Value Unleashed

Market Update

Forty-three Canadian M&A transactions closed this past week. Year to date, M&A closed deal count is 9.1% lower than the comparable period in 2017. The Canadian dollar appreciated by 0.50 cents, ending the week at 77 cents. The TSX outperformed the S&P 500 by 0.1% in U.S. dollar terms. WTI Crude oil fell by 0.3%, ending the week at $68.49 per barrel.

According to the Lead Left, the middle market is still hot when it comes to LBO activity despite the numbers. From 2004 to 2008, before the credit crisis, approximately 65 to 80% of syndicated LBOs financed were for middle market issuers rather than large corporate issuers. That same figure has declined to 50% for 2018.

Canadian M&A Transactions[i]

Energy (Announced)

Pacific Energy Development to Acquire Producing Assets of Hunter Oil

Pacific Energy Development Corp., a U.S.-based company that operates as a subsidiary of PEDEVCO Corp., has agreed to acquire all the producing assets of Hunter Oil Corp., a Canadian company that is comprised of crude oil and natural gas properties. Total transaction value is estimated to be $27.71 million.

Energy (Closed)

Aspenleaf Energy has Acquired NEP Canada

Aspenleaf Energy Ltd., a Canadian oil and gas production company, has acquired NEP Canada ULC., a company that is engaged in the drilling and production of oil fields in the Western Canadian Basin. No transaction terms were released.

Materials (Closed)

Canstar Resources has Acquired Adventus Newfoundland

Canstar Resources Inc. (TSXV:ROX), a Canadian junior resource company that focuses primarily on the acquisition, exploration, and development of mineral properties in Canada, has acquired Adventus Newfoundland Corp., a company that provides zinc exploration services in Newfoundland. Total transaction value is estimated to be $5.20 million.

Industrials (Closed)

The Butcher Engineering Enterprises has Acquired Autrans Ingersoll

The Butcher Engineering Enterprises Ltd., a Canadian company that engages in the packaging, painting, warehousing, transportation, and distribution of parts for the automotive industry, has acquired Autrans Ingersoll, a Canadian company that operates as a third party just-in-time and just-in-sequence assembler of front-end sub-frame assemblies. No transaction terms were released.

Consumer Discretionary (Announced)

Deluxe’s Method Studios to Acquire Atomic Fiction Canada

Method Studios, a U.S.-based visual effects company owned by Deluxe Entertainment Services Group Inc., has agreed to acquire Atomic Fiction Canada Inc., a company that operates as a visual effects media company. No transaction terms were released.

Consumer Discretionary (Closed)

Stingray Digital Group has Acquired Novramedia

Stingray Digital Group Inc. (TSX:RAY.A), a Canadian company that provides business-to-business multi-platform music, and in-store music and video solutions to businesses and individuals worldwide, has acquired Novramedia Inc., a Canadian digital media company that provides digital signage, application development, content management, and creative services. No transaction terms were released.

Avenir Global has Acquired Padilla

Avenir Global Inc., a Canadian holding and management company that operates public relations and communication companies, has acquired Padilla, a U.S.-based company that provides public relations and communication services. No transaction terms were released.

Gibraltar & Company has Acquired Tilley Endurables

Gibraltar & Company, a Canadian principal investment firm, has acquired Tilley Endurables Inc., a Hilco Capital backed Canadian company that designs and manufactures hats and travel clothing. No transaction terms were released.

Consumer Staples (Closed)

Premium Brands Holdings has Acquired Yorkshire Valley Farms

Premium Brands Holdings Corp. (TSX:PBH), a Canadian company that through its subsidiaries, manufactures and distributes food products primarily in Canada and the United States, has acquired Yorkshire Valley Farms Ltd., a Canadian company that processes and distributes organic chicken products. No transaction terms were released.

Healthcare (Announced)

Breathtec Biomedical to Acquire NASH Pharmaceuticals

Breathtec Biomedical, Inc. (CNSX:BTH), a Canadian company that operates as a medical diagnostics company, has agreed to acquire NASH Pharmaceuticals Inc., a BullRun Capital Inc. backed Canadian company that develops novel cannabinoid-related and other therapies for patients diagnosed with non-alcoholic fatty liver disease and non-alcoholic steatosis. Total transaction value is estimated to be $2.37 million.

