The group has set a blistering pace in the speed and scale of its spending spree on US wealth management businesses. It is one of the most eye-catching M&A drives in North America’s wealth management sector.

Canada-based CI Financial, the group that has bought a large number of US wealth management firms since early 2020, today said it intends to sell up to 20 per cent of its US wealth business via an initial public offering.

The company plans to apply to the US Securities and Exchange Commission this year to get the process under way, it said in a statement. 

CI Financial said that once all its outstanding acquisitions of wealth firms are completed, CI’s US wealth management assets will stand at about $133 billion.

The spending spree of this group has been one of the most eye-catching M&A drives in North America’s wealth management sector. Predominantly, the activity has centered on buying stakes in, or complete ownership of, RIAs. A desire for economies of scale to deal with rising regulatory costs and tech spending, and the willingness of firms to sell, have fueled the process. Questions remain about how much of this consolidation will bear fruit. Recent figures suggest that the M&A trend is slowing down as valuations have risen.

“The growth in our US wealth management business is incredible; however, in our opinion, the value we have created isn’t reflected in our share price today,” Kurt MacAlpine, CI chief executive, said. “After a thorough evaluation of our strategic options, we are confident that a US-listed subsidiary IPO is the best route to shareholder value creation.”

“The US wealth management business now has sufficient scale to stand alone as a public company, creating an attractive, long-term destination for clients and advisors. We believe this is the best path to realizing our vision of becoming the leading ultra-high net worth business and high net worth business in the US,” he said.

The firm will use net proceeds from the share float to cut its debt.

CI will remain the majority shareholder of the US wealth management business and does not intend to spin out or otherwise divest its remaining ownership interest.

A final decision on the IPO size, conditions and timing is pending and will be subject to market conditions, CI added.

This publication has examined the role that private equity has played in the M&A story.