Jacques Poitras of the CBC reports N.B. pension fund managers accused of costing tech investors millions:

The company that manages billions of dollars in pension funds for thousands of New Brunswick public sector employees and retirees is being accused of causing financial losses for hundreds of investors across Canada.

Fredericton-based Vestcor Inc. and one of its senior executives are the targets of a petition filed in British Columbia that is seeking court approval for a class-action lawsuit.

The company is accused of falsely inflating the value of a corporate merger between two technology companies.

Vestcor invests the pension contributions of New Brunswick civil servants and other public sector employees in various investment vehicles, including stocks.

According to the petition application, Vestcor was the majority shareholder in Exro Technologies, and “orchestrated and significantly influenced” Exro’s 2024 merger with SEA Electric Inc., in which Vestcor also owned shares.

Exro paid $300 million to acquire SEA Electric after telling its shareholders that SEA would make $200 million in profits in 2024 — a figure that proved “delusional,” the court filing says.

“These facts and circumstances reflected within those representations were the basis of the grossly inflated valuation assigned to SEA Electric,” it says.

“Those purported facts and circumstances did not exist, or the manner of their representation in the material change report was false or misleading.”

It alleges Vestcor and its vice-president of equities Mark Holleran “did so in order to manage, or salvage, their significant investment in SEA Electric.”

The assertions in the petition have not been proven in court and Vestcor has yet to file a response.

“Our legal team is currently evaluating the merits of this lawsuit,” CEO Sean Hewitt said in an emailed statement.

“The claims have not been tested in court,” he added. “We have no reason to believe in their veracity.”

Sage Nematollahi, the lawyer who filed the petition on behalf of two shareholders, told CBC News that Vestcor “has lost a lot of money” as Exro’s majority shareholder, tying up “significant funds from pensioners in New Brunswick [with] this investment that has not done great.” 

But in Hewitt's statement, he said the impact was “negligible” to the overall performance of Vestcor’s investment portfolios, estimating it at a fraction of one per cent of the total.

“Given the robust funded positions of our clients’ pension plans, and continued strong investment performance, there is no impact to the monthly income of pensioners,” he said.

The company managed a total of $23 billion in 2024 — an increase of $2 billion over 2023.

Vestcor, owned by the province’s two largest pension plans for civil servants and teachers, was created in 2016, replacing a government-owned agency.

It handles retirement plans for hospital workers, nurses, Crown corporation employees, provincial court judges, MLAs and others. It also manages other investment funds, including the University of New Brunswick’s endowment. 

Exro was delisted by the Toronto Stock Exchange in October.

The company revealed in November 2024 that its revenue projections would fall far short of what it had claimed, recording a loss of $226 million, including a $211 million loss to the value of SEA Electric’s assets.

The losses led to “the complete collapse” of Exro, the filing says.

The petition alleges that Vestcor and Holleran “acted in bad faith and/or conflicts of interest” as “de facto directors and/or officers” of Exro.

The petition was filed by two shareholders, British Columbia resident Bryan Irwin, who held  27,500 common shares worth $22,000 at the time of the merger, and Ontario investor Mike Zienchuk, who had 900,000 shares worth an amount not disclosed in the court filing.

Nematollahi told CBC News that about 500 other shareholders have contacted his office about joining the lawsuit if it is certified as a class action case.

“There could be thousands of shareholders out there,” he said.

Zienchuk and another investor, Allan Crosier, have also filed a lawsuit in Alberta against Exro, two former company officials, the company’s financial advisors and its insurance underwriters.

Exro billed itself as a clean tech company that would design and build power electronics to improve the efficiency and cost-effectiveness of electric vehicles and energy storage systems. 

Vestcor was a majority shareholder in Exro at the time of the merger and also held 14.3 per cent of preferred stock in SEA, meaning Vestcor was “acting both as a seller and a buyer,” the filing says. 

I read this earlier this week and to be honest, I didn't contact Jon Spinney, CIO at Vestcor who I know because the allegations in the article are absurd.

What do I mean? Vestcor "orchestrated" Exro Technologies'  buyout of SEA Electric Inc to save it on its book? It just seems like such nonsense. 

The only thing leading to this accusation was this:

Vestcor was a majority shareholder in Exro at the time of the merger and also held 14.3 per cent of preferred stock in SEA, meaning Vestcor was “acting both as a seller and a buyer,” the filing says.  

To which I say so what? It's not like Vescro forced Exro to merge with SEA.

But this is the part that really caught my BS detector:

Sage Nematollahi, the lawyer who filed the petition on behalf of two shareholders, told CBC News that Vestcor “has lost a lot of money” as Exro’s majority shareholder, tying up “significant funds from pensioners in New Brunswick [with] this investment that has not done great.” 

