PI Financial has its eye out for more deals
Gary Ng may not be well-known in Toronto’s financial circles, but he’s amassed an impressive resume: internet millionaire at 16, industrialist in China at 24 and a master at golf soon after.
Now at the ripe age of 35, he’s set an ambitious target for his next venture in the money management space, looking to quadruple assets to $50 billion in three years. Given his track record, you wouldn’t want to doubt him.
“I’ve been told I’m the most powerful man on Bay Street now that nobody’s ever heard of,” Ng said in an interview at Bloomberg’s Toronto office, referring to Canada’s financial hub.
Ng, who calls himself the Admiral of the fleet of financial firms he’s building, aims to boost assets from $12.5 billion by snapping up independent financial firms focused on equity, debt, trading and wealth management, using his own money. His firms already employ 758 people and have more than 100,000 clients.
Canada’s securities industry has been undergoing a seismic shift in the past two decades, with consolidation and closures reducing the number of firms. Those remaining benefit from higher profits and improved productivity, along with growing employee ranks. The average age of owners of non-bank owned investment dealers is 69, according to Ng, which puts him in an unique position to provide continuity and succession plans.
“It’s a perfect paradigm for me to strike,” he said, adding that he’s currently working on four potential acquisitions. The sweet spot is firms with $2 billion to $5 billion under management, but he’s also looking at bigger companies with as much as $15 billion in assets. “I am very well capitalized, and that’s the beauty of it.”
Ng’s first acquisition of a financial firm was a dad-and-son shop from Toronto, which he renamed Chippingham Financial Group, an amalgam of British terms for trading and hamlet. Ng then spent $100 million in December to buy PI Financial Corp., one of Vancouver’s oldest investment dealers. Ng, PI Financial’s executive chairman, is also majority owner of Montreal-based Rothenberg Group. The entrepreneur deepened his push into Canada’s financial industry with the purchase of an undisclosed stake in private lender Bridging Finance Inc. this summer.
The self-described “financial entrepreneur” started working as a coder for Redknee, renamed Optiva Canada, at 16, becoming an internet millionaire during the tech mania at the end of the last century. He says he plowed that into a Chinese glass factory that was eventually sold to Industrial Bank of China, giving him a US$150 million windfall.
The “retired” multimillionaire then set his sights on golf, playing up to 36 holes a day before driving his score down to 77. That five-over-par tally was enough, so he packed that in too for the most part.
“It’s all about the putting” he says, relaying his secret to a golf score that most weekend warriors can only dream about.
Bored to Tears
Ng, who still works from his hometown of Winnipeg, Manitoba, then needed a new venture.
“I was bored out of my mind,” he said. “I drove my grandma and my grandpa and my girlfriend nuts. I would use up all my BlackBerries; every month I would get a new one because the buttons would literally fly, so my friend suggested that I go into the commodity trading business,” he said.
Soon after Ng started his new trading career, Canada’s S&P/TSX Composite Index peaked before starting a slide during the financial crisis of 2008. He used the opportunity to build big short bets, making “millions,” he said, for his clients and for himself. He traded anything from pork bellies, to canola to bonds.
“The only time that new kings are born is when there’s chaos,” he said. “If everything’s hunky dory, the new kids never get a shot.”