Value Unleashed

 

Market Update

Sixty-five Canadian M&A transactions closed this past week. Year to date, M&A closed deal count is 4.3% higher than the comparable period in 2016. The Canadian dollar appreciated by 0.60 cents, ending the week at 78 cents. The TSX outperformed the S&P 500 this week by 0.9% in U.S. dollar terms. WTI Crude oil rose by 3.2%, ending the week at $55.64 per barrel.

According to The Lead Left, the total dollar volume of leveraged loans (supply) has failed to keep up with the combined buying capacity (demand) from both loan mutual funds and collateralized loan obligations. As of July 2017, the divergence between supply and demand, was approximately $150 billion, which is the largest in the last 5 years.

 

Valitas Insights: Logistics & M&A – Adaptation and Transformation

Part 1.  An Overview

Whether we realize it or not, the Logistics industry is a key component in our everyday lives. Our grocery stores always have food on the shelves. We rely on full gas pumps to keep our cars running. And when we order novelty products from China, they arrive promptly, right at our doorsteps. Without the Logistics industry, none of this would be possible. On top of this, the emergence of e-commerce and its transformation of the retail market is driving the Logistics industry to adapt to a new life of customized orders with many more end destinations. 

This article serves as the first in our Logistics & M&A series.  Part 1 provides an overview of the sector and historic M&A activity, and subsequent articles will discuss key industry trends. In writing this series, we benefit from the input of Martin Kelly and Keith Hart, industry veterans, who provided insights drawing on their wealth of Logistics experience.

Read our full article to learn more.

And more logistics…

We’ve recently published our quarterly Logistics Industry Snapshot.  If you’d like us to send you a copy, please email insights@valitas.ca.

On other topics…

Did you miss our Canadian M&A Q3 Review?  You can find it on PE HUB or for the full version, on our website.

And finally, don’t miss this article from Firmex: Why Build It When You Can Buy It? Analyzing the AI Acquisition Appetite.

 

Canadian M&A Transactions [i]

Utilities (Announced)

OMERS Infrastructure Management to Acquire Thames Water

OMERS Infrastructure Management Inc., a Canadian principal investment firm specializing in real estate, infrastructure and private equity investments has agreed to acquire Thames Water Utilities Limited, a AMP Capital, BT Pension Scheme, and Desjardins Financial Corporation backed U.K.-based company which provides regulated water and wastewater services. No transaction terms were released.

Utilites (Closed)

Suncor Energy has Acquired Petronor

Suncor Energy Inc. (TSX:SU), a Canadian integrated energy company has acquired Petronor, a Canadian distributor of petroleum products. No transaction terms were released.

Consumer Staples (Announced)

Saputo to Acquire Betin

Saputo Inc. (TSX:SAP), a Canadian company which produces, markets, and distributes various dairy products internationally, has agreed to acquire Betin, Inc., a U.S.-based company which produces and sells goat cheese. No transaction terms were released.

Consumer Staples (Closed)

Lexaria Bioscience has Acquired ViPova Tea

Lexaria Bioscience Corp. (OTCPK:LXRP), a Canadian company which develops and licenses its proprietary technology for improved taste, rapidity, and delivery of bioactive compounds has acquired ViPova Tea, a U.S.-based cannabinoid infused tea producer. Total transaction value is estimated to be $90 thousand.

Materials (Announced)

Sable Resources to Acquire BlueJoint Resources

Sable Resources Ltd. (TSXV:SAE), an RBC Global Asset Management backed Canadian natural resource company which engages in the acquisition, exploration, and development of gold and mineral properties in Western Canada, has agreed to acquire BlueJoint Resources Inc. No transaction terms were released.

Sable Resources to Acquire Western Canada Greenfield

Sable Resources Ltd. (TSXV:SAE), an RBC Global Asset Management backed Canadian natural resource company which engages in the acquisition, exploration, and development of gold mineral properties in Western Canada, has agreed to acquire Western Canada Greenfield Group Inc.. No transaction terms were released.

Kissner Milling Company to Acquire US Salt

Kissner Milling Company Limited, a Metalmark Capital, GoldPoint Partners, and Silverhawk Capital Partners backed Canadian manufacturer and supplier of ice melt products, salts, and plastic products in North America, has agreed to acquire US Salt LLC, a producer of evaporated salt products for industries, farms, and homes in the Americas. No transactions terms were released.  

Cabot Corporation to Acquire Tech Blend

Cabot Corporation (NYSE:CBT), a U.S.-based company which provides specialty chemicals and performance materials has agreed to acquire Tech Blend s.e.c., a Canadian manufacturer of specialty black concentrates and additives for the plastics industry internationally. Total transaction value is estimated to be $82.56 million, at an implied EV/EBITDA multiple of 8.0x.

