Industrial Alliance To Acquire Sarbit Asset Management

TORONTO, Sept. 8, 2008 – Industrial Alliance Insurance and Financial Services Inc. (“IA”) is pleased to announce that it has entered into an agreement with Sarbit Asset Management Inc. (“SAMI”) aunder which IA will offer to acquire all of the issued and outstanding shares of SAMI. IA has also entered into lock-up agreements with shareholders representing over 75% of the issued and outstanding shares of SAMI.

SAMI is a privately-owned mutual fund manager founded in 2005 by Larry Sarbit, a money manager with over 28 years’ experience. Mr. Sarbit is recognized for his disciplined, value-oriented investment philosophy focussed primarily on U.S. equities.

The acquisition of SAMI provides IA with approximately $130 million in assets under management, which will be integrated with IA Clarington Investments Inc. (“IA Clarington”), a subsidiary of IA. Mr. Sarbit and his investment team will continue providing investment advice to SAMI’s U.S. equity funds after the transaction is completed, and the remainder of the Sarbit mutual funds will be managed by an affiliate of IA Clarington.

“Larry Sarbit is well known to financial advisors and investors in Canada,” said David Scandiffio, President of IA Clarington. “He has managed large mutual funds with assets in excess of $2 billion, as well as smaller funds, such as the $85 million Sarbit U.S. Equity Trust, and done so through a full range of market cycles. We are pleased that Mr. Sarbit has agreed to continue providing his unique style of investment advice to SAMI’s U.S. equity funds after completion of the transaction through an ongoing sub-advisory relationship.”

“Investors in Sarbit mutual funds will enjoy the benefits of being part of IA Clarington, including its increased size and scale of operations, a broad range of investment options and a strong commitment to investment performance and customer service,” said Mr. Sarbit, President and CEO of SAMI. “The decision to sell the company I founded was not an easy one, but I am happy to have found a buyer such as IA that is firmly committed to meeting the needs of investors and financial advisors.”

The transaction adds to IA’s string of wealth management acquisitions and marks the 14th transaction since the early 2000s. Subject to requisite shareholder and regulatory notifications and approval, the transaction is expected to close on or before October 31, 2008.

About Industrial Alliance

Founded in 1892, Industrial Alliance Insurance and Financial Services Inc. is a life and health insurance company that offers a wide range of life and health insurance products, savings and retirement plans, RRSPs, mutual and segregated funds, securities, auto and home insurance, mortgage loans and other financial products and services. The fourth largest life and health insurance company in Canada, Industrial Alliance is at the head of a large financial group, which has operations across Canada, as well as in the Western United States. Industrial Alliance contributes to the financial wellbeing of over 3 million Canadians, employs more than 3,300 people and manages and administers over $51 billion in assets. Industrial Alliance stock is listed on the Toronto Stock Exchange under the ticker symbol IAG. Industrial Alliance is among the 100 largest public companies in Canada.

About IA Clarington

IA Clarington managed approximately $7.5 billion in mutual fund and closed-end fund assets as at July 31, 2008. IA Clarington maintains offices in Toronto, Calgary, Vancouver, Montreal and Quebec City.

About Sarbit Asset Management

Sarbit Asset Management Inc. was founded in 2005 and is an investment management firm providing investment advisory and related services. Sarbit distributes its services through a diversified network of third party financial advisors who look for a rational, common sense and business-like approach to investing.

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