infrastructure where you're making capital investments, from a P&L point of view, you've got a lot of amortization, a lot of depreciation, I should say, they really should be valued on a cash basis, not an earnings basis. Private equity, where you've got kind of lumpy returns based upon when there's a disposition. We've got a mixed bag in the seed capital, but we think we actually have quite attractive returns we can earn there. That's, I think, in addition to whether we're making money as a GP, as a manager, we've got more work in the upcoming year to lay out to all of you how we think about profit from the seed as well. Then we roll it all up together into, this is what the business is producing for Power. Sorry for the long answer. That's my perspectives on when we get to profitability and how we communicate it. Yeah. Thank you. That's great detail and thought. Second question was on the growth in China, and it seems you're bringing capital in through the Power Pacific channel and also China AMC is obviously doing very well. Is that the extent of the strategy for Power Corp in China, or are there other avenues that you could be looking to add in terms of growing your AUM base in China? Yeah, I think on the ChinaAMC side, starting with that, you're starting to see some really good cooperation. Well, it's actually been cooperation for a number of years, but you're starting to see some good results of Mackenzie launching products into Canada, Mackenzie actually managing some money for ChinaAMC. You've got some two-way flows there that are starting to happen. Power Corp and our alternative management strategies, what are the opportunities for distribution cooperating with either ChinaAMC or with the group that owns ChinaAMC, which is CITIC? I think those are all things that we would like to explore. You're right on point. I think there's broader relationships there that we can explore that would be within the same kind of, the over word term, ecosystem of companies over there that we partner with. China Pacific itself, really great long-term track record. We're trying to raise capital. We've been successful here in the U.S. We're also talking to our partners in China about how we can expand the distribution. There's some early success there. You're quite right. We're looking at how we can expand our distribution footprint using our partners there. Hopefully we have some things we can talk about, but I wouldn't say anything too tangible at this point, but we are focused on that. I don't know if that answers your question. Yeah. Thank you. Okay. Thank you. Your next question is from the line of Tom MacKinnon from BMO Capital. Yeah. Thanks very much. Good morning, Jeff and Greg. A quick numbers question and then some follow-ups. Just with respect to the ownership in GP Strategies and the ownership in the SPAC. In terms of the fair values at June 30th, are those CAD 93 for the GP Strategies and $240 million for the SPAC? Are those values around the same values when you show your NAV on page nine? While you're looking up that, I'm wondering, when you show that NAV on page nine, you talk about publicly traded companies, but you actually have significant ownership in three others, albeit smaller. One is Lion, one is the SPAC, and one is the GP Strategies stock now as well. I'm wondering why you don't separate those out when you do your NAV on page nine. I'm going to have a follow-up. Thanks. Okay. Thanks. Good morning, Tom. I'll pass it over to Greg on what's in the number. I think it's yes for GP and no for the SPAC because it's not our capital. Greg, why don't you take on those questions and then I think they're actually all for you. Yeah. Unfortunately, I am going to have to ask you to ask your follow-up question again, Tom. With respect to GP Strategies, you quoted the August 6th number. The June 30th number's a little lower. I think my recollection is 76 is the amount for June. I will have someone check that and let us know if that's exactly right. As Jeff said, the SPAC is not in that number. We have a very de minimis amount of money that we put into the SPAC. It's not shown on the net asset value. Third party, in effect. Yeah. Third party funded it. That's it. That's right. Tom, your second question or second series of questions? Oh, yeah. I guess why don't you take your ownership in Lion out of that NAV that you show on page nine and put it in the publicly traded companies line? Lion is one of the standalone companies. It's not one of our publicly traded companies. It is marked to market on a regular basis. That's the distinction when we do the presentations, Tom, is to show basically what are the strategic core assets which are the operating companies that are publicly traded there, and then make the distinction between those and the standalone so that you can understand how we look at it going forward. Tom, let me say it another way. If your question's about value disclosure, you get it on 22. Okay? With your question noted about whether GP Strategies, that's an August 6th number. There is a timing difference. That was your question. Basically, if they're public, we've disclosed the numbers right there. The real difference, though, is that the standalone businesses we've been pretty clear are while they're great businesses, they're really businesses that we would intend to not have within the portfolio if you look out several years. I'm not going to repeat my answer to Nik as to when we would do that. They're really not financial services, and we're going to build a business that's going to be financial services around the alternative asset management businesses, and they're not part of that. The three businesses at the