EDC, BDC merger seeks to foster corporate champions with global footprints

Résumé détaillé

Combining the federal financing agencies will concentrate resources of Crown corporations

The planned merger of Export Development Canada and the Business Development Bank of Canada amounts to a bet that, with the right size and focus, it will be possible to nurture into life a new generation of something this country has long sought: domestic corporate champions that conquer industries across borders.

“It’s about the number of Canadian companies of a certain size that have a genuine footprint in multiple markets,” Alison Nankivell, chief executive officer of EDC, said in an interview this week.

EDC and BDC are both Crown corporations that offer support and financing to businesses.

Ottawa plans to merge federal financing agencies, set up standalone sovereign wealth fund

Together, they have $128-billion in assets, 5,100 employees and a footprint in more than two dozen countries. The mandate to combine them is among the steps Ottawa promised in the federal budget unveiled earlier this month.

The name of the new entity is not yet clear. Nor is its leadership. Nor is the date it will enter into existence.

But the idea is not novel. Canada is following in the footsteps of countries such as France, Japan and even China, concentrating government-backed financial resources in an effort to bolster the economy.

“The model of how we create prosperity going forward is a lot harder and more complex,” Ms. Nankivell said. “So it actually needs a much more focused development bank to do that work.”

The combined entity will be placed under the responsibility of the Minister of Finance, according to two people with knowledge of the plans, part of a broader bid to consolidate federally backed financing agencies. The Globe is not identifying the two sources as they were not authorized to speak publicly on the matter.

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