{"id":466563,"date":"2010-03-24T13:01:00","date_gmt":"2010-03-24T17:01:00","guid":{"rendered":"e2249889-c78b-43e3-9643-b1d7d4aa587b:412538"},"modified":"2010-03-24T13:01:00","modified_gmt":"2010-03-24T17:01:00","slug":"should-dundeewealth-buyback-scotiabanks-ownership-stake","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/466563","title":{"rendered":"Should DundeeWealth buyback Scotiabank’s ownership stake?"},"content":{"rendered":"

With more than $400-million in cash sitting on its balance sheet, DundeeWealth Inc.<\/a> should consider buying back Scotiabank's roughly 20% interest in the asset manager, says Stephen Boland, GMP Securities.<\/p>\n

"Beyond a large acquisition, another use of proceeds would be to
\npartner with [Dundee Corp., it's majority shareholder,] and repurchase
\nScotiabank\u2019s ownership stake," Mr. Boland said in a note to clients.
 
While discussions have reportedly occurred to strengthen the
\noperational partnership between Dundee and Scotiabank, Mr. Boland said
\nthere has been little evidence that talks have resulted in much progress. \n <\/p>\n

"This may be an opportune to time to retrieve this ownership stake if the partnership outlook is dim," he wrote, estimating the cost to be approximately $380-million. <\/p>\n

Management at DundeeWealth, meanwhile, appears to have other plans for the cash burning a hole in its pocket. <\/p>\n

On a recent earnings call, they said it would consider deploying their capital by hiring investment teams that would help diversify investor investment options. <\/p>\n

The other option mentioned was to make acquisitions similar to DundeeWealth's deal for 60% of Aurion Capital Management in 2008, worth $26-million.<\/p>\n

"In our opinion, neither of management\u2019s suggested uses of capital would be large enough (alone or combined) to effectively utilize current \u2018excess\u2019 cash," Mr. Boland said.<\/p>\n

He added that under normal circumstances, DundeeWealth could buy back shares or pay a special dividend. But with two material shareholders in Dundee Corp. and Scotiabank, that type of transaction may be too complex.  <\/p>\n

David Pett<\/a><\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

With more than $400-million in cash sitting on its balance sheet, DundeeWealth Inc. should consider buying back Scotiabank's roughly 20% interest in the asset manager, says Stephen Boland, GMP Securities. "Beyond a large acquisition, another use of proceeds would be to partner with [Dundee Corp., it's majority shareholder,] and repurchase Scotiabank\u2019s ownership stake," Mr. Boland […]<\/p>\n","protected":false},"author":4060,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-466563","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/466563","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/4060"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=466563"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/466563\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=466563"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=466563"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=466563"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}