top, which are the core, Great-West Lifeco, IGM, and GBL, those are on strategy. That's why they're separated out. Exactly. That's why they're separated. Okay. Thanks. Just in terms of the increase in the fundraising at Sagard, what would you attribute that to? We've had a stronger private equity market. You've got broadened mandates here. Do you expect this trend to continue here? It has been a pretty good market for private equity, but what makes Sagard a little bit more unique here in terms of its ability to do some fundraising versus sort of the broader private equity market? Yeah. A good track record and a very good track record. If you go to Portage has had funds one and two have produced great returns. They were able to continue to raise money, and the SPAC was basically that as well. It's based on the team that's been put together and the fundraising machine that goes around it. Same thing with Credit Partners. That's a team that has produced very good returns, so they've been very successful at raising additional capital. The track record at Sagard Europe, it's a 20-year track record, maybe even longer. No, it goes back to about 2000, 2001. I can't remember exactly the date. They had good success there because they've got a good long-term track record. It's about track record and focus on fundraising. The royalties team is good. That's a newer strategy. It's as simple as that. You've got it on both fronts. They're producing good returns for their investors, and they're very good at reaching out and doing fundraising. All right. Okay. Thanks so much. Simple as that. Yeah. Okay. Thanks, Tom. Your next question is from the line of Doug Young from Desjardins. Your line is now open. Hi. Good morning. First question on the standalone businesses. I guess two questions from the standalone businesses. On the GP Strategies, you sold it as you talked about. Have you or could you quantify the gain that you're anticipating in Q4 from that transaction? The second question on the standalone is the ownership in Lion increased to 35.7%, and I think it was 31% before. I would have expected it to go the other way, but there may be some nuances there that I'm not catching. Just hoping to get some color on that, and then I got a follow-up. All right. I'm going to hand it over to Greg. GP Strategies, we did not sell it yet. It will be sold. Well, the transaction closes, I think, in the fourth quarter. We're just reflecting, quite frankly, the reversal of the previous impairment, actually, on that particular property. The gain, off the top of my head, I think is something like CAD 33 million that's in there in the quarter. Your question about Lion, and it actually did not increase. I'm not sure what you're referencing. It is 35.7. That's what our interest is right now. That was after, obviously, the merger with Northern Genesis, and there was a dilution at that point in time. I'm not sure. Let me jump in, Greg. We may not get to the bottom of it on the call, Lion, pre-SPAC merger, we owned equity, and we owned an option to buy more. The SPAC and the merger with Northern Genesis in and of itself was dilutive to our position. Then the option that we had became subject of a negotiation as part of the SPAC. It was exercised. When all of that comes out, you get to our equity position. To follow through those steps, like kind of do a reconciliation, I don't have that in my head. There were three moving pieces you need to be aware of. The 31- Okay. Yeah. That we should go back off the call and kind of piece our way through. Those are the moving pieces. Yeah. We'll go off the call. Yeah. I. Sorry, Doug. I was just going to add that you're probably referencing the 31 before the options were exercised- Yeah. Thanks, Greg The options take us back to CAD 35. Yeah. That's it. Sorry, Doug, I aimed it on. No worries. I was going to say I blame it on my summer brain. Yeah, we can follow up offline. Second, just on the cash balances, and again, maybe you can correct me if I'm wrong, I would have expected the cash balances to increase a little bit more. That does include the cash proceeds you got from Wealthsimple. There was, in the non-consolidated cash flow statement, there's investment activities where there's an outflow of CAD 271 million. I'm just hoping you can maybe quickly flush out if there's anything unusual on just the movements in and out of the cash side. The second part of that is just I know you talked a bit about buybacks and the three criteria. Jeff, is it really like you have to wait for OSFI's restrictions to come off, is that like for Great-West, before you really are going to get more aggressive on the buybacks? Just hoping, is that the one criteria that has to kind of happen first before you're comfortable with that? Thanks. It's a great question. It's funny, you could be sitting in our meeting rooms, Doug. I think on the dividend, the answer is yes. On the buybacks, we're discussing that. It's a good question. Maybe not on the buybacks. We haven't made any decisions there, but we're asking that very same question to ourselves. Did you want to go on the cash flow, Greg, in terms of- Yeah, sure, Doug. Doug, the cash flows, there is nothing unusual in the cash flows, and it does reflect our proceeds from Wealthsimple. I think it was CAD 187 was our total, but we did not receive all that in this particular quarter. We will be receiving some of that in future quarters, just for tax planning reasons. The outflows would just be normal funding activity to the platforms, being the Power Sustainable and also to Sagard. That is what the outflows would have represented. Just to find a point. It looks like a seed investments out to your investment platforms