TORONTO — Shares in CI Financial Corp. soared after it announced a deal to sell a 20 per cent stake in its U.S. wealth management business to a group of institutional investors for about $1.34 billion.
Shares in the company were up $5.61 or nearly 45 per cent at $18.11 in early trading on the Toronto Stock Exchange.
CI is selling the stake in the business to a group including a wholly owned subsidiary of the Abu Dhabi Investment Authority, Bain Capital, Flexpoint Ford, Ares Management funds, the State of Wisconsin and others.
The company plans to use proceeds from the sale to reduce debt.
CI had started a process for an initial public offering for its U.S. wealth management business late last year, because it believed its share price did not reflect the value it had created for shareholders across both its Canadian and U.S. businesses.
CI chairman William Holland says the transaction announced today creates substantial value for shareholders and represents an attractive alternative to the IPO of the U.S. business.
This report by The Canadian Press was first published May 11, 2023.
Companies in this story: (TSX:CIX)
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