CI Financial Corp. agreed to buy certain assets of Eaton Vance WaterOak Advisors, bolstering its presence in the lucrative U.S. wealth management market.

The deal will boost CI’s assets to US$133 billion in the U.S. and US$311 billion globally, the Toronto-based firm said in a statement Thursday. Financial terms weren’t disclosed. The seller of the assets is Morgan Stanley, which acquired the business known as Eaton Vance WaterOak, in the 2021 purchase of Eaton Vance Corp.

CI is among the firms seeking to capitalize on demand for financial advice by buying up smaller firms. It’s made dozens of small acquisitions since entering the U.S. market in 2020 -- and wealth management is now its biggest business line.

“This is one of our largest U.S. acquisitions by assets to date and aligns us with a growing firm with a rich history, an exceptional team, industry-leading wealth management capabilities and loyal, sophisticated clients,” CI Chief Executive Officer Kurt MacAlpine said in the statement.

RECORD DEAL PACE

The pace of mergers and acquisitions in the wealth management space is running hot. A pandemic stock market boom driven by low interest rates has fueled a surge in individual and family wealth, creating unprecedented demand for financial advisers who help those individuals and families manage their money.

A record 307 wealth management deals took place in 2021, a 50 per cent increase over 2020, which was the previous record, according to Echelon Partners. The trend was also driven by inflows of private equity cash and concerns about the inability of financial adviser firms to attract enough young new talent, which has driven consolidation. Echelon Partners said it anticipates that trend to continue this year.

In last year’s fourth quarter, CI acquired eight registered investment advisers and bought minority stakes in two alternative asset managers. It also opened a U.S. headquarters in Miami last year, a market that’s increasingly attracting hedge fund managers and finance executives.

Earlier on Thursday, Canada’s RBC Wealth Management agreed to buy Brewin Dolphin Holdings Plc in a deal that values the U.K. wealth manager at about US$2.1 billion.

CI shares fell 2 per cent to US$20.02 as of 1:45 p.m. in Toronto.