Independent fund giant CI Financial Corp. continues to boost its presence in the U.S. market with its latest purchase of a minority interest in Congress Wealth Management LLC, a Boston-based registered investment adviser firm that caters to high-net-worth families.
Congress Wealth, which manages US$2.3-billion in assets, is the fourth – and largest – registered investment adviser (RIA) acquisition announced by CI within the past seven months as it looks to expand its wealth-management capabilities outside of Canada.
Terms of the Congress deal, expected to close in the third quarter of 2020, were not disclosed.
The announcement Tuesday morning follows an earlier partnership between the two companies last February, where CI helped finance Congress’s purchase of California-based Domus Capital Group LLC. CI is also currently backing Congress as it finalizes another acquisition “in the near future” that will bring its assets to more than US$3-billion.
Chief executive Kurt MacAlpine, who joined the company this past September, has been vocal about CI’s plans to “globalize the company," which currently has about $130-billion in assets under management. CI’s expansion into the United States is part of the company’s attempt to put a greater focus on growing its wealth-management businesses.
In Canada, those businesses include Assante Wealth Management (Canada) Ltd. and CI Private Counsel LP, which have approximately $47.5-billion in assets under administration as of April 30.
CI’s global growth plan includes building a presence in the U.S. RIA market, which Mr. MacAlpine says will also provide Canadian clients with cross-border wealth services. In the U.S., RIA companies typically follow an independent business model – meaning they’re not part of a larger brokerage – and advisers have a legal fiduciary obligation to act in the best interests of clients.
Since November, 2019, CI has acquired majority interests in Phoenix-based Surevest Wealth Management and California-based One Capital Management LLC. It also reached an agreement to make a minority investment in the Cabana Group, LLC, of Fayetteville, Ark. Along with Congress Wealth, the four RIAs will have a total of US$6.6-billion in assets.
Mr. MacAlpine said in a news release Tuesday that the latest acquisition makes CI “the most active acquirer” in the U.S. RIA space in both number of acquisitions and dollar value.
“We expect this momentum to continue and to accelerate as our platform continues to grow and our brand awareness in the U.S. becomes mainstream,” Mr. MacAlpine said.
CI’s other strategic priority is to modernize its asset-management business. Last week, the fund company acquired the remaining 25 per cent of robo-adviser WealthBar Financial Services Inc. CI, which already held a 75-per-cent majority interest, will combine the online portfolio manager with CI’s discount brokerage, Virtual Brokers. In the coming months, the two companies will be rebranded as CI Direct Investing.
Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.
Clare O’Hara