CI Financial sets up US headquarters in Miami

One day after logging its 21^st acquisition of a U.S. wealth management firm in less than two years, Toronto-based CI Financial announced that it’s establishing a U.S. headquarters in Miami.

Since entering the U.S. market in early 2020, CI has amassed more than $80 billion of RIA assets south of the Canadian border and has more than $260 billion in global assets.

“This is part of our continued evolution of our platform,” said Kurt MacAlpine, CI’s chief executive.

“It serves as the next logical step for our expansion plans as we work to build the leading high-net-worth wealth management platform in the country,” MacAlpine said. “In addition, Miami is a vibrant, multicultural city that offers a deep talent pool, an attractive location for recruiting and a very business-friendly environment.”

MacAlpine is not shy about expressing his goal of continuing to build out CI’s footprint across the U.S.

While he said he doesn’t pay as much attention to geography as he does the quality of target RIAs, he admitted, “We are rounding out the country quite nicely.”

CI’s growth through acquisitions is even more notable when put in the context of its starting from zero during the early stages of the Covid pandemic.

“Last year was about establishing CI Financial as a buyer from a dead standstill,” MacAlpine said. “Both last year and so far this year, we’ve had the highest number of deals and the most assets.”

MacAlpine acknowledged that being among the most aggressive buyers in the wealth management space, especially as a newcomer from a different country, has drawn some criticism from competing aggregators concerned about CI driving up valuations.

“I take the criticism as a compliment,” he said. “We’re paying attractive valuations for exceptional businesses, and anyone opining on what we’re doing is doing so from an uninformed standpoint.”

CI Financial is a publicly traded company listed on both the Toronto Stock Exchange and the New York Stock Exchange, and so far it has not had to release the details of what it has paid for any of the U.S. acquisitions.

MacAlpine said the deals are all being financed through a combination of stock, cash and “the ability to retain ownership in your wealth management business.”

“As a public company, when you hit the materiality threshold, you’re required to disclose the acquisition price,” he said.

While the wealth management industry is flush with cash as deep-pocketed private equity investors flood into the space, CI is able to leverage its swelling stock price. This year through Tuesday, the firm’s stock is up about 70%, which compares to an 18% gain for the S&P 500 Index over the same period.

While the stock market has been a tailwind for the wealth management space, MacAlpine said $4 billion of the increase in CI’s assets under management over the first six months of the year represents organic growth unrelated to acquisitions or market performance.

CI, which Tuesday announced the acquisition of $5.2 billion Portola Partners in Menlo Park, California, represents the largest financial institution to locate its headquarters in South Florida, according to Miami Mayor Francis Suarez.

“The significance of this cannot be overstated and moves us further towards our goal to become the capital of capital,” Suarez said. “We thank Kurt MacAlpine, the board of directors, their executive team, and our own Venture Miami team for supporting their move to the City of Miami.”

The office will be home to CI’s U.S. operations and the primary location for its U.S. leadership team. The company’s executive officers will split their time between the Miami and Toronto offices, and it expects to expand its presence in Miami over time.

“We are thrilled to welcome CI Financial to Florida,” Florida Gov. Ron DeSantis said in the statement. “Their move is the latest example of our welcoming business climate at work – something we continue to see from Miami to Pensacola. We appreciate CI Financial’s commitment to our state and wish them all the success.”

Related Topics: CI Financial, Miami