How a 1925 electric utility firm became a global financial powerhouse
In short: Founded by two stockbrokers to manage Quebec's power lines, Power Corporation of Canada has evolved into a massive international conglomerate. From its origins in electrical utilities to its current dominance in global financial services, the company's trajectory reveals a sophisticated web of holdings spanning North America, Europe, and Asia.
The company's origins date back to 1925, when stockbrokers Arthur J. Nesbitt and Peter A.T. Thomson established it as a holding company. Its initial mission was focused on the electric utility industry, specifically managing investments in the electrical power sectors of Quebec's Eastern Townships and other Canadian provinces like Ontario, Manitoba, New Brunswick, and British Columbia. Its early operations also included interests in the Canadian Oil Companies Ltd. before that business was sold to Shell in 1962. Furthermore, the firm expanded its reach by acquiring a controlling interest in Bathurst Pulp and Paper Company Ltd. during the late 1930s.
A major reorganization occurred in 1968 after Paul Desmarais's group purchased a majority stake from the Nesbitt family. By 1970, the founding family was no longer involved in operations. This transition paved the way for significant expansion. In the 1970s, the group expanded into Europe, followed by expansion into Asia during the 1990s. The company's leadership changed hands in 1952 when Arthur Deane Nesbitt took over as president from his father. Around the turn of the millennium, the group expanded its influence by purchasing Putnam Investments, Mackenzie Financial, and Canada Life.
Today, the conglomerate is deeply embedded in the financial services sector through entities like Power Financial Corporation and IGM Financial. Its diverse portfolio includes insurance, wealth management, and investment management. The company has also moved into the fintech space through ventures like Portage Ventures, Wealthsimple, and Personal Capital. The firm's current structure includes 100% ownership of Power Financial's common shares following a recent reorganization. It also maintains a presence in the emerging fintech industry through its subsidiary, Diagram.
The corporation's influence is often noted through its connections to prominent political figures. Former Canadian prime ministers, such as Paul Martin and Jean Chrétien, have held roles within the company or its subsidiaries. Additionally, the company's international advisory board has included figures like Pierre Trudeau and Helmut Schmidt. The corporation's board has seen significant changes, such as reducing its director count from 21 to 12 in 2008. Additionally, the company has actively participated in the emerging fintech sector through various strategic initiatives.
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- Summary by Intellect · source: Power Corporation of Canada
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