Independent wealth manager Wellington-Altus Financial Inc. has sold a minority stake in the company for $388-million to U.S.-based private equity firm Kelso & Company.
The Winnipeg-based investment company announced Monday that Kelso & Company will acquire a 25-per-cent stake in Wellington-Altus in a secondary share sale, allowing shareholders to liquidate some of their holdings in the firm.
In an interview with The Globe and Mail, Wellington-Altus CEO Shaun Hauser said the transaction, which is expected to close in early 2026, marks a significant milestone in the company’s near-term growth plans to hit $50-billion in assets, while validating its business model with a $1.5-billion valuation.
“With one transaction we are able to show the street that our enterprise valuation, as it relates to our private equity, is absolutely worth every penny of what we state to our advisers and more, as we are getting a premium in this deal,” Mr. Hauser added.
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Based in New York, Kelso & Company is a middle-market private equity firm founded in 1971 by Louis Kelso, who pioneered the employee stock ownership plan at his newspaper chain in the 1950s. More recently, Kelso has been an active investor in the wealth management sector, including registered investment advisory firms, or RIAs.
In the past five years, Canadian wealth managers have seen accelerating consolidation, with several major independent firms selling to Canadian banks or international buyers. In 2024, investment giant CI Financial Corp. sold to Abu Dhabi’s Mubadala Capital for $4.7-billion, while Bank of Montreal acquired employee-owned Burgundy Asset Management Ltd. for $625-million earlier this year. Last month, Richardson Wealth, a major independent competitor to Wellington-Altus, sold to iA Financial in an all-cash deal for $597-million.
Mr. Hauser said Wellington-Altus’s independent employee-ownership model caught the eye of an “overwhelming number of interested parties” when he first began to look for an equity partner earlier this year.
“Wellington-Altus stands out for its innovative platform, entrepreneurial culture, and strong management team, making it the firm of choice for independent advisors in Canada,” Kelso partner Bill Frayer said in a statement.
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Mr. Hauser, along with Wellington-Altus co-founder Charlie Spiring, are long-time advocates for independent advisers and began to look for another equity partner in late 2024. The company was initially on track to announce a partnership in early 2025, but uncertainty in the U.S. halted investment plans for many private equity companies.
The discussions resumed in late summer, a bit ahead of schedule, Mr. Hauser said.
With 131 adviser teams managing $43-billion in assets, Wellington-Altus has spent the past eight years relentlessly recruiting financial advisers away from competitors. After an earlier round of equity financing, the company used about $85-million to expand and entice new talent – typically advisers who manage clients with more than $1-million in investable assets.
This is the fourth round of equity financing it has completed. The first three included primary private equity capital.
Unlike earlier rounds, Monday’s deal does not add equity to the balance sheet but allows existing Canadian shareholders to cash out a portion of their shares while ensuring that Wellington-Altus remains majority-owned by Canadians. The wealth manager’s advisers and employees remain the largest shareholder group.
Approximately 80 per cent of its shareholders have agreed in writing to support the transaction, Wellington-Altus said in a release.
In 2021, the Cynosure Group and Jessiman Family Investments Inc. put a combined $85-million into Wellington-Altus and received board seats.
Two years later, Cynosure injected another $40-million in a second-round growth equity investment, increasing its minority stake to 15 per cent.
Mr. Hauser said Cynosure – which has invested more than $100-million in Wellington-Altus – is not looking to cash in any of its shares, while Jessiman continues to hold one board seat.
In 2024, Wellington-Altus secured a new credit facility from private credit funds managed by Los Angeles–based Ares Management Corp. Mr. Hauser said the company has not yet tapped into the credit facility – and remains debt-free.
“We are not afraid of debt,” he added. “We’re a very profitable organization, so the truth is we haven’t had to use that. But when the right opportunities from an acquisition perspective pop up, we will have no problem using debt to create accretive transactions. We just haven’t had the ability to do that yet.”
Ardea Partners LP served as the exclusive financial adviser to Wellington-Altus. Goldman Sachs & Co. LLC served as financial adviser to Kelso.
