The Desmarais Family and Power Corporation: Quebec’s Quiet Financial Empire

Power Corporation is the rare Canadian dynasty that owns almost nothing it operates. Rather than running stores, refineries or newspapers, the Desmarais family built a holding company that sits above life insurers, mutual fund managers, a European investment group and a fintech, taking dividends and allocating capital while professional managers run each business. The approach survived a 2020 restructuring, a generational handover and the rise of a digital challenger the family happened to own. It is part of the Canada Company Stories hub.

How did Paul Desmarais Sr. build Power Corporation?

Paul Desmarais Sr. was born in Sudbury, Ontario, in 1927 to a French-Canadian family and took over Sudbury Bus Lines, a struggling business his family owned, for a nominal one dollar after leaving the University of Ottawa. He turned it around, bought other bus companies in Quebec and Ontario, and by the 1960s had used the cash flow to acquire stakes in insurance, newspapers and industrial companies through a series of reverse takeovers.

In 1968 his holding company completed a share exchange with Power Corporation of Canada, a Montreal company founded in 1925 by stockbrokers Arthur Nesbitt and Peter Thomson to hold hydroelectric utility investments. Desmarais became chairman and chief executive, and the Nesbitt family stepped away by 1970. Over the following decade he reshaped Power into a financial holding company, attempting a takeover of Argus Corporation in 1975, buying control of Great-West Life and Investors Group, and creating Power Financial Corporation in 1984 to hold the financial services businesses.

His signature was patience and political fluency. Desmarais cultivated friendships across party lines in Ottawa, Quebec City and Paris, bought the Belgian financier Albert Frère’s partnership in Groupe Bruxelles Lambert, and in 2000 added Canada Life, Mackenzie Financial and Putnam Investments to the group. He stepped back from management in 1996, handing the co-chief executive roles to his sons Paul Jr. and André, but remained controlling shareholder until his death at his Sagard estate in Quebec in October 2013.

What was the Desmarais family’s relationship with politics?

Few Canadian business families have been as close to power, in both senses, as the Desmarais clan. Jean Chrétien, prime minister from 1993 to 2003, sat on the board of Power subsidiary Consolidated-Bathurst before entering government; his daughter France is married to André Desmarais. Brian Mulroney, prime minister from 1984 to 1993, had worked as Paul Sr.’s labour lawyer. Paul Martin, prime minister from 2003 to 2006, bought Canada Steamship Lines from Power in 1981 and built his own fortune on it. Pierre Trudeau joined Power’s international advisory board after leaving office.

The connections extended abroad. Nicolas Sarkozy, the future French president, visited the Sagard estate in 2004 and later awarded Paul Sr. the Grand Cross of the Legion of Honour in 2008, crediting him with influencing his career. Power’s 10% stake in China Asset Management, bought from CITIC Securities in 2011, reflected decades of relationship-building in Beijing that began with Paul Sr.’s participation in early Canada-China trade missions.

Critics have long argued that these ties gave the family privileged access, and Power has periodically featured in Quebec sovereignty debates as a symbol of federalist business power. The family’s defence is that it has never sought regulatory favours and that its businesses are highly regulated life insurers and asset managers that compete on product. Whatever the verdict, political access was part of Paul Sr.’s toolkit, and the current generation has been more discreet.

What did the 2020 reorganisation change?

For 36 years Power Corporation sat above Power Financial, which in turn held the stakes in Great-West Lifeco, IGM and Pargesa. The double-decker structure created two sets of public shareholders, two discounts to net asset value and considerable complexity. In December 2019 Power announced it would collapse the structure, and on 13 February 2020 Power Corporation acquired all the Power Financial shares it did not already own in a share exchange, making Power Financial a wholly owned subsidiary.

The same day Paul Desmarais Jr. and André Desmarais retired as co-chief executives after 24 years, becoming chairman and deputy chairman, and Jeffrey Orr, Power Financial’s chief executive since 2005 and IGM’s before that, became president and chief executive of Power Corporation. The reorganisation came with cost cuts, a simplified reporting structure and a commitment to narrow the discount at which Power’s shares traded relative to the value of its holdings.

Over the following years the group also consolidated its European exposure. Pargesa, the Swiss holding company through which Power and the Frère family controlled Groupe Bruxelles Lambert, was folded into GBL in 2020, leaving Power with its 17.1% interest in GBL held through Parjointco, a 50-50 joint venture with the Frère family. The simplification let management focus on three stated priorities: growing the insurance and asset management businesses, building the alternatives platforms Sagard and Power Sustainable, and nurturing the fintech portfolio led by Wealthsimple.