Fura Gems to Acquire Esmeracol

Fura Gems Inc. (TSXV:FUR), a Pinetree Capital, Resinco Capital Partners, and Scharfe Holdings backed Canadian natural resources company which engages in the acquisition, exploration, and evaluation of properties internationally, has agreed to acquire Esmeracol S.A., a Colombian company which offers emerald exploration services. Total transaction value is estimated to be $16.9 million.

Materials (Closed)

TC Transcontinental Printing has Acquired Flexipak Industries

TC Transcontinental Printing Inc., a Canadian printing and multiplatform solutions provider across North America has acquired Flexipak Industries Inc., a Canadian manufacturer of polybags. No transaction terms were released.

Consumer Discretionary (Closed)

Snakes and Lagers has Acquired Natural Stuff

Snakes and Lagers Inc., a Canadian company which owns and operates board game cafes has acquired Natural Stuff Inc., a Canadian distributor of wellness products. Total transaction value is estimated to be $168 thousand.

Mosaic Capital has Acquired Circle 5 Tool and Mold

Mosaic Capital Corporation (TSX:M), an Alph Investment Corporation backed Canadian private equity and venture capital firm, has acquired Circle 5 Tool and Mold LP, a Canadian provider of injection molded solutions to the automotive industry. Total transaction value is estimated to be $27 million.

Fairchild Media Group has Acquired Sourcing Journal Media

Fairchild Media Group Inc., a U.S.-based Chinese language broadcasting company, operating radio and television networks, has acquired Sourcing Journal Media, LLC, a U.S.-based publisher of trade publications for apparel and textile executives focused on sourcing and manufacturing. No transaction terms were released.

Information Technology (Announced)

Distributel Communications to Acquire Zazeen

Distributel Communications Limited, a Canadian provider of phone services for residential and business subscribers, has agreed to acquire Zazeen Inc., a Canadian telecommunications company and broadcast distribution provider. No transaction terms were released.

InVue Security Products to Acquire MicroSigns

InVue Security Products, Inc., a U.S. based provider of sales enablement solutions for retailers and commercial businesses internationally, has agreed to acquire MicroSigns Inc., a Telesystem Ltd. backed Canadian retail-technology company which designs and manufactures wireless networking and merchandising solutions. No transactions terms were released.

Stompy Bot to Acquire Token Play

Stompy Bot Corporation (DB:S7T), a Canadian video game publisher has agreed to acquire Token Play Inc, a Canadian company involved in the development of blockchain technology in the videogame space for the exchange of in-game currencies and tokens. No transaction terms were released.

TELUS International to Acquire Xavient Information Systems

TELUS International, Inc., a Canadian company which provides contact center, customer care, and business processing solutions has agreed to acquire Xavient Information Systems Inc., an Alta Partners backed U.S.-based provider of information technology consulting and software services. No transaction terms were released. 

360 Blockchain to Acquire SV CryptoLab

360 Blockchain Inc. (CNSX:CODE), a Canadian company which provides insurance, corporate finance, and merchant banking services for individuals and businesses, has agreed to acquire SV CryptoLab, a U.S.-based company focused on blockchain research and cryptocurrency mining. Total transaction value is estimated to be $2 million.

Information Technology (Closed)

SNC-Lavalin Group has Acquired Data Transfer Solutions

SNC-Lavalin Group Inc. (TSX:SNC), a Canadian provider of engineering, construction, and maintenance services internationally, has acquired Data Transfer Solutions LLC, a U.S.-based company which develops and produces software solutions for government and transportation sectors. Total transaction value is estimated to be $58.1 million. 

Web.com Group has Acquired Acquisio

Web.com Group, Inc. (NasdaqGS:WEB), an Okumus Fund Management backed U.S.-based company which provides a range of internet services to small business internationally, has acquired Acquisio, Inc., a Canadian operator of a search marketing platform that offers digital and programmatic marketing solutions. No transaction terms were released.

Healthcare (Announced)

AREV Nutrition Sciences to Acquire Verified Plant Genetics

AREV Nutrition Sciences Inc. (CNSX:ARV), a Chiron Investment Management backed Canadian company which engages in developing a line of natural health products, has agreed to acquire Verified Plant Genetics. No transactions terms were released.

Healthcare (Closed)

Morneau Shepell has Acquired Pro Health Group

Morneau Shepell Inc. (TSX:MSI), a Canadian human resource consulting and technology company, has acquired Pro Health Group Inc., a Canadian developer of employee and family assistance programs. No transaction terms were announced.

Cannabis Wheaton Income has Acquired RockGarden Medicinals

Cannabis Wheaton Income Corp. (TSXV:CBW), a MM Asset Management and Nesta Holding backed Canadian cannabis streaming company, has acquired RockGarden Medicinals Inc., a Canadian producer of cannabis products. Total transaction value is estimated to be $27.5 million.