But in Hewitt's statement, he said the impact was “negligible” to the overall performance of Vestcor’s investment portfolios, estimating it at a fraction of one per cent of the total.

“Given the robust funded positions of our clients’ pension plans, and continued strong investment performance, there is no impact to the monthly income of pensioners,” he said. 

I categorically refute claims that Vestcor is losing or has lost a lot of money. Complete and utter nonsense!

Back in April,  I went over Vestcor's solid 2024 results with CIO Jon Spinney and they were truly excellent on all fronts. You can read that comment here.

Moreover, as CEO Sean Hewitt notes, the loss from Exro's implosion was negligible so this story is much ado about nothing.

Basically, Sage Nematollahi (featured above), the lawyer representing plaintiffs used some contacts of his at CBC to make a big stink about Exro's implosion trying to tie it to Vestcor, making all sorts of unfounded and in some cases completely false accusations.

These lawyers are a dime a dozen in the securities field, typically they make all the money and recover little to no funds for their clients who subscribe to a class action lawsuit after a stock collapses.

Anyways, Vestcor will fight these allegations in court and if they are proven guilty of any wrongdoing, I will let my readers know.

I think this article is a bunch of nonsense that Jacques Poitras of the CBC got suckered into reporting (warning to all reporters, if unsure, before publishing contact yours truly, I will set the record straight).

More importantly, I want civil servants and teachers in New Brunswick to know that Vescor is doing an excellent job managing the assets of their pension plans.

Don't let this negative CBC article lead you to conclude otherwise.

Below, learn more about Vestcor and what it does. It's the most important pension fund in that region of the country and they are doing great work in my opinion. 

Also, Keystone Financial made a clip on whether Exro has a chance at recovery. Take the time to watch this, he covers all the details well.

On Tuesday, OMERS Private Equity announced the sale of CBI Health’s home care business to Extendicare:

• Transaction delivers value to OMERS members and positions company for expanded patient care

Toronto — OMERS Private Equity is pleased to announce that Paramed Inc. , a wholly-owned subsidiary of Extendicare Inc. (TSX: EXE) has signed an agreement to acquire CBI Health LP’s (“CBI Health”) home care business, which operates under CBI Home Health LP (“CBI Home Health”). The closing of the transaction is expected to be completed in the first quarter of 2026 pending final regulatory and related approvals.

Since its acquisition of CBI Health in 2011, OMERS Private Equity has worked closely with the leadership team to grow the company into one of the largest providers of integrated health care services, including physiotherapy, rehabilitation services and home care services.

CBI Home Health, the company’s home care division, has also experienced remarkable growth, expanding its team from 1,800 employees to 8,500 and delivering over 10 million hours of care annually across seven provinces.

“The investment that OMERS made in CBI Health really launched our direct buyout investment efforts almost 15 years ago. This transaction marks a successful milestone for OMERS Private Equity with a strong realization enabled by expanded patient care and clinical excellence.” said Mark Van Wart, Managing Director and Head of Healthcare, OMERS Private Equity. “CBI Health formed the basis of a 15-year successful track record in healthcare investing. We continue to look for ways to support CBI Health’s ongoing growth and delivery of high-quality healthcare outcomes for patients across Canada.”

OMERS will remain a majority owner of CBI Health, supporting ongoing growth, innovation and excellence in the physiotherapy and rehabilitation services sector.

“As CBI Health moves into the future, we are fortunate to have built a strong partnership with OMERS over the last 15 years and we are thankful that partnership will be continuing,” said Jon Hantho, CEO of CBI Health. “The sale of our home care business provides meaningful capital to support the ambitious growth plans we have in physiotherapy and rehabilitation services that is grounded in clinical excellence, exceptional client experience and the best team members.”

“OMERS Private Equity is unwavering in our commitment to delivering meaningful value and upholding the pension promise for our more than 640,000 plan members,” said Alexander Fraser, Executive Vice President & Global Head of Private Equity at OMERS. “Our collaboration with the exceptional leadership team at CBI Health demonstrates our intentional investment in enhanced healthcare services, coverage and outcomes in Canada. Extendicare is well positioned to continue the service excellence at CBI Home Health.” 

When I first read the press release, I was confused as to why OMERS will remain majority owner of CBI Health but Don Peat of OMERS clarified it in an email exchange (my bad):

Extendicare purchased CBI Health LP’s (“CBI Health”) home care business, which operates under CBI Home Health LP (“CBI Home Health”). As the release says, OMERS will remain a majority owner of CBI Health, supporting ongoing growth, innovation and excellence in the physiotherapy and rehabilitation services sector.

