Harbourfront closes transaction with US-based Audax Private Equity

Danny Popescu, Chief Executive Officer at Harbourfront Wealth Management

The Harbourfront Group of Companies, which includes Harbourfront Wealth Management Inc. (Harbourfront Wealth), a Canadian independent wealth management and planning advisory firm, announced the close of its previously announced strategic investment from Audax Private Equity (Audax), a US-based strategic partner that specializes in the middle market. The transaction successfully closed on September 9, 2022, pursuant to regulatory approval.

What does the transaction mean for Harbourfront?

Earlier this year, Harbourfront disclosed it secured a nine-figure investment from Audax, which represents an enterprise value of CAD $425m. Prior to transaction close, the firm disbursed a special dividend to its shareholders, primarily made up of the firm’s investment advisors.

Initially introduced by Raymond James in August 2021, Harbourfront picked Audax as its partner earlier this year after an in-depth assessment and evaluation of other contenders.  Additional participants include Fasken, Stikeman Elliot LLP, Kirkland & Ellis, KPMG International LTD, Blake, Cassels & Graydon, Bain & Company, Audax Group, and Antares Capital.

This is an accelerant of the firm’s expansion and next phase of growth. Harbourfront’s management will remain the key decision-makers of the growth strategy and operations. Harbourfront’s next phase of growth and immediate plan of action will include:

  • Complete add-on acquisitions
  • Sustain rapid organic growth through advisor recruitment
  • Maintain employee engagement and ownership
  • Invest further in the firm’s technology and
  • Add additional executive expertise to the Company’s leadership team.

What were the executives’ thoughts on the transaction?

“Harbourfront’s executive leadership and growth model are strong and unparalleled to what we’ve seen from firms in the Canadian investment advisory space. We knew investing in them was a sound decision. We plan to support Harbourfront in fully realizing its goals, which include aggressive growth plans across Canada,” said Bill Allen, Managing Director at Audax.

Notable participants of the transaction include Lynn Stibbard, CFO and COO of Harbourfront. “Audax underwent extensive due diligence process, which speaks to the high quality of our people and investment solutions that we’ve created and grown over the last 10 years. This funding is recognition and validation of our unique independent model and that it is valued in the wealth management industry,” said Lynn Stibbard, CFO and COO of Harbourfront.

“We’ve always been extremely well- capitalized so we never sought out any investors but when Raymond James’ Investment Banking team approached us to survey the private equity market, we realized bringing on a third-party investor would validate our thesis, creating a catalyst for an accelerated rate of growth,” said Danny Popescu, CEO of Harbourfront.

“Over the last 10 years, we’ve changed the lives of our clients through our exclusive retail service offerings and now, with this first liquidity round, we’ve changed the lives of our advisors who took the leap and joined us.  Advisors are realizing that Harbourfront is disrupting the industry with one of the best client offerings and the ability for advisors to be partners at a firm that rapidly creates value for shareholders,” Danny Popescu further added.

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