Industrials (Announced)

LGC Capital to Acquire Etea Sicurezza Group

LGC Capital Ltd. (TSXV:LG), a Canadian investment company, has agreed to acquire Etea Sicurezza Group LTD, a U.K.-based designer and manufacturer of explosion and fire protection equipment. No transaction terms were released.

Industrials (Closed)

Gentherm Canada has Acquired Etratech Enterprises

Gentherm Canada ULC, a developer of automotive thermal management technologies for heating and cooling, and temperature control applications, has acquired Etratech Enterprises, Inc., a SF Fund Management backed Canadian electronics manufacturer that designs, develops, and produces advanced electronic controls for leading OEMs internationally. Total transaction value is estimated to be $81.3 million.

Kryton Canada has Acquired Cementec Industries

Kryton Canada Corporation, a company which develops, manufactures, and markets concrete waterproofing, repair, and protection products to the construction industry internationally has acquired Cementec Industries Inc., a Canadian engineering, production development, and manufacturing company. No transaction terms were released.

Andersen Corporation has Acquired Fenetres MQ

Andersen Corporation, a U.S.-based company which engages in the design, manufacturing, and marketing of windows and doors, has acquired Fenetres MQ Inc., a Canadian company which engages in the design, manufacturing, marketing, and exporting of custom-sized windows and doors.

Ardenton Capital has Acquired Comtrad Strategic Sourcing

Ardenton Capital, a Canadian private equity firm which specializes in buyouts and investments in mid-market companies, has acquired Comtrad Strategic Sourcing Inc., a Tepper Holdings and Roynat Equity Partners backed Canadian company which imports and distributes hardware and component products to furniture, kitchen, and bath cabinet manufacturers and distributors. No transaction terms were released.

WSP Global has Acquired Consultoria Colombiana

WSP Global Inc. (TSX: WSP), a Canadian Pension Plan Investment Board and Caisse de depot et placement du Quebec backed Canadian professional services company has acquired Consultoria Colombiana S.A., a Colombian-based engineering and construction services provider. No transaction terms were released.

Financials (Announced)

People Corporation to Acquire Assurances Dalbec Ltee

People Corporation (TSXV:PEO), a Canadian provider of group benefits, group retirement, and human resource services, has agreed to acquire Assurances Dalbec Ltee, a Canadian provider of Third Party Administrator (TPA) consulting services for employee benefit plans of small and medium-sized companies. Total transaction value is estimated to be $16.1 million.

Energy (Announced)

MatRRix Energy Technologies to Acquire Stampede Drilling

MatRRix Energy Technologies Inc. (TSX:MXX), a Westcap Management backed Canadian company which engages in the acquisition and supply of horizontal and directional drilling technologies for the oil and gas industry in North America, has agreed to acquire Stampede Drilling Ltd., a PFM Capital and SaskWorks Venture Fund backed Canadian oil and gas company. Total transaction value is estimated to be $9.0 million.

CWC Energy Services to Acquire C&J Production Services Canada

CWC Energy Services Corp. (TSX:CWC), a Brookfield Asset Management backed Canadian oilfield services company, has agreed to acquire C&J Production Services Canada Ltd., a provider of oil well services. Total transaction value is estimated to be $37.5 million.

Other (Closed)

SGS Canada has Acquired BioVision Seed Research

SGS Canada Inc., a technical services company which conducts analytical testing across various industries internationally has acquired BioVision Seed Research Ltd., a leading seed, grain and soil testing laboratory serving the agricultural markets in Western Canada. No transaction terms were released.

Wildeboer Dellelce has Acquired WD Numeric Corporate Services

Wildeboer Dellelce LLP, a Canadian provider of legal advisory services has acquired WD Numeric Corporate Services, a Globacor Capital backed Canadian corporate services and bookkeeping company. No transaction terms were released.

          Tervita Corporation has Acquired 3K Oil Services

Tervita Corporation, a BC Investment Management, Goldman Sachs Group, backed Canadian provider of environmental solutions to natural resource and industrial customers across North America has acquired 3K Oil Services Ltd., a Canadian upstream oil waste service provider. No transaction terms were announced.

Altus Group has Acquired CVS

Altus Group Limited (TSX:AIF), a 1832 Asset Management, Connor, Clark & Lunn Investment Management, and Fiera Capital backed Canadian company that provides independent advisory services, software, and data solutions to the commercial real estate industry has acquired CVS Limited, a U.K.-based business rents and rates reduction specialist. Total transaction value is estimated to be $60.7 million.

Summit Liability Solutions has Acquired Remuda Energy Solutions

Summit Liability Solutions Inc., a Canadian environmental consulting and service provider, has acquired Remuda Energy Solutions Ltd., a Canadian company focused on the transportation of crude oil products across North America. No transaction terms were released.

Optimus SBR has Acquired BottomLine Group

Optimus SBR Inc., a Canadian management consulting company providing advisory services across North America, has acquired BottomLine Group Inc., a Canadian provider of business and consulting services. No transaction terms were released.