So there's CBI Health and CBI Home Health.

Makes sense, Extendicare is in the home care business so they carved that out of CBI Home Health from CBI Health's other services.

For its part, Extendicare announced this deal on its website on November 19th, stating it will expand its home health care business by acquiring CBI Home Health for $570 million in cash consideration.

OMERS Private Equity acquired Toronto-based CBI Health Group from private equity firm Callisto Capital LP back in 2011.

At the time, the terms of the acquisition were not disclosed but if you read the press release carefully, this stands out:

CBI Home Health, the company’s home care division, has also experienced remarkable growth, expanding its team from 1,800 employees to 8,500 and delivering over 10 million hours of care annually across seven provinces. 

So, carving out CBI Home Health and selling it to Extendicare for $517 million was a great way to realize value on this deal.

OMERS PE did its job to nurture and help grow the operations at CBI Health which it still owns (the physiotherapy and rehabilitation services sector) and realized great value for its members on this distribution.

This is also a great acquisition for Extenidcare and it will help solidify the company as Canada's leader in the home care business.

Interestingly, shares of Extendicare continue to make and all-time high, rallying on strong fundamentals:

 I agree with analyst Douglas Loe, there's a lot to love about this company. 

Alright, let me wrap it up there. 

Below, learn more about CBI Health and what sets this company apart.

The Globe and Mail published an article from GTA's Top Employers on how UPP is focused on building an intentional culture:

Most veteran employees have clocked decades with their company. For Nirupa Muthurajah, it’s only taken three years to earn that title at the University Pension Plan Ontario (UPP), Canada’s newest defined benefit pension.

When the fund offered her a job in 2022, Muthurajah says it was an easy yes. After a decade in institutional investing at two large Canadian “Maple Eight” pensions and a local family office, she found that UPP’s mission to provide retirement security for university-sector employees resonated with her. Plus, she was getting in on the ground floor.

“What excited me most was the chance to make an impact at the ground level and shape the foundational framework from the very beginning,” said Muthurajah, UPP’s director and equity strategies lead for active public markets.

Part of laying the foundation is building an “intentional” culture, says Omo Akintan, chief people officer. “No organization sets out to be a toxic work environment; they fall into it. UPP realized that you have to define your North Star from a culture perspective and intentionally build programs and develop leaders that can help produce that culture,” she says.

The organization fosters a “learning mindset,” with an up to $5,000 education assistance fund, and is rolling out formalized development plans for each employee. “We encourage dialogue between people and their leaders about what they need to be successful in their roles and where they aspire to take their careers,” Akintan says.

It also sees equity, diversity, inclusion and reconciliation (EDIR) as critical components of its culture. “At UPP, we call out reconciliation intentionally and are being particularly attentive to the Truth and Reconciliation Commission call to action that asks organizations to educate their employees about the rights and history of Indigenous People.”

One way UPP is bringing that to life is through UPP Reads. In 2023, all employees read “21 Things You May Not Know About The Indian Act” by author Bob Joseph and discussed it in peer-facilitated groups. Now, it’s a part of onboarding: once there’s a big enough cohort of new hires, they’re all given a copy and participate in a discussion group afterward.

It has also hosted organization-wide learning around inclusive workplaces and now has an online curriculum of EDIR learning opportunities that employees can choose from on topics such as psychological safety, trans identities, ability rights and other equity-deserving populations.

“This unique education is really supporting us to broaden our perspective and helping us become more aware of marginalized communities and the importance of diversity,” Muthurajah says. “From an investment perspective, it’s valuable for us to be aware of since it’s a priority both in our decision-making and in our hiring practices.”

Muthurajah says she’s benefited from UPP’s support for professional development. Since starting at the pension, focused on active long-only strategies — the active selection of stocks to buy and hold — her role has broadened out to include all equity strategies, including co-managing the pension’s hedge fund portfolio.

She credits the organization for its strong focus on work-life balance. UPP only requires two days per week in-office and offers employees a bank of personal and mental-health days. It even shows up in small gestures, such as a general effort not to ping people after hours or on the weekends, and starting all internal meetings at five minutes past the hour to give people a moment between calls.

“We’re recognizing that people might feel overloaded when a lot of investments are going through, so it’s great to have a recharge day to slow down,” she says. “UPP makes thoughtful effort to support a growing organization, and they’re appreciated as a member of the team.”