How did Power Corporation perform in 2025 and 2026?

Power reported net earnings from continuing operations of C$2,572 million, or C$4.01 per share, for 2025, and adjusted net earnings of C$3,400 million, or C$5.31 per share, up from C$4.58 in 2024. Adjusted net asset value per share rose 41.9% during the year to C$85.77, driven by the share prices of Great-West Lifeco and IGM Financial and by a sharp mark-up of Wealthsimple. The board raised the quarterly dividend by 9% to 66.75 cents in March 2026, and the company bought back 12.4 million subordinate voting shares for C$711 million during 2025.

The momentum continued into 2026. Second-quarter adjusted net earnings of C$974 million, or C$1.55 per share, were a record, and adjusted net asset value per share reached C$112.94 at 30 June 2026, up a further 31.7% in six months. Great-West Lifeco contributed C$871 million of adjusted earnings in the quarter with a return on equity of 19.3%, while IGM Financial posted record adjusted earnings of C$330 million on assets under management and advisement of C$343.3 billion. Power had returned C$1.5 billion to shareholders in the first half of 2026 through dividends and buybacks.

Behind the headline numbers sits an unusually diversified set of earnings. Great-West Lifeco’s growth increasingly comes from Empower, its US retirement-plan business, which agreed in 2026 to buy Milliman’s retirement administration unit for US$340 million. IGM combines the IG Wealth Management adviser network with Mackenzie Investments and strategic stakes in Wealthsimple, Rockefeller Capital Management and China AMC. The holding company structure means Power’s own results move with the share prices of its listed subsidiaries, which is why net asset value can swing 40% in a year while underlying earnings grow in the mid-teens.

Why does Wealthsimple matter so much to the family?

Wealthsimple is the investment that turned a conservative insurance holding company into a fintech owner. Power Financial invested C$10 million in the Toronto robo-adviser in April 2015, a year after Michael Katchen founded it, with the right to add C$20 million more. Through subsequent rounds Power, IGM and Portage Ventures, Power’s fintech venture arm, became the dominant shareholders. At the end of 2025 Power reported a 52.4% undiluted economic interest, with the group’s fully diluted interest at 40.7%.

The business has grown far beyond robo-advice. Wealthsimple reported 3.6 million clients and C$155.6 billion of assets under administration at 30 June 2026, up 84% in a year, having crossed C$100 billion in October 2025, three years ahead of its own target. It now offers chequing accounts, Visa Infinite credit cards, lines of credit, stock and crypto trading and tax filing, and in October 2025 raised C$750 million at a post-money valuation of C$10 billion in a round co-led by Dragoneer and GIC with CPP Investments as a new investor.

For Power the accounting consequence is large. The group’s Wealthsimple interest was carried at C$3.8 billion at the end of 2025, up from C$2.1 billion a year earlier, and at C$4.7 billion by June 2026. That mark-up is the single biggest reason adjusted net asset value jumped. Strategically, Wealthsimple also gives the family a hedge: if digital platforms take share from IG Wealth’s adviser model or from the big banks, Power owns the disruptor. The Canadian fintech story in this hub explores how the company fits into the country’s open banking debate.

How are Sagard and Power Sustainable building a third leg?

Sagard began in 2002 as a European private equity fund seeded by Power and the Frère family and has become a multi-strategy alternatives manager with C$46.1 billion of assets under management including commitments at the end of 2025, up from C$38.2 billion a year earlier. In April 2026 it completed the acquisition of Unigestion, a Swiss asset manager, lifting assets to about US$46.9 billion. Sagard runs private equity, private credit, real estate, venture capital through Portage and healthcare royalties, and about 92% of the group’s alternatives capital comes from third parties and associated companies rather than Power itself.

Paul Desmarais III, Paul Jr.’s son, is chairman and chief executive of Sagard and has been the public face of the group’s push into alternatives. In May 2026 Power, Great-West Lifeco and IGM announced a joint investment in a new Sagard AI fund, an example of the group using its insurance and wealth balance sheets to seed strategies that Sagard then markets to outside investors.

Power Sustainable, run by Olivier Desmarais, André’s son, manages about C$4.4 billion in renewable energy infrastructure, sustainable agriculture and related strategies. It is smaller but gives the third generation a second operating platform. Together Sagard and Power Sustainable managed C$50.5 billion at the end of 2025, and Power’s stated aim is to turn them into fee-generating businesses whose value is recognised in the share price rather than treated as a cost centre.

