Seamark, GrowthWorks to form new asset management firm

Seamark has a 27-year track record of delivering investment management services to institutions and high net worth individuals. GrowthWorks has built a solid reputation in Canada’s venture capital industry and in the management of retail mutual funds.

Under the agreement, GrowthWorks and Seamark will become subsidiaries of Matrix. “Matrix will immediately have a national platform to deliver a diverse suite of investment services and products with top quartile performances in several asset classes” says Levi, who will become [resident and CEO of Matrix.

“This has the full support of our portfolio management team and is great news for our clients,” says Brent Barrie, Seamark CEO. “This transaction will better position Seamark to fulfill its mission of delivering the best possible investment management service to our clients.”

Seamark will maintain its headquarters in Halifax and will continue to offer portfolio management to institutional and high net worth private clients, including through wrap programs of leading Canadian investment dealers. No changes are expected in the personnel managing and servicing client portfolios. Each of Seamark’s portfolio managers has signed an agreement supporting the transaction. Barrie will continue to serve as CEO of Seamark.

With seven offices across Canada, GrowthWorks and its subsidiaries offer tax-advantaged investment opportunities through a family of venture capital funds. It also offers specialty retail investment funds, including flow-through limited partnerships, through Mavrix Fund Management Inc., which it acquired earlier this year.

Matrix will have assets under management of approximately $3 billion and be governed by a new board of directors, whose membership will include representatives from both the boards of GrowthWorks and Seamark, including Levi and Barrie. In addition, former Seamark CEO G. Peter Marshall will join Matrix’s board.

Stephen Rankin, chairman of Seamark’s board of directors, says the agreement represents great value for shareholders. “Profitability will be improved, and we expect to deliver significant long-term growth from a broader set of opportunities with less volatility than in the past,” Rankin explains

Matrix is expected to generate significantly greater revenues, earnings and growth in assets under management than Seamark operating alone.

As well, Matrix is expected to be in a position to initiate a regular quarterly dividend in 2010.

The agreement contemplates the exchange of Seamark common shares for Matrix common shares on a 1 for 1 basis, followed by the acquisition of all of the outstanding common shares of GrowthWorks in exchange for common shares of Matrix.

Holders of more than 53% of the outstanding common shares of Seamark have signed Support Agreements under which they have agreed to vote their shares in favour of the business combination. Holders of more than 74% of the outstanding common shares of GrowthWorks have signed Support Agreements under which they have agreed to tender their shares to the share exchange offer.

The combination is subject to a number of conditions, including approvals by Seamark shareholders, the TSX and securities regulators, and at least 90.1% of the outstanding GrowthWorks common shares being tendered to the share exchange offer.

Seamark shareholders will be asked to approve the transaction at a special meeting of shareholders expected to be held in January 2010. Approval of two-thirds of those voting will be required to effect the exchange of Seamark shares for shares of Matrix, and approval of a majority of those voting will be required in order to proceed with the acquisition of the shares of GrowthWorks.

The share exchange offer will be distributed to GrowthWorks shareholders on or about October 30. If the conditions to the business combination are satisfied, the transaction is expected to close in mid January 2010.

IE