Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Life Insurance

Canada Life Board Scorns Manulife Offer

Your article was successfully shared with the contacts you provided.

NU Online News Service, Jan. 13, 10:31 a.m. – Canada Life Financial Corp., Toronto, says its board has officially rejected an unsolicited, informal takeover offer from Manulife Financial Corp., another Toronto life insurer.

Canada Life has mailed investors a circular justifying its argument that the price Manulife has offered for the company is too low.

Manulife has insisted that its offer for Canada Life, which is worth about $4.1 billion in U.S. currency, is a good deal for Canada Life shareholders, given the current price of Canada Life shares.

But two large investment banking firms, BMO Nesbitt Burns and Credit Suisse First Boston, agree that the Manulife price is inadequate, Canada Life says.

The offer is inadequate because it is priced at valuation multiples substantially below those derived from comparable transactions and fails to reflect the “unique value and growth prospects of Canada Life,” Canada Life says.

Canada Life also contends that Manulife made its offer at a time when the Canada Life share price is unusually low and the Manulife share price is unusually high.

“Manulife can afford to pay more,” Canada Life says in a statement about the offer. “Canada Life believes that Manulife has the ability to significantly increase its offer and still realize meaningful financial benefits for its shareholders.”

Canada Life has set up data rooms to provide financial data to other prospective buyers that might offer better deals, the company says.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.