Canaccord explores choices for UK wealth administration enterprise | USAEMALL.com

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Canadian financial services group Canaccord Genuity is working with bankers to run a strategic review of its UK wealth management business, in a move that could lead to a sale of the C$63bn ($45bn) in assets division.

Canaccord and London-based boutique investment bank Fenchurch Advisory are assessing the future of Canaccord Genuity Wealth Management UK, according to two people familiar with the situation. 

The strategic review was in its early stages and outcomes could include everything from an outright sale of the business to bringing another investor on board, the people said.

Canaccord and Fenchurch declined to comment. A person close to Canaccord said that the group had been “an active acquirer in the UK wealth management space” and for this reason it routinely engages external advisers “in the interest of exploring opportunities to support the growth of this business and maximise value for our shareholders”.

The strategic review comes as a wave of consolidation is sweeping across the UK’s wealth management industry, as groups pursue deals to scale up to combat pressure from rising regulatory costs and competition from cheaper “DIY” investment sites. 

Rathbones struck a £839mn deal last year to buy Investec Wealth & Investment UK to bulk up and help cut expenses.

Canaccord’s UK wealth management business provides financial advice to clients with assets of more than £250,000, or investment management services to clients who have over £250,000 of investable assets.

In the past decade or so, Canaccord has expanded in the UK through acquisitions. Most recently it bought the investment management business of Adam & Company from the Royal Bank of Scotland for £54mn in 2021, and acquired Punter Southall Wealth in 2022.

Although the UK wealth management business is majority owned by Canaccord in Canada, which has a market capitalisation of about C$1bn, New York-based private credit firm HPS Investment Partners also owns a stake. HPS, which is in talks to be acquired by the BlackRock, the world’s largest asset manager, declined to comment. 

In the latest quarter the UK and Crown Dependencies of Jersey, Guernsey and the Channel Islands made up half of Canaccord Genuity Wealth Management’s global revenues of C$217mn. But they rose at less than half the pace of the wider wealth management business when compared with a year earlier.

The UK wealth business also accounts for the lion’s share of the assets, with C$63bn, compared with C$40bn for North America and C$7.5bn for Australia.

Additional reporting by Eric Platt in New York