The Board of Directors of CI Financial Corp. (“CI”) (TSX: CIX; NYSE: CIXX) today announced CI’s intention to sell up to 20% of its U.S. wealth management business via a U.S. initial public offering (“IPO”). The company plans to submit a Form S-1 to the U.S. Securities and Exchange Commission this year.
Since entering the U.S. wealth sector in early 2020, CI has become the country’s fastest-growing wealth platform and the U.S. wealth management business has grown to become CI’s largest business unit by assets. Once all outstanding acquisitions are completed, CI’s U.S. wealth management assets will reach approximately US$133 billion.
“The growth in our U.S. wealth management business is incredible; however, in our opinion, the value we have created isn’t reflected in our share price today,” said Kurt MacAlpine, CI Chief Executive Officer. “After a thorough evaluation of our strategic options, we are confident that a U.S.-listed subsidiary IPO is the best route to shareholder value creation. The U.S. 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 and high-net-worth business in the U.S.”
CI intends to use the net proceeds from the IPO to pay down debt.
CI will remain the majority shareholder of the U.S. wealth management business and currently has no intention of spinning out or otherwise divesting its remaining ownership interest.
A final decision on the IPO size, conditions, and timing is pending and will be subject to market conditions.