How is control passing to the third generation?

The Desmarais family controls Power Corporation through the Pansolo Holding trust, which holds the participating preferred shares that carry ten votes each, giving the family a majority of votes with a minority of the equity. Paul Desmarais Jr., born in 1954, chairs the board; André, born in 1956, is deputy chairman. Both retired from executive roles in 2020, and neither of their sons is being groomed to run Power Corporation itself.

Instead the third generation has been given operating businesses to build. Paul III runs Sagard, Olivier runs Power Sustainable, and the chief executive role at the holding company has gone to professionals: Jeffrey Orr from 2020 to June 2026 and James O’Sullivan from 1 July 2026. O’Sullivan had run IGM Financial for six years, sits on the Great-West Lifeco and Wealthsimple boards and will chair both IGM and Lifeco, concentrating group leadership in one executive while Orr moves to vice-chair.

The division of labour mirrors how the family handled the second generation. Paul Sr. kept control while his sons ran the business as co-chief executives for 24 years, and they in turn hold the chairman roles while their sons build the alternatives platforms. Compared with the Irving family, whose branches split the empire after the founder’s death, or the Westons, who pass control to one heir, the Desmarais model keeps the family united around a single holding company while distributing roles.

What are the risks in the Power model?

The holding company discount is the structural problem. Power’s shares have historically traded below the sum of its stakes in Lifeco, IGM, GBL and the private assets, and management has spent six years trying to narrow the gap through buybacks, simplification and clearer disclosure. The 2025-26 surge in net asset value per share, driven by financial stocks and the Wealthsimple mark-up, reduced the discount but did not remove the question of why investors should pay for a holding layer rather than buying Lifeco directly.

The second risk is concentration in interest-rate-sensitive financials. Great-West Lifeco and IGM together generate most of Power’s cash, and both are exposed to equity markets, credit spreads and, in Empower’s case, US retirement regulation. GBL, the European holding, has had a mixed record and in 2026 was engaged in a leveraged tender offer for Italian pharmaceutical group Recordati alongside CVC. Private valuations at Sagard and Wealthsimple can also fall as fast as they rose.

How does Power compare with other Canadian financial dynasties?

Power is closer to a European family holding company such as Belgium’s GBL or Sweden’s Investor AB than to the operating dynasties that dominate Canadian business. It does not manufacture, retail or extract; it allocates. That has made it a less visible but more diversified fortune than the Westons’ grocery empire or the Thomsons’ single-company bet.

The comparison with Canada’s big six banks is instructive. The banks own the dominant wealth, insurance and brokerage franchises and enjoy regulatory protection; Power has built the largest non-bank alternative in Canadian wealth management by combining an adviser network, a mutual fund house and a digital challenger. If open banking and payments modernisation give non-banks fairer access to the system, Power’s Wealthsimple position becomes more valuable; if the banks retain their advantages, IGM and Lifeco remain steady dividend payers.

Montreal itself benefits. Power is one of the last large Canadian financial groups headquartered in Quebec, and its family’s philanthropy, political connections and support for French-language institutions make it a pillar of the province’s business establishment in a way the Toronto-based banks are not.

What can founders and investors learn from the Desmarais family?

The first lesson is the value of separating ownership from operation. Paul Sr. never ran an insurance company; he bought control of good ones and let managers run them while he allocated capital and managed relationships. His sons followed the model, and the third generation has been given businesses to build rather than a conglomerate to inherit. Founders who want a multi-generational enterprise should ask whether their children need to be operators or owners.

The second lesson is simplification. The 2020 collapse of Power Financial into Power Corporation removed a layer of cost and confusion that had persisted for 36 years. Holding structures accumulate complexity for tax and historical reasons, and the discipline to dismantle them is rarer than the ambition to build them.

The third lesson is that patient capital can fund disruption of your own business. Power’s C$30 million Series A commitment to Wealthsimple in 2015 looked like a small hedge; by 2026 it was worth C$4.7 billion and had become the group’s growth engine. Investors should look for incumbents that are genuinely willing to back their own challengers.

Finally, succession in a holding company is about governance, not genes. The family has twice hired professional chief executives while keeping board control, and both transitions were announced months ahead with clear timelines. That is the opposite of the sudden, contested handovers that have damaged other dynasties.

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