I'll give you my quick thoughts but first a little background:

Now in its 20th year, Greater Toronto's Top Employers is an editorial competition that recognizes the employers that lead their industries in offering exceptional places to work. Each year, the project’s editors release detailed reasons for selection explaining why each of the winners is chosen. This provides transparency in the selection of winners and lets readers discover best practices among the region's top employers. Winners are announced annually in a special magazine, distributed online in The Globe and Mail. Any employer, private or public sector, with its head office or principal place of business in Canada may apply to the competition. For more background on this year's competition, read the press release issued on Dec. 2, 2025.    

Alright, now my thoughts and I am going to be honest here even if some people disagree with me (after almost 20 years of blogging on Canada's pensions, I've earned the right to tell it like it is, or like I see it and don't need people's approval).

First, on UPP. It commenced operations in the midst of the pandemic and I truly believe that helped shape the culture there as it wasn't an easy time.

From the get-go, CEO Barb Zvan stressed the importance of respect and she set the tone at the top and it has permeated all the way down the chain of command.

And when I say respect, I mean respect in all its forms, respect for differences of opinion, respect for difference of thought, and respect for all diversity.

Barb has enough experience to know that any organization is only as good as its members and  UPP has done a great job attracting top talent because of Barb, senior staff and the culture they have implemented there.

It doesn't surprise me she was recently named the 2025 CEO of the Year by the Ontario Chamber of Commerce (OCC) as part of its annual Ontario Business Achievement Awards (OBAAs), which celebrate leadership, innovation, and impact across Ontario’s business community. 

To be truthful, however, UPP can't compete with Canada's Maple 8 in terms of compensation because they are too small on a relative basis, so they compete in terms of having the right culture which typically attracts the right employees who value the same things.

Not that UPP's compensation isn't competitive, it definitely is at all levels, it's just not as competitive as much larger organizations but it's still excellent and money isn't everything when employees feel respected and valued and see a clear career path forward.

The biggest mistake some of the bigger pension funds do is remind everyone how well paid they are and then put the pressure on them to perform without creating the right culture to bring out the very best from all their employees.

I can't stress this enough, big compensation with the wrong culture is a formula for organizational failure. I've personally seen it many times at various places I've worked and others have worked.

And building the right culture is really hard, it's a lot more than claiming you follow equity, diversity, inclusion and reconciliation (EDIR) and read about indigenous history and other marginalized groups, it's about confronting your own personal biases and really taking a critical look at your organization and seeing who is in charge and whether they have the right leadership skills including empathy to build the right culture in their department. 

I can't stress this enough, too many organizations fall into the trap of window dressing, bean counting, we have this many women at this level, this many from this minority group or that minority group, but do we really have the right leaders in place in all departments and how do we measure their success at building the right culture? 

Admittedly, it's not easy, it involves asking employees at all levels to evaluate their bosses and give truthful feedback, good and bad. 

Moreover, I'll be the first to say in this hyper-sensitive, hyper-woke world, it's easy to get lost in the weeds and feel overwhelmed if you are managing a diverse team and need to strike the right balance to get the most out of your employees.

Communication, empathy and honesty are critical leadership skills and that involves being honest with yourself and your own biases.

In terms of honestly, I cannot stress enough the most marginalized group in Canada's labour force remains people with disabilities and not much is being done at public or private organizations to address this in a meaningful way.

Ask yourself when is the last time you saw someone in a wheelchair at your organization, a blind or deaf person, a schizophrenic or someone with a chronic disease struggling to make ends meet?

These are uncomfortable questions but the test of a fair and equal society is how it treats it's most vulnerable citizens: children, elderly and people with physical and mental disabilities.

I once had a CEO of a major Canadian pension fund ask me how to attract more people with disabilities. 

I asked him straight out: what are you guys doing to attract them, is your organization ready to assume this responsibility? He admitted me to me  that he honestly doesn't know but it nagged at him and wanted to do something about it (he never did as far as I can tell but at least he was concerned).

Alright, let me wrap it up there, just remember culture is like governance, it takes a lot of work and constantly needs to be evaluated and improved every year. And that takes a lot of work, hard work.

Below, a well-known older clip where Simon Sinek explores empathy and perspective in leadership. If you've never seen it, take the time to watch it, he offers great perspective to all leaders. 

Last week, I had a Teams meeting with Rhynhardt Roodt, Ninety One's head of the 4Factor investment team and co-portfolio manager of the Global Equity and Global Strategic Equity strategies.

Rhynhardt was in Winnipeg visiting clients and I had a chance to talk markets with him and get into their strategy. 

I want to thank Ninety One's Jeannie Dumas for setting up the meeting as well as Katherine Tweedie who co-heads the North America Institutional Client Group at Ninety One, and participated on the call.

