CI Financial Corp. is selling its minority stake in Boston-based registered investment advisor (RIA) Congress Wealth Management, LLC to Audax Private Equity, the Toronto-based firm said Thursday.
CI Financial acquired its stake in Congress in 2020 and holds it through CI Private Wealth, LLC, its U.S. wealth management subsidiary.
In a release announcing the sale, Kurt MacAlpine, CEO of CI Financial, said both “CI and Congress believe that minority ownership is not the best structure to maximize the client and employee experience [at Congress], and that Audax will be an excellent partner to support the next chapter of growth for Congress.”
CI Financial acquired Congress before it established CIPW’s private partnership model, MacAlpine said.
“To fully benefit from [the private partnership model’s] features, only active contributors to the business can be CIPW partners,” MacAlpine said. “Unfortunately, the ownership structure at Congress precludes it from fully integrating into CIPW.”
CI did not disclose what it received on the sale, but indicated in the release that the return was approximately three times its initial investment in Congress.
CI Financial also said it would use the proceeds from the transaction, which is expected to close next month, to pay down debt.
Last fall, Audax Private Equity made a strategic investment in Harbourfront Group, taking a partial stake in the Vancouver-based advisory firm. Harbourfront said it intended to use the investment for advisor recruitment, acquisitions and technology investments.