Gluskin Sheff Declines 5.1% as Sale Search Ends: Toronto Mover

Gluskin Sheff + Associates Inc. (GS) fell 5.1 percent after the Toronto-based money manager signaled it ended a review of the firm without finding a buyer.

Gluskin Sheff fell to C$17.98 at 3:14 p.m. trading in Toronto, the biggest intra-day drop since April 5, according to Bloomberg data.

The company said today in a statement that it concluded a review of alternatives to “explore shareholder value maximization” at the request of founding shareholders, Ira Gluskin and Gerald Sheff.

“What that tells me is they were thinking of selling, but that the bids didn’t come in to where they would sell at,” said Adam Seanor, an analyst at M Partners Inc. in Toronto who rates the stock a “buy.” “It’s not being sold until Ira and Gerald decide they want to sell and as soon as they decide to sell, I’m fairly certain there’s multiple bidders.”

Gluskin Sheff’s statement followed a Globe and Mail report today that the money manager hired bankers for a possible sale and that buyers had submitted bids. Suitors may include Canada’s biggest banks, another money manager or private equity firms, the Toronto-based newspaper said.

“The founders, the board and management have concluded that the current platform remains an excellent way to serve clients and enhance shareholder value at this time,” the firm said. David Morris, chief financial officer, didn’t return calls seeking comment.

Gluskin Sheff was founded in 1984 to serve wealthy clients and institutional investors, according to the company website. The firm now offers equity, fixed income and alternative investment strategies.

The stock drop gives investors a chance to buy Gluskin Sheff shares at a reduced price, after the stock had surged 27 percent this year before today.

“It gives you an opportunity to buy it on a fundamental basis, with the knowledge that there’s likely to be a take out at some point in the future, but it may be a number of years down the road,” Seanor said.

To contact the reporter on this story: Doug Alexander in Toronto at dalexander3@bloomberg.net

To contact the editors responsible for this story: David Scheer at dscheer@bloomberg.net; David Scanlan at dscanlan@bloomberg.net

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