Nov. 30, 2010 (Canada NewsWire Group) --
TORONTO, Nov. 30 /CNW/ - AGF and Acuity today jointly announced that AGF Management Limited has signed a definitive purchase agreement to acquire 100% of Acuity Funds Ltd. and Acuity Investment Management Inc. increasing AGF's total assets under management (AUM) to over $51 billion.
The deal, with a purchase price of $325 million, is expected to be completed on or about February 1, 2011 and is subject to an adjustment based on assets at closing. Under the terms of the agreement, Acuity shareholders will receive a combination of 60 % cash and 40% AGF Class B Non-Voting shares. A portion of the purchase price will be deferred and is subject to an AUM-based adjustment over three years from closing. This acquisition requires regulatory approval.
AGF is one of the largest independent investment management firms in the country with AUM of $44 billion increasing to more than $51 billion as a result of this acquisition. The new asset base will be split almost evenly between retail and institutional assets reflecting AGF's ongoing strategy of diversification and growth. Acuity, a leading Canadian investment management firm, currently manages approximately $7.4 billion for retail, institutional and high net worth investors.
"We are excited about this acquisition which strengthens our position as one of Canada's premier independent investment management firms," said Chairman and CEO Blake C. Goldring. "In this era of consolidation, we have demonstrated our ability to increase scale and we are strongly committed to enhancing our presence at home and internationally as we pursue both organic and strategic growth opportunities."
"We chose to join forces with Acuity because of the firm's impressive track record and long standing commitment to excellence in investment management in both the retail and institutional space," added Goldring.
Goldring went on to add that the acquisition is an excellent fit with AGF's core strengths and strategic priorities and will further diversify the firm's investment management capabilities while leveraging its expertise across multiple channels.
"We are pleased to be joining the AGF family which shares Acuity's values of independence, integrity and innovation. AGF is an established Canadian brand with a truly global reach that shares our entrepreneurial spirit and disciplined approach to investment management," said Acuity Founder, President and CEO Ian O. Ihnatowycz, who is expected to join AGF's Board of Directors after the closing of the transaction.
"As another independent investment management firm with more than 20 years in the industry, we are proud of our successes and are even more excited about the opportunities for growth and synergy by joining AGF," added Ihnatowycz.
The Acuity portfolio management team remains unchanged. The high quality proven investment style, philosophy and process that Acuity clients have come to appreciate remains unchanged. These factors are designed to ensure long term continuity in the management of client mandates. Acuity's investment management team will also be shareholders in AGF with long term incentives and lock-ins to focus on delivering performance for investors.
AGF retail investors will also benefit from having greater choice with the addition of Acuity's strong fixed income and balanced products. These categories are particularly attractive to investors and are garnering high flows in the industry. Institutionally, Acuity's offering of equity, core-plus fixed income, balanced and environmental mandates will also help bolster AGF's strong foothold in this space.
"In making strategic acquisitions, we focus on firms that deliver value for all stakeholders," added Goldring. "We are confident that this deal will further our goal of helping investors succeed in addition to delivering long-term value to our shareholders."
AGF will host a conference call to discuss the transaction today at 11 a.m. ET. The live audio webcast with supporting materials will be available in the Investor Relations section of AGF's website at www.agf.com or at http://bellwebcasting.ca/audience/index.asp?eventid=88863771. Alternatively, the call can be accessed by dialling 1-888-789-9572 (Passcode #: 2322060). A complete archive of this discussion along with supporting materials will be available on the same webcast link as of 5 p.m. ET.
Scotia Capital Inc. is acting as AGF's exclusive financial advisor and Stikeman Elliot LLP is acting as legal advisor to AGF. Cormark Securities Inc. is acting as exclusive financial advisor to Acuity and Borden Ladner Gervais LLP is acting as Acuity's legal advisor.
About AGF Management Limited
AGF Management Limited is one of Canada's premier investment solutions firms with offices across Canada and subsidiaries around the world. AGF's products and services include a diversified family of award-winning mutual funds, AGF Elements portfolios, the Harmony asset management program, services for institutional and private clients, as well as AGF Trust GICs, loans and mortgages. With approximately $44 billion in total assets under management, AGF serves more than one million investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B.
Established in 1990 by Ian O. Ihnatowycz, Acuity now manages $7.4 billion in assets on behalf of retail and institutional investors including pension plans, foundations and endowments. Acuity offers a full range of mutual funds, pooled funds, closed end funds, and wraps (Alpha), as well as separately managed accounts. Acuity has frequently been recognized for outstanding performance across all its investment strategies where the firm has built an enviable long-term track record.
Media, please contact AGF Public Relations and Public Affairs:
Media Relations Manager
AGF Management Limited shareholders and analysts, please contact:
Robert J. Bogart, CPA
Senior Vice-President and Chief Financial Officer
Director, Investor Relations