(March 15 – 17:40 ET) – Merrill Lynch Canada Inc. has issued a report looking at the possible shakeout among mutual fund companies.
Merrill analyst Cameron Webster suggests that Trimark and AGF Management Ltd. make the most attractive takeover targets for buyers looking at cost synergies. C.I. Fund Management Inc. is viewed as the most appropriately priced, but it’s likely to be a buyer, not a seller. He suggests a takeout target range of $37 to $46 for AGF, and $23.60 to $28.60 for Trimark. AGF closed today at $32.05, down 5¢. Trimark finished up 20¢ at $17.25.
C.I. has gone from Neutral to Accumulate, thanks to its superior sales performance in an increasingly competitive game. Mackenzie Financial Corp. remains a short-term Accumulate, long-term Buy. Trimark remains a near-term Neutral and long-term Buy, with its struggling sales holding it back. IG’s target price is reduced from $30 to $27, although it is touted as the best value.
-IE Staff