When it comes to company overhauls, the financial advisers at Richardson GMP are no strangers to change.
Approximately half of the company’s 170 investment team members originate from the two founding firms: Richardson Financial Group and GMP Private Client, and have survived a series of mergers and acquisitions.
After selling its first investment dealer, Richardson Greenshields, to Royal Bank of Canada in 1996, the Richardson family returned to financial services in 2003 with the launch of Richardson Financial Group.
Before consolidation swept through the industry in the early 2000s, Richardson and GMP Private Client were rivals on Bay Street, both running similar investment brokerages that offered high-end advisers direct equity ownership in the company.
In 2009, the two firms merged, bringing GMP executive Andrew Marsh to lead the newly formed Richardson GMP. When Wellington West Capital (a west coast independent firm led by veteran Charlie Spiring) was scooped up by the National Bank of Canada in 2011, Richardson GMP became the last retail independent firm to offer advisers direct equity ownership. (Since then, Mr. Spiring has re-launched a similar brokerage.)
In 2009, Australian powerhouse Macquarie Group entered the Canadian market, and a new rivalry began with Macquarie Private Wealth. The two firms battled, poaching multimillion dollar books of businesses and advisers from each other. But less than four years later, Macquarie shocked the industry when it sold its Canadian wealth management arm for $132-million to Richardson GMP, its fierce competitor.
The addition of Macquarie’s business doubled Richardson GMP’s assets under management to $28-billion. But the deal also included a group of Macquarie advisers who had originally left Richardson GMP to join its main competitor, as well as advisers who did not fit the corporate culture of serving affluent families and entrepreneurs.
What happened next was one of the craftiest deals in the industry. Rather than pay severance, Mr. Marsh sold 60 investment advisers to Dundee Goodman Private Wealth, a division of Dundee Securities Ltd., for $15-million in 2014.
Now, after Richardson GMP’s parent company – GMP Capital Inc. – sold its investment banking arm to U.S. brokerage house Stifel Financial Corp., Richardson GMP will be renamed. The company has until June to drop the GMP brand, at which time the firm will return to its standalone Richardson family roots.
Editor’s note: (Jan. 13, 2020) An earlier version of this story incorrectly stated the purchase price for Macquarie Private Wealth as $132-billion. It was purchased for $132-million.
Clare O’Hara