The canadian securities Institute, which offers mandatory education courses to the securities industry, has a new owner.
The Investment Dealers Association of Canada has sold the CSI to private equity fund Oncap II LP, which has partnered with senior CSI management on the deal. The small-cap fund, with a $400-million pool of capital, was established in 1999 by Onex Corp. and has the deep pockets necessary to take CSI to the next level.
“It’s an exciting new world,” says Roberta Wilton, president, CEO and now part owner of the Toronto-based CSI. “It’s a wonderful opportunity to take a successful operation and make it extremely successful.”
Wilton, who won’t divulge terms of the deal or the number of upper management members involved, says that the new partnership fulfils the goal of severing the CSI’s dependence on the IDA while ensuring it is strongly capitalized.
That’s not to say the CSI is cutting its ties to the IDA. As it offers several must-have courses, such as the Canadian securities course and the fellow of the Canadian Securities Institute, and is endorsed by the IDA, it’s essential that the CSI continues to work closely with the regulatory body, says Wilton.
“We’re going to continue to have a strong and vibrant relationship with the IDA,” Wilton says. But the CSI now has the balance sheet to branch out into financial services education and training, both domestically and internationally.
The appeal of the CSI as an investment is obvious, says Jeremy Thompson, partner with Oncap in Toronto. As one of the leading education providers in the financial services industry, the CSI boasts a solid market position and a strong management team. It also has an established content development infrastructure. “The CSI has the ability to develop a course or exam for anyone,” he says, “be it a course that’s required to get into the securities industry or a training course that a financial institution would use internally to educate its own staff.”
The CSI is the first education platform within the seven company-strong Oncap family, which includes aerospace defence business CMC Electronics Inc., national asset-registration firm Canadian Securities Registration Systems and inventory service provider WIS International. Although the CSI is an entirely new category for Oncap, it’s a good fit within the fund company’s roster, says Thompson, because it boasts strong business outsourcing potential.
Although the CSI’s core business of providing mandatory courses lies at the root of its success and investment appeal, he says, its growth potential may well stem from the support services side of its business. For example, the CSI will now have the ability to offer more in the way of exclusive training courses for banks or brokerage firms. “We’d like to see the CSI use that ability in more places,” he says.
As with all of its investments, Oncap will be hands-off, leaving CSI management to do what it does best. “If anything, it as ‘more of the same,’ with the ability to grow the business more rapidly should it find the right opportunity,” Thompson says.
To that end, the education provider has moved forward with plans to offer a podcasting element to its curriculum with the recent launch of a pilot program that will test the effectiveness of using popular gadgets, such as iPods or MP3 players, as learning tools.
Covering topic areas that most often stump CSC students, such as hedge funds and Bank of Canada monetary policy, the 10 podcasts are being tested by about 200 first-time students. Each audio file, accessible through a portable device or computer, is between seven and 13 minutes long, says Jay Flye, the CSI’s vice president of sales.
“They are bite-sized,” he says. Topics were chosen by the number of queries a particular subject typically generates. The lessons walk listeners through the material, allowing for a deeper understanding of course content, he adds.
Follow-up research will indicate what tweaks must be made before the program rolls out nationally in the second or third quarter. IE
Onex Corp. affiliate buys CSI
Small-cap fund and senior management to venture into new territory
- By: Wendy Cuthbert
- January 27, 2006 January 27, 2006
- 14:22