Investment giant CI Financial is selling a 20-per-cent stake in its U.S. wealth management business for $1.34-billion to pay down outstanding debt while it pauses plans to take its U.S. division public.
In 2016 and 2017, well before the acquisition spree, CI’s debt-to-EBITDA ratio was below 1-to-1, according to S&P Global Market Intelligence. That spiked to 4.3, as of Dec. 31, 2022. Now, the proceeds from today’s announcement, along with the proceeds from the Congress deal, will total $1.5 billion, CI said in a release. The funds will be used to reduce debt and lower CI’s debt ratio from 4.0 to 2.7, when accounting for the earnings reduction associated with the minority investment.operation and sell as much as 20 per cent of the division in an initial public offering in order to help pay down debt.