TSX Symbol: CIX.UN
TORONTO, Feb. 12 /CNW/ - CI Financial Income Fund ("CI") today announced
an agreement under which CI has agreed to make a take-over bid for all of the
outstanding shares of Rockwater Capital Corporation ("Rockwater"), and
Rockwater has agreed to support and facilitate the offer.
The offer will be made at an offer price of $7.65 per Rockwater share.
Rockwater shareholders can choose to be paid, at their election, in (i) cash,
(ii) CI units or, subject to certain limits, exchangeable units of CI's
subsidiary, Canadian International LP (in each case based upon the volume
weighted average closing price of the CI units over the five business days
ending one business day before the expiry of the offer), or (iii) a
combination of the foregoing.
The offer, which is expected to close in late March, 2007, will be
conditional upon a minimum of 66 2/3% of the fully-diluted common shares being
deposited, regulatory approvals and other customary conditions.
Rockwater's board of directors has received a fairness opinion from
Merrill Lynch Canada Inc. stating that the consideration to be received
pursuant to the offer is fair from a financial point of view to all
shareholders of Rockwater and has agreed to support the offer as in the best
interests of shareholders and to recommend that shareholders accept the offer.
Rockwater's directors and officers, representing in aggregate approximately 9%
of Rockwater's fully-diluted shares, have agreed to support the offer and
tender all shares to the bid.
"Rockwater's companies are an excellent fit with CI and present an
attractive platform for growth while increasing our fee-earning assets to over
$96 billion," said William T. Holland, CI Chief Executive Officer. "We expect
these firms and their clients to benefit from the backing of CI's financial
resources and our expertise in investment management, operations and
technology."
"The acquisition of Rockwater continues our strategy of expanding CI's
distribution capabilities and building increased scale in our asset management
business," Mr. Holland said. "In particular, through Rockwater's subsidiary
Blackmont Capital, we will be gaining an impressive roster of over 180
first-rate investment advisors with assets under administration of $9.4
billion, as well as adding a new dimension to our business with Blackmont's
sales and trading group and its research and investment banking operations."
CI intends that, upon completion of the transaction, Blackmont Capital
will be run under the leadership of Gerry Throop and Bruce Kagan. KBSH, which
currently has assets under management of approximately $3.6 billion, will be
run as an independent business within the CI group of companies, maintaining
its current team of investment professionals.
GMP Securities L.P. acted as the exclusive financial advisor to CI in its
bid to purchase Rockwater.
CI Financial Income Fund (TSX: CIX.UN) is an independent, Canadian-owned
wealth management company with approximately $82.9 billion in fee-earning
assets as of January 31, 2007. CI offers a broad range of investment products
and services, including an industry-leading selection of investment funds. CI
is on the Web at www.ci.com/cix.
Rockwater Capital Corporation (TSX: RCC) is an independent financial
services company in three related businesses: investment counselling and
portfolio management (KBSH Capital Management Inc.), retail investment
management (Lakeview Asset Management Inc.) and a full service investment
dealer (Blackmont Capital Inc.).
This press release contains forward-looking statements with respect to CI
and its products and services, including its business operations and strategy
and financial performance and condition. Although management believes that the
expectations reflected in such forward-looking statements are reasonable, such
statements involve risks and uncertainties. Actual results may differ
materially from those expressed or implied by such forward-looking statements.
Factors that could cause actual results to differ materially from expectations
include, among other things, general economic and market factors, including
interest rates, business competition, changes in government regulations or in
tax laws, and other factors discussed in materials filed with applicable
securities regulatory authorities from time to time.
For further information: William T. Holland, Chief Executive Officer, CI
Financial, (416) 364-1145
