Dundee to corral Cartier for $123.4 million

(November 11, 2003) After months of speculation, the whispering ceased today with the announcement that Dundee Wealth Management has entered into a definitive agreement to purchase Cartier Partners Financial Group.

Under terms of the agreement, Dundee will purchase all the common shares of Cartier for $123.4 million, representing $95.2 million in cash and 3.737 million common shares.

Upon completion of this transaction, Dundee will have over $36 billion in assets under management and administration, with Cartier accounting for approximately $16 billion of these assets. Dundee will also boast a network of more than 3,800 independent financial and insurance advisors in over 350 branches across Canada.

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“This is a very exciting transaction. It brings together two companies with a very similar vision to create the large independent financial advisory network in Canada,” said Dundee Wealth president Ned Goodman in a conference call.

There are no immediate plans to cut Cartier’s advisor force, said Dundee Wealth vice president Don Charter. “We believe Cartier has a very stable network of financial advisors,” he said. “Dundee has had a very stable and growing group of advisors. We believe we will have strong advisor retention based on the track records of both companies.”

“When we look at what Dundee brings to the he table, we believe our advisors will be extremely excited by this transaction,” added Cartier chair Jean Dumont, who will join the Dundee board when the transaction is complete.

Cartier president Dan Richards says he believes the agreement could attract some new advisors to the company. “It’s our expectation that some of those folks who were attracted by Cartier’s independent philosophy will see Dundee as a similarly attractive proposition and will make the move over.”

Independent fund industry analyst Dan Hallett says the Dundee/Cartier combination makes sense, considering both companies are publicly traded and count many advisors as shareholders.

“In the context of corporate culture, and what I know of the respective firms, it’s a good fit,” Hallett said.

Dundee also announced that it would immediately establish an “integration committee” comprised of management representatives from both companies, including Richards. The committee will be chaired by Charter. “Collectively, we should be capable of making this a successful addition to our growth plan,” he said.

The official offer is expected to be mailed within two weeks to Cartier shareholders, subject to the “satisfaction of certain conditions.” Once mailed, the offer will be open for a minimum of 35 days, unless withdrawn or extended. Under certain circumstances, a break-up fee of $5 million is payable by Cartier if it accepts a competing offer.

Cartier is hosting a special conference call Wednesday morning to explain the deal to its advisor force.

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(11/11/03)