TD Bank 2001 Annual Report Download - page 71

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FINANCIAL RESULTS
(a) Acquisition of TD Waterhouse shares
In October 2001, the Bank announced its intention to acquire
the common shares of TD Waterhouse that it does not own for
total consideration of approximately US$386 million. Goodwill
and intangibles arising from the proposed acquisition are expect-
ed to be $250 million.
In connection with the proposed acquisition of the TD
Waterhouse shares, the Bank announced in October 2001, that it
will issue common shares to partially fund the transaction. On
November 1, 2001, approximately 11 million common shares
were issued for cash proceeds of $400 million.
(b) Acquisition of R.J. Thompson Holdings, Inc.
During the year, TD Waterhouse announced the acquisition of
R.J. Thompson Holdings, Inc., a direct access brokerage firm.
The acquisition closed on November 1, 2001 and total consider-
ation in respect of this acquisition amounted to $122 million,
paid in cash. Goodwill and intangibles arising from this acquisi-
tion are expected to be $118 million.
(c) Acquisition of Newcrest Holdings Inc.
The Bank acquired all of the outstanding Class A and Class B
common shares of Newcrest Holdings Inc. (Newcrest), a holding
company for the securities dealer Newcrest Capital Inc., effective
November 1, 2000. The total consideration in respect of this
purchase amounted to $225 million, paid in Bank common shares
of $181 million and cash of $44 million. The acquisition was
accounted for by the purchase method and the results of
Newcrest’s operations have been included in the consolidated
statement of income from November 1, 2000. Goodwill arising
from the transaction of $160 million is being amortized on a
straight-line basis over the expected period of benefit of 10 years.
(d) Acquisition of Canada Life Casualty
Insurance Company
On December 31, 2000, Meloche Monnex Inc., a wholly-owned
subsidiary of the Bank, acquired all of the outstanding common
shares of Canada Life Casualty Insurance Company (CLIC) for
cash consideration of $80 million. The acquisition was accounted
for by the purchase method and the results of CLIC’s operations
have been included in the consolidated statement of income from
the effective date of acquisition. Goodwill arising from the transac-
tion of $40 million is being amortized on a straight-line basis over
the expected period of benefit of 10 years.
(e) Sale of investment real estate
During the year, the Bank sold certain investment real estate for
a pre-tax gain on sale of $350 million, net of deferrals.
(f) Acquisition of CT Financial Services Inc.
On February 1, 2000, the Bank acquired substantially all of the
common shares of CT Financial Services Inc. (CT), a holding
company for a group of companies which together operated as a
Canadian financial services company under the name Canada
Trust. The total consideration in respect of this purchase amount-
ed to $7,998 million, paid in cash. The cash for the acquisition
was obtained as follows:
(millions of dollars)
Issue of common shares $ 700
Issue of preferred shares 410
Issue of trust units of subsidiary 900
Issue of subordinated notes 750
Wholesale deposits 5,263
Less: fees and expenses (25)
Tot al $ 7,998
Revenue (on a taxable equivalent basis)
(millions of dollars) 2001 2000 1999
Canada $ 7,920 $ 6,823 $ 4,772
United States 1,677 2,595 2,752
Other international 1,486 786 458
Total1$ 11,083 $ 10,204 $ 7,982
1Excludes gain on sale of TD Waterhouse Group, Inc. in 1999.
Geographic distribution of revenue
The Bank earns revenue in Canada, the United States and other
international locations. Reporting is based on the geographic
location of the unit responsible for recording the revenue.
NOTE 18 Acquisitions and dispositions