Scythian Biosciences to Acquire CannCure Investments

Scythian Biosciences Corp. (TSXV:SCYB), a Canadian company that engages in the research and development of cannabinoid-based combination drug therapies for the treatment of concussions and traumatic brain injury, has agreed to acquire CannCure Investments Inc., a Canadian cannabis producer. Total transaction value is estimated to be $93.3 million.

VIVO Cannabis to Acquire Canna Farms

VIVO Cannabis Inc. (TSXV:ABCN), a Canadian company that manufactures and distributes medical cannabis, has agreed to acquire Canna Farms Ltd., a Canadian company that engages in the production of cannabis. Total transaction value is estimated to be $127 million, implying a 29.6x EBITDA multiple and a 13.6x revenue multiple.

Healthcare (Closed)

AbCellera Biologics has Acquired Lineage Biosciences

AbCellera Biologics Inc., a Canadian company that offers development of antibody therapeutics to improve patient outcomes, has acquired Lineage Biosciences Inc., a U.S.-based company that provides technology for the profiling of antibody responses using the sequencing of immunoglobulin genes. No transaction terms were released.

Information Technology (Announced)

Xero to Acquire Hubdoc

Xero Ltd. (ASX:XRO), a New Zealand software as a service company, has agreed to acquire Hubdoc Inc., a BDC Venture Capital, Hedgewood Inc., Hyde Park Venture Partners and Round 13 Capital backed Canadian company that develops a mobile application that converts receipts, bills, invoices, and statements into usable data. Total transaction value is estimated to be $91.16 million.

Information Technology (Closed)

AXS Blockchain Solutions has Acquired Chainlinks Lab

AXS Blockchain Solutions Inc. (CNSX:BAXS), a Canadian company that provides blockchain consulting and development services in Canada, has acquired Chainlinks Lab Inc., a Canadian company that implements blockchain solutions in telecommunications, logistics, payment, and billing systems. Total transaction value is estimated to be $4.0 million.

Utilities (Announced)

Hydro One to Acquire Business and Distribution Assets of Peterborough Distribution

Hydro One Inc., a Canadian company that together with its subsidiaries, transmits and distributes electricity in Ontario, has agreed to acquire business and distribution assets of Peterborough Distribution Inc., a Canadian company that distributes electricity in Peterborough, Lakefield and Norwood. Total transaction value is estimated to be $105 million.

Real Estate (Closed)

Jones Lang LaSalle has Acquired Northwest Atlantic

Jones Lang LaSalle Inc. (NYSE:JLL), a U.S.-based professional services company that provides commercial real estate and investment management services worldwide, has acquired Northwest Atlantic Inc., a Canadian retail real estate consulting firm. No transaction terms were released.

Other (Closed)

People has Acquired Silverberg & Associates

People Corp. (TSXV:PEO), a Canadian company that provides group benefits, group retirement, and human resource services in Canada, has acquired Silverberg & Associates Inc., a Canadian company that engages in the design, implementation, and ongoing management of employee benefit plans. Total transaction value is estimated to be $29.0 million.

OUTtv Network has Acquired Pro-Fun Media

OUTtv Network Inc., a Canadian company that owns and operates Lesbian, Gay, Bisexual, Trans, and Queer television network in Canada, has acquired Pro-Fun Media GmbH., a gay and lesbian media company. No transaction terms were released.

Dye & Durham has Acquired ESI Software

Dye & Durham Corp., a Plantro Ltd. and Seastone Investments Ltd. backed Canadian company that engages in the development and marketing of cloud-based software applications and services related to the transfer of real estate in Canada, has acquired ESI Software Inc., a Canadian that provides software for law firms and operates as a subsidiary of Dye & Durham Corp.. No transaction terms were released.

Evergreen Pacific Insurance has Acquired Revolution Insurance Services

Evergreen Pacific Insurance Corp., a Canadian company that operates as a financial-services holding company which engages in designing, developing, and distributing insurance products and risk management solutions, has acquired Revolution Insurance Services Inc., a Canadian insurance company that offers life, accidental, and sickness insurance services. No transaction terms were released.