Toronto-based mutual fund firm AGF Management has announced plans to purchase Acuity Investment Management for $325 million.
There are no immediate plans to change Acuity’s portfolio management team or its fund lineup, which includes several SRI funds: Acuity Social Values Canadian Equity Fund, Acuity Social Values Global Equity Fund and Acuity Social Values Balanced Fund (formerly the Acuity Clean Environment Balanced Fund).
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. The acquisition requires regulatory approval, AGF said in a news release, and is expected to close in the first quarter of 2011.
AGF is one of the largest independent investment management firms in the country with assets under management of $44 billion increasing to more than $51 billion as a result of today’s announced acquisition.
"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 a statement. "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 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.
In a conference call, Blake Goldring, the Chairman and CEO of AGF, indicated that Acuity’s strong institutional base, Canadian equity expertise and complementary products including Socially Responsible Investments, were attractive to AGF.
ReplyDeleteUnfortunately, the SRI community’s experience with Royal Bank, IA Clarington and Mackenzie suggests that while the Social Values Funds will survive, they are unlikely to thrive as part of a large traditional mutual fund company. Prove us wrong, AGF!
Sucheta, I'm curious to know more about what the "SRI community’s experience with Royal Bank, IA Clarington and Mackenzie" has been?
ReplyDeleteIs it a performance issue? Weaker SRI screening?
It would be great to know more, perhaps even a post about the issue?
Thanks!