Canada's CI Financial Continues North America Wealth Acquisitions

Tom Burroughes

26 May 2020

Canada-listed CI Financial Corp has agreed to buy a strategic interest in Boston, Massachusetts-based Congress Wealth Management. Congress is a registered investment advisor overseeing $2.3 billion in assets under administration.

This transaction, which is expected to close early in the third quarter of 2020, solves succession planning for Congress employees and shareholders. Terms were not disclosed.

The deal comes after CI in February this year helped to fund Congress’s purchase of Domus Capital Group, a business based in Avila Beach, California. CI is also backing Congress as it works to finalize “another acquisition in the near future” that will bring Congress's assets to over $3 billion, the firms said in a statement today.

Congress provides wealth management and family office services to high net worth individuals, families, foundations, and endowments.

The move is another example of a flurry of merger and acquisition activity deals in the RIA space, driven by a desire by these firms’ owners to find an exit strategy, or go for economies of scale in an increasingly regulated field, and keep up with rising client service demands.

"By joining with a firm with a similar philosophy and client-centered approach to wealth management, we can build scale while we enhance the spectrum of services and solutions we offer. CI's financial strength and expertise in asset and wealth management are already accelerating our expansion,” Paul Lonergan, president of Congress, said.

Kurt MacAlpine, CI chief executive, said: “The RIA sector is the fastest-growing segment in US wealth management and Congress's location in Boston, a center for the technology, health, finance and education industries, holds additional growth potential. This investment also allows us to provide our Canadian clients with cross-border wealth services, another benefit of our RIA strategy."

To date, CI has acquired majority interests in Surevest, of Phoenix and One Capital Management, of Westlake Village, California, and reached an agreement to make a strategic investment in The Cabana Group, of Fayetteville, Arkansas. The four RIAs will have a total of $6.6 billion in assets.

CI's Canadian wealth management businesses, which include Assante Wealth Management Limited and CI Private Counsel LP, had about C$47.5 billion in assets under administration as of April 30, 2020.