To begin with, Jeannie sent me this in her initial email: 

Rhynhardt is Head of 4Factor at Ninety One, which has just reached its 25 year anniversary as has the Global Equity Strategy, which currently sits at $25.4 billion AUM as at 30 September 2025.  Additionally, I have included a few bullets from his 2026 outlook which he is currently pulling together:

Looking ahead to 2026

• Divergent fiscal and monetary cycles and the durability of the AI investment boom will shape the landscape.
• Increasing non-US exposure and positioning for evolving capital flows will strengthen portfolio resilience and long-term outcomes.
• In Europe, momentum is improving amid fiscal expansion and easing energy costs.
• The UK remains attractively valued, offering opportunities in materials and financials.
• Japan continues steady progress on wage gains, governance reforms, and currency support.
• EM’s seem to have turned a corner, with profit margins recovering and valuations attractive versus developed markets
• Persistent macro volatility, structural shifts, and changing currency dynamics favour active investors.
• A disciplined approach—blending data-driven analysis with fundamental insight—is uncovering opportunities in technology industrials, and financials.
• Key portfolio holdings – TKO Group, Rheinmetall, Nintendo, Tencent, AI semis (e.g. Nvidia, Broadcom, TSMC). 

Now, you will recall back in June I had a great discussion on emerging markets with Varun Laijawalla, portfolio manager at global investment manager Ninety One where we went in-depth on factors favouring emerging markets. 

I must admit, I am so US-centric in my investment focus that I rarely look at other markets including Canada's or emerging markets. I have a vague idea of what is going on in these markets but I don't get into details for the simple reason that for me the US market is by far the most dominant market in capital markets.

So when I get a chance to talk to experts like Varun or Rhynhardt, I like to see their thinking on markets from their expert vantage point.

Rhynhardt began by going over his background and telling me 4Factor is an approach to equity investing that's been around for 25 years "which is significant in itself because not many track records are 25 years long. That speaks to the consistency and discipline of approach we applied."

Their client base is large pension funds and sovereign wealth funds.

He told me 4Factor is very much a "core, style-agnostic approach to investing," adding they "cast the net wide on 4Factor"on four style factors -- quality, value, operating performance and investor attention -- and they are very much agnostic in terms of where they find these opportunities.

[Note: You can read more on 4Factor approach here.] 

Rhynhardt stressed they are very agnostic in terms of where they find those opportunities across regions and sectors.  

"If you look at are portfolio composition over time, it's very different, the alpha we produced pre-GFC and post-GFC came from very different businesses." 

He told me the 4Factor team invests across developed and emerging markets through Global, European, Emerging Market Equity, Asia, International and China strategies. 

They invest across all GIC sectors including financials, REITs, technology, materials, etc. 

He told me at least 2/3 of their tracking error is from stock specific risk so they take very limited risk in terms of sectors or countries. 

All this to say that they don't try to generate alpha through sector allocation and even less o on country allocation. On big sectors, they're pretty much benchmark weighting although on some industries they can be overweight (for example tech).

"If you decompose our alpha over time, the vast majority (90%) comes from stock selection rather than sector allocation." 

Katherine Tweedie jumped in to explain how some Canadian clients have used 4Factor.

For example, one client has been investing in the oldest strategy Asia ex-Japan, "essentially giving them EM exposure with an Asia focus." 

She added: "One of our university clients decided to look at EM from a different lens, allowing existing managers to look at EM ex-China and they look to us for our China expertise to essentially dial up and down their China allocation."

They have other huge mandates in Canada and are backed by big institutions that believe in their approach.

"When I look at the way Canadian clients utilize us, it's very much for this core, all-weather approach whether it's in emerging markets helping to deliver alpha through the cycle in a volatile asset class foe Ems, for China and the same goes for Europe and other regions. When you look across this platform it's very attractive for our clients because we have a very consistent approach to style agnostic through the cycle delivery of alpha whether it be in global, core emerging markets or even down to specialist areas such as China, Europe or Asia. What we typically do is take that core approach and sometimes blend in more concentrated style specific managers to it. Essentially 4Factor is viewed as the style agnostic approach."  

I reverted back to Rhynhardt to talk about markets, concentration risk, the under-performance of active managers and he explained to me how the 4Factor model has been able to generate alpha in an objective way without having biases, for example without being meaningfully overweight AI, they were able to generate alpha.

Anyways, it's getting late, I'm going to have to end it there and once again thank Rhynhardt, Katherine and Jeannie for another stimulating conversation.

Below, Rhynhardt Roodt, global equity portfolio manager at Ninety One, joins BNN Bloomberg to discuss opportunities in developed and emerging markets.