The deal is expected to finalize in late September 2017, subject to regulatory approvals.

Asset management firm CI Financial has agreed to acquire Sentry, melding the two Canadian active asset managers into a larger group amid continued industry consolidation.

Under the agreement, CI will acquire all of the outstanding shares of Sentry and its subsidiary, Sentry Investments, for a total of $780 million payable in $230 million in cash and the balance in CI shares, the firms said in a statement.

The transaction is expected to finalize in late September 2017, and is subject to regulatory approvals.

Sentry manages more than 45 mutual fund mandates and other investment solutions with approximately $19.1 billion in assets, as of July 31, 2017. Following the completion of the acquisition, Sentry will remain a standalone brand and will continue to provide its investment products and portfolio managers to Canadian investors.

According to CI, the transaction will increase its assets under management by 16 per cent to approximately $140 billion, from $120.4 billion at July 31, 2017. Total assets (assets under management plus assets under advisement) will increase to approximately $180 billion, it said.

"We're very pleased to be adding a firm of this quality to the CI Financial group of companies as it will significantly enhance our position as a Canadian independent global asset manager," said Peter Anderson, CI's chief executive. "The combined company will enjoy greater scale, which is key to being competitive in the investment industry today."

The firms both said: “Moving forward, both Sentry and CI will continue to share and be driven by their commitment to excellence in active investing and working in partnership with financial advisors to help Canadians meet their financial goals.”

Merger and acquisition activity continues to be a feature of asset and wealth management across the Americas. As reported in May, for example, a new whitepaper from asset management strategy consultancy Casey Quirk, a practice of Deloitte Consulting, said that the industry is likely to experience “the largest competitive re-alignment in asset management history” through merger and acquisition activity from 2017 to 2020. According to its new Investment Management M&A Outlook, Skill Through Scale? The Role of M&A in a Consolidating Industry, Casey Quirk expects strong merger and acquisition activity in 2017 with a continued historic pace of deals through 2020.

The rise in use of low-cost passive products, increasing regulatory burdens and less use - for the moment - of actively-managed, more high-yielding funds has put pressure on firms’ fees, encouraging M&A activity. A number of organizations, such as Cerulli and Moody’s, for example, have noted these trends. Moody’s, for example, said in a report last December that it had cut its outlook on the world’s asset management sector to “negative”, arguing that a flood of money into low-fee passive products from more expensive actively managed portfolios and rising compliance burdens have taken a toll.