CI Financial's transition to private ownership raises transparency and competition concerns in Canada
CI Financial Corp. is set to go private in a $4.7bn transaction with Mubadala Capital, the alternative asset management arm of UAE-owned Mubadala Investment Co., according to BNN Bloomberg.
Mubadala Capital will pay $32 per share in cash for the Canadian wealth and asset management firm.
CI Financial shares closed up 30 percent at $31.22 on Monday on the Toronto Stock Exchange following the announcement.
William Butt, CI’s lead director and chair of the special committee, stated that the deal represents an “exceptional outcome for shareholders” and provides long-term capital to support the company's transformation.
“This transaction also provides significant benefits to Canada by providing long-term capital to underpin the building of a Canadian champion in the wealth and asset management industries,” said Butt in a statement.
CI Financial said it expects to maintain its Canadian headquarters, current operations, structure, and management team under Mubadala Capital's ownership.
CEO Kurt MacAlpine, who is set to continue leading the firm, said, “With this transaction, CI has never been better positioned to fulfil our mission of delivering outstanding services and solutions to our clients.”
MacAlpine plans to roll all his equity into the deal, and other senior management members are expected to participate in similar equity rollover agreements.
The acquisition is part of a broader trend of private equity firms acquiring Canadian companies.
Rachel Wasserman, a fellow at the Canadian Anti-Monopoly Project, expressed concerns about the growing prevalence of private equity ownership.
“When it’s one company, it doesn’t matter, but this is happening at such a scale that it is becoming a real problem,” said Wasserman, citing her recently published paper on private equity.
She noted that private equity ownership can reduce transparency, limit average investors’ access to firms, and pose competition concerns.
Wasserman added that some private equity acquisitions focus on extracting value from businesses without fostering growth.
She highlighted other Canadian companies that have gone private in recent years, including WestJet, Rexall, and Sleep Country Canada, as well as funeral homes, dentists, and veterinary clinics.
She noted the significance of CI Financial’s new ownership, saying, “Ownership matters -- who owns the company influences everything. We now have the Abu Dhabi government owning Canada’s largest independent financial advisory firm.”
The deal is subject to court and regulatory approvals, shareholder consent, and other customary closing conditions. It is expected to close in the second quarter of 2025.
Mubadala Capital emphasised its long-term outlook and commitment to stability, which it says will benefit CI’s clients and employees.
