IPC boss sheds light on restructuring, advisor cuts not part of plan

(August 22, 2003) The Investment Planning Counsel announced restructuring plans yesterday, including the replacement of some of its top executives, but CEO Steve Meehan wants to reassure the firm’s advisors.

“We’re not cutting advisor’s payouts, the number of advisors is staying the same,” says Meehan. “We’re just getting rid of the part of our company that was focused on doing mergers and acquisitions, because we’re just building the company organically.”

Meehan says this was not the fallout from the failed Dundee deal, but that the restructuring would have taken place sooner had IPC not been in those negotiations.

“A lot of the restructuring that we’re doing now would have happened as a natural course in the Dundee transaction,” he says. “Unfortunately, the Dundee transaction continued to carry on and carry on until finally we terminated it.”

He notes that this restructuring is necessary to trim inefficiencies that resulted from IPC’s growth, which he says was too rapid. The company is now regrouping and eliminating corporate overhead by bringing more operations under one roof.

“ING has provided the capital to do the restructuring, there were certain things we had to pay — like severance costs, costs for getting out of leases — they’re providing that capital,” says Meehan. “Right now, we are cash-flow positive and starting September 1, we’ll be even more cash-flow positive.”

While IPC is getting its house in order as an independent firm, Meehan says there is renewed interest in the company from potential suitors.

“There’s been tons of interest, but we’re just focused on growing the business now,” he says. “There’s been no shortage of people wanting to do a transaction. I can tell you it’s come from everywhere, but I can’t tell you who [might be involved].”

Filed by Steven Lamb, Advisor.ca, slamb@advisor.ca