A Bay Street sign, a symbol of Canada's economic markets.Mark Blinch/Reuters
Canaccord Genuity Group Inc. has been hit with a string of veteran departures amid a severe commodity price correction that has raised the prospect of more job cuts.
On Tuesday, one of the dealer's few remaining executives with ties to its roots as a Vancouver powerhouse announced his departure. Scott Davidson, executive vice-president and global head of corporate development and strategy, is moving on.
The announcement extends the firm's leadership upheaval since former chief executive officer Paul Reynolds died of a heart attack in April, 2015, spurring a succession process no one expected.
In September, the board of directors tapped Dan Daviau, who joined the firm through the acquisition of Genuity Capital Markets in 2010, to take over. The appointment has shifted the balance of power away from the dealer's roots to the acquired team.
Chairman David Kassie, for one, also joined the dealer from Genuity.
As the commodity rout drags on, there are growing questions about what Mr. Daviau will do to weather the storm. Because resource prices started sagging long ago, the dealer tried to tackle the problem by cutting 4 per cent of its work force last February. Canaccord Genuity has also said goodbye to costly deal makers who weren't bringing in much business.
But the expectation on Bay Street is that more cuts will be necessary to slash costs because future revenue growth is looking rather grim. Canaccord Genuity's shares have fallen 45 per cent in the past year, closing at $4.15 Tuesday.
Mr. Davidson joined Canaccord Capital in 2002, back when founder Peter Brown was still running the shop. Early on, he ran marketing, but gradually earned more responsibility and later added communications to his portfolio.
Eventually earning the trust of Mr. Reynolds, who took over in 2007, the two men grew close and Mr. Davidson became part of the inner circle that ran the dealer, leading to his strategy role.
Mr. Davidson has been with the firm through its initial public offering and all its major deals, including the 2010 Genuity acquisition, as well as the $400-million purchase of London-based Collins Stewart Hawkpoint in 2011. The latter is its biggest to date, and it is arguably Mr. Davidson's baby, considering he is the one who executed it.
By acquiring in Britain, Canaccord Genuity added a revenue stream that isn't as closely tied to the Canadian commodities market, which had long been the dealer's bread and butter. The purchase almost doubled the size of Canaccord's wealth management business by adding $13-billion in assets, helping to diversify revenues.
Six months into fiscal 2016, which has been marred by a commodity rout, Canaccord Genuity's U.K and Europe wealth management arm has made $9.3-million, nearly double what the Canadian capital markets business has made.
The announcement of Mr. Davidson's departure was sent out internally on the same day that the dealer shuffled some leaders in its Canadian capital markets arm. These moves follow the October hire of former Scotia Capital executive Pat Burke to run the business that had seen the high-profile departures of former energy banking head Bruce McDonald, global head of investment banking Phil Evershed and Canadian capital markets head Matt Gaasenbeek.
As part of the shuffle, institutional equity sales co-head Graham Saunders is now head of capital markets origination, leaving Jason Melbourne to run the sales desk. In investment banking, Ted Hirst becomes head of resources for Canada, with a particular focus on mining, while Trevor Anderson and Neil Duffy were hired as managing directors in Calgary.
In research, Kelly Bourque is now both a managing director and head of business management.
Tim Kiladze