AGF Management Ltd. announced Wednesday that fourth-quarter profit dropped slightly and it would acquire 14 funds from a unit of ING Canada Inc.

AGF, Canada's eighth-largest mutual fund manager, said it earned C$21.2 million ($17 million) or 23 Canadian cents per share, an 11% decrease from C$23.8 million, or 26 Canadian cents a share, in the year-ago period.

The company raised its quarterly dividend by 36.4% to 15 Canadian cents a share, reflecting strong free cash flow. Revenue slid to C$157.4 million from C$159.1 million, while expenses edged up to C$127 million from C$125.6 million.

Average daily mutual fund assets under management dropped 6.9% to C$22.7 billion in the quarter, from C$24.4 billion in the same period last year.

Separately, AGF said ING Investment Management will transfer about C$240 million in assets under management to AGF, where assets from 13 funds will be merged into existing AGF funds. AGF did not elaborate on financial terms of the deal.

Meanwhile, the top-selling ING Canadian Dividend Income Fund will be renamed AGF Dividend Income Fund, and ING Investment will continue to manage it as the exclusive sub-adviser.

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