(July 27 – 10:15 ET) – A couple of fund companies who’ve been struggling of late are hooking up — fund giant Templeton Management Limited is buying out and Bissett & Associates Investment Management Ltd.
Templeton is offering $20.50 a share in cash for Bissett, for a total $140 million price tag. Bissett will also pay a 48¢ special dividend to its shareholders from its retained earnings. Principal Bissett shareholders, who control 67% of the firm, have already agreed to the deal. Bissett’s senior executives have entered into continuing employment agreements and will invest 30% of their proceeds from the sale of Bissett shares in the Bissett and Franklin Templeton Investments family of funds. David Bissett, chairman of the firm, and Kevin Wolfe, president, will retain those positions with Bissett Investment Management.
The board of Bissett has unanimously agreed to recommend the deal to Bissett shareholders. RBC Dominion Securities Inc. is serving as the financial advisor to the special committee of Bissett’s board of directors and Bissett. Merrill Lynch & Co. is serving as advisors to Franklin Resources Inc., Templeton’s parent.
Don Reed, president and CEO of Templeton said, “We are delighted to have the opportunity of combining businesses with one of Canada’s pre-eminent and most successful domestic investment management teams. Bissett’s Canadian investment management focus and strong track-record will provide an excellent complement to Templeton’s global products and the recently introduced Franklin growth-style U.S. and Specialty Equity products. Bissett’s investment management team will continue to operate independently, while both groups’ clients will benefit through expanded choices.”
“We are very pleased to be able to combine our expertise in Canadian investment management with the global expertise and reach of Templeton,” commented David Bissett, company founder. “Our primary objective was to select a partner of the highest quality, whose structure, philosophy and resources would best fit and support our organization, while allowing us to maintain independence in our investment management area. Although we will be part of a larger organization, our investment process and culture will remain the same. It will give us additional resources to expand and improve our research, investment management and client services.”
Following the deal Bissett reported net earnings of 25¢ a share for the second quarter ended June 30, up from 24¢ in 1999. Assets under management increased 2% to $5.7 billion at June 30, 2000 from a year ago.
-IE Staff