Lee Chin sells AIC to Manulife

[Peter R]

Just read this in the "Globe and Mail" (Canada) yesterday. At its peak AIC had over $15B under management. Now down to about $4B (or so ) according to the report.

The selling price is reportedly $150M (sounds like peanuts eeh?) most if not all in Manulife shares. he's now on their payroll as an administrator/manager.

Looks like the buy and hold (Warren Buffet) philosophy didn't work well for MLC especially as of late. Anyway, by all measures he's still the epitomy of financial success by a Jamaican, globally.

[Mosiah]

i feel for him. how will he manage?

[Gamma]

i feel sorry for those who bank wid ncb...him a get back him money somehow!

[Assasin]

if that is a sale then I have a bridge to sell you.

The man just want free up some money.

[OJ]

Manulife buys AIC as Lee-Chin retreats


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Magnate silent on sale terms, fuelling speculation mutual fund business scooped `for next to nothing'

Aug 13, 2009 04:30 AM

Rita Trichur
Madhavi Acharya
Tom Yew
BUSINESS REPORTERS

Buy, hold and prosper – except if you're billionaire Michael Lee-Chin.
Canada's erstwhile mutual-fund magnate, who made a fortune flogging that Warren Buffett-style investment philosophy, cemented his retreat from the industry yesterday after agreeing to sell AIC Ltd.'s Canadian retail investment fund business to insurance giant Manulife Financial Corp.
Financial terms of the deal were not released. Lee-Chin, who for decades held himself out as a champion to small investors, declined to speak with the Star.
His silence helped fuel speculation that Manulife scooped up AIC's ailing investment fund business for a bargain basement price. "The value is probably next to nothing," said one source speaking on the condition of anonymity, suggesting it likely sold for about $100 million.
AIC assets under management – $3.8 billion at the end of July – suggest a company that is merely a rump of its former self.
While Manulife said it will pay with exchangeable securities, it did not give details. The deal requires regulatory and unitholder approval.
Sources say that Lee-Chin is reportedly selling some of his Caribbean investments due to tight credit conditions. Those investments are said to include Jamaican real estate and a 20 per cent stake in Columbus Communications, which owns an undersea fibre-optic cable throughout the Caribbean.
The Jamaica Gleaner reported last month that Lee-Chin failed to come up with $155 million (U.S.) to cover a principal payment that AIC Barbados owed bondholders by June 11 – a date already extended from the original March maturity. The new deadline is in November.
A man with humble beginnings, Lee-Chin is now synonymous with all things ornate. The Royal Ontario Museum's Crystal bears his family name. The hallmarks of his flamboyant lifestyle: private helicopters, exotic cars and weekend getaways to the Caribbean.
The Jamaican-Chinese businessman is 16th on the richest Canadians list, according to Business Week. That's down from 2007, when he was 11th. His net worth is estimated as $2.4 billion.
In recent years, however, his mantra began to ring hollow as performance lagged and redemptions surged, as investors pulled their money out of AIC funds.
"In one way it's surprising. In another way, it's like the inevitable has finally happened. Everything he said seemed to imply he wouldn't sell, ever. But we're into 7 1/2 years of net redemptions," said independent analyst Dan Hallett. "I didn't see a catalyst to turn things around. I think the redemptions would have continued and the assets would have continued falling."
Lee-Chin, 58, came to Canada from Jamaica in 1970 to study civil engineering. Instead, he became a financial adviser. In 1987, he bought AIC, a firm with less than $1 billion in assets under management.
The typical mutual fund may hold as many as 200 different stocks at any given time and turns over the entire portfolio every 18 months or so. AIC's flagship Advantage Fund holds only 10 to 20 stocks and hangs on indefinitely.
From the early to mid-1990s, managers delivered a steady stream of double-digit returns. In 1996, they hit the ball out of the park with an annual return of 66.5 per cent. The following year, the return was 43.3 per cent.
Investors couldn't get enough of Lee-Chin and his folksy charisma. He presided over investing seminars at the company's sprawling headquarters in Burlington, Ont., bringing in speakers such as retired general and former U.S. secretary of state Colin Powell and Jack Welch, former CEO of General Electric.
The boom in technology stocks in the late 1990s derailed the winning streak. Performance lagged, then turned negative in 1999, then again in 2001 and 2002.
The fund's assets peaked at $15.4 billion in March 2002, then began to slide.
In 2005, as assets sat at $8.7 billion, Lee-Chin had sharp words for his own investors.
He told the Star in an interview, "The frustration is that we have unitholders who are short-term in their thinking but the investment process is more of a longer-term horizon. The problem is one of a lack of patience on the part of investors. What we won't do is change our behaviour."
Critics quipped that "buy, hold and prosper" was more like "buy, hold and suffer."
In 2008, the fund sank by 51.1 per cent.
Once the deal is complete, Manulife estimates its retail fund assets under management for Canadians would grow to about $13.7 billion.
"This is a great fit for Manulife and AIC Limited," Paul Rooney, Manulife Canada's chief executive, said in a release.

[Peter R]

Might have to move to a trailer park...

[Mosiah]

buy it first though!

[Yuttie]

damn, Mr Hill mussi know a wikid piece a Obeah man.