Richardson closes deal for GMP Capital

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This article was published 21/10/2020 (1850 days ago), so information in it may no longer be current.

The complicated deal to rebrand and restructure the wealth management business partly owned by the Winnipeg Richardson family has been completed.

The business, called Richardson GMP has been rebranded Richardson Wealth (Partrimoine Richardson for the Quebec market) and the publicly traded entity which formerly owned about one-third of the wealth management business, GMP Capital Inc., has been renamed RF Capital Group Inc.

The Richardson family entity, Richardson Financial Group Ltd. will end up owning close to 44 per cent of RF Capital Group Inc. which now owns 100 per cent of the wealth management business.

Richardson Financial Group’s interest in GMP is for investment purposes and while they will have representation on its board, the company is run out of offices in Toronto.

The deal was complicated for a number of reasons. The wealth management business was owned almost equally by the Richardsons, GMP Capital and Richardson GMP’s financial advisers.

Late last year, GMP sold its capital markets business, leaving it to focus entirely on the wealth management business.

Kish Kapoor, the former Winnipegger who became GMP Capital’s interim CEO last year has had the “interim” title removed.

He said it was a very complex transaction with multiple stakeholders.

“First there was the sale of the capital markets business, a federal election, a pandemic… we have had to deal with incredibly complicated circumstances, complicated agreements and issues that all had a cascading impact on each other,” Kapoor said in an interview.

Dave Brown, vice-president of Richardson Financial Group and a member of the board of GMP Capital, said he’s very happy with the results of the two-year-long process.

“We believe it was worth the effort,” Brown said in an interview. “We think we have a real special business and a special group of investment advisers. We think we can build a very strong independent alternative to the banks.”

With about $29 billion of assets under administration and 19 offices across the country Richardson GMP (soon to be called Richardson Wealth) is the largest independent operator in a $4.4-trillion market — expected to balloon to $7.7 trillion by 2028 — that is currently dominated close to 90 per cent by the big banks.

Charlie Spiring, the CEO and co-founder of Winnipeg-based Wellington-Altus Private Wealth — and a former colleague of Kapoor’s — said there’s plenty of room in the market.

After only a couple of years in business, Wellington Altus has about $12 billion in assets under administration.

“The real enemy is not Wellington or Richardson,” Spiring said. “It is us versus the banks.”

martin.cash@freepress.mb.ca