and/or normal cash flows out to your investment platforms could be including seed. On the buyback and the dividend increase, yes, you got to wait for OSFI's restrictions to come off, and I kind of get that. Buybacks, it's unclear whether you have to or not, and you're kind of bouncing that around. Yeah. Our dividend is a flow-through, is a pass-through. Sure. Without the subs increasing, without Great-West or the subs increasing dividends, we're not going to increase the dividends, would be our current position. The buyback is less clear about that. I don't want to leave anyone with the impression that we're going to get ahead of OSFI. We have not made any decisions on it, just to be perfectly clear. The answer to your specific question, we don't have to wait. That's something we can consider. We haven't made any decisions on it, so I don't want anyone getting ahead of themselves thinking that we're about to do that. It's not as hard and fast a rule. It's more of a judgment call. That's all. Got it. Thank you. Thanks, Doug. Your last question is from the line of Geoffrey Kwan from RBC Capital Markets. Your line is now open. Morning. Just had one question. Recognizing Great-West has the Prudential deal on its hands, but just wondering if you can talk about, just generally speaking, where you see the opportunities for acquisitions and/or divestitures within Great-West and IGM. Hi, Geoff. Good morning. It's a good question. The Great-West Lifeco itself, the Empower team, obviously they've announced three transactions. From a human point of view and a resource point of view, they're very focused on getting those done. We're very confident they're making great progress on both Mass and on Personal Capital, and really nicely sequenced with the way the Pru deal will work in terms of how it falls in, but they're occupied, clearly. Across the rest of Great-West Lifeco and IGM and their management teams, they don't have the same level of M&A integration activity going on. A little bit at Irish Life with the deal they've announced. Lots of human capacity across the group. From a financial capacity point of view, clearly Great-West Lifeco has got its leverage ratio to the point where it's not sitting there able to go out and do a leverage transaction if an attractive financing or attractive M&A opportunity came along. The philosophy we follow is we're going to look at opportunities in all of our businesses, and they tend to take a long term to come to fruition once you're on them. If we have an attractive deal, we'll figure out a way to finance it if it's attractive. We're not stopping on any business front at Great-West Lifeco or at IGM to look for opportunities. Recognizing the Empower team itself is occupied for the foreseeable future. Commenting on specific areas where you might see something is always difficult to do. Every business starts by saying we've got an organic strategy to pursue, that we're going to be active, if an opportunity comes by, we'll pursue it. The kind of deals where we would be focused on are ones where we can do two things, build out the strategic position of the company that we have so it's stronger in their market, more relevant to clients, more scale, and at the same time, drive some synergies, both cost and revenue. We continue to be active in the asset management space because that's a space, as you would know, that is one where we could benefit from more scale. Plan A is always just improve the business that we have right now. If you go into Great-West Lifeco, you've seen activity in Ireland. We're always looking across the European platforms. Are there ways we can enhance our businesses there? IGM itself, I think James O'Sullivan has been speaking about it recently. What can we do in the Canadian wealth management space? Again, what can we do in the asset management space? It's hard to pin it down because we internally will be rotating from we're in this business, what's an opportunity there? All across the businesses, we are actively looking at how we can enhance the position. The one where I think people have always thought, in our own verbiage, we've said, well, in Great-West Lifeco Canada, we're already a big player. There's not a lot of opportunities. Great-West Lifeco in Canada itself, through Canada Life, is looking maybe not at big dollar acquisitions, but in enhancing the capabilities they have in their platform. The TPA acquisition that you saw was a way to position Canada Life in the group health benefits market by participating in part of the channel that's growing. It wasn't a big dollar outlay, but it has a strategic value to it. The same way that a few years back, they bought Financial Horizons on the distribution side with individual advisors, have bought up one of the big MGAs. Even for Canada Life, even though they have a big part of the market, there's still things from an M&A point of view that enhance their capabilities. It's a bit of a rambling answer, Jeff, but that's what it is. It's across the board that we're looking at all times. Okay, great. Thank you. Okay, thank you. There are no further questions, presenters. Please continue. Okay. Well, thank you, operator. Again, I'll just finish the way we started. Thank you everyone for being part of the call. We're really excited about what has gone on since we last met and looking forward to continuing with our foot on the gas pedal here and to reporting more good progress as we speak to you in the upcoming quarters. I wish you all a good day and a good week. Operator, thank you very much. That's it for the conference call. Thank you. With that, this concludes today's conference call. Thank you for attending. You may now disconnect.