CI Financial's Unsolicited, Hostile Bid

CI Financial announced yesterday an unsolicited hostile offer to acquire all of DundeeWealth Inc for $20.25 per Dundee share. This offer follows the news last week that Dundee Wealth had reached a deal with Scotia Bank to sell Dundee Bank for $260 million and 18% of Dundee Wealth for $348 million (27.3 million shares at $12.76 each). Scotia’s offer represents a 5% premium to Dundee’s share while CI’s offer represents a 52% premium.

Not all CI’s bids were successful in the past. Let’s look at both successful and unsuccessful bids.

Successful Bids

CI bought the followings in the past:

1999 - BPI Financial Corporation

2002 - Spectrum Investment Management Limited

Clarica Diversico Ltd.

2003 - Assante Corporation

Synergy Asset Management Inc.

Skylon Capital Corp.

2004 - IQON Financial Management Inc.

Synera Financial Services Inc.

2007 - Rockwater Capital Corporation

Unsuccessful Bids

2000 - Mackenzie Financial Corporation

2005 - Clarington Corp.


The major shareholder of Dundee Wealth is Dundee Corporation. Dundee Corporation owns 55% of the outstanding shares. Ned Goodman and his family created and still operate and control Dundee. It is unlikely that they would give up full control of Dundee Wealth (to CI) but they seem to be comfortable giving up 18% control to Scotia. I will be surprised if this bid turns out to be a successful bid for CI. Whether this bid becomes successful or not, one thing readers can be assured of is that this will not be the last bid attempted by CI Financial as CI has a history of making hostile (and friendly) bids for financial companies.

First Published: Sep 26, 2007