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Canadian Market Recap: Week Ended December 15

  • Posted By: Topher Abt, Clear Li, Anwar Khan, Steven McMaster, Ty Wilson and Paris Aden

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  • Comments: 2

 

Market Update

Forty-Four Canadian M&A transactions closed this past week. Year to date, M&A closed deal count is 5.9% higher than the comparable period in 2016. The Canadian dollar appreciated by 0.30 cents, ending the week at 78 cents relative to the U.S. dollar. The TSX underperformed the S&P 500 by 0.9% in U.S. dollar terms. WTI Crude oil fell by 0.2%, ending the week at $57.33 per barrel.                     

According to The Lead Left, a record 52% of all middle market buyout financings in 2017 were leveraged at or more than six times EBITDA, which is 15% more than financings which were leveraged at greater than seven times.

 

Valitas Insights: Leveraging Representations and Warranties Insurance in M&A Negotiations

Representations and warranties insurance has proliferated throughout the Canadian M&A marketplace in recent years as a tactical tool for M&A negotiations. We explore the impact that these insurance policies have in M&A negotiations and why some sellers make them a requirement in competitive auctions.

Read our full article here to find out more.

And on other topics…

This Norton Rose Fulbright article draws on the insights of Paris Aden to discuss the importance of sell-side due diligence.

This piece from Nicole Edwards at Firmex discusses how the evolving shopping habits of consumers are shaping the M&A fashion landscape.

 

Canadian M&A Transactions [i]

Materials (Announced)

Azincourt Energy to Acquire Canadian Lithium Development

Azincourt Energy Corp. (TSXV:AAZ), a Canadian alternative energy exploration and development company, has agreed to acquire Canadian Lithium Development, a mineral exploration company. Total transaction value is estimated to be $345 thousand.

International Prospect Ventures to Acquire Valroc Ventures

International Prospect Ventures Ltd. (TSXV:IZZ), a Canadian mineral exploration company, has agreed to acquire Valroc Ventures Pty Ltd, an Australian company that holds applications for mining tenements in the gold-bearing Pilbara region of Western Australia. Total transaction value is estimated to be $424 thousand.

Materials (Closed)

International Cobalt has Acquired 1142888 BC

International Cobalt Corp. (CNSX:CO), a Canadian company that engages in the exploration and development of mineral properties in Canada, has acquired 1142888 BC Limited, a Canadian owner of mineralized deposits of cobalt and copper. Total transaction value is estimated to be $3.72 million.

Industrials (Announced)

Linamar to Acquire MacDon Industries

Linamar Corporation (TSX:LNR), a Canadian company that manufactures and sells precision metallic components, modules, and systems internationally, has agreed to acquire MacDon Industries Ltd., a Canadian designer, manufacturer, and distributer of harvesting equipment. Total transaction value is estimated to be $1.2 billion, reflecting a 2x revenue multiple.

Consumer Discretionary (Announced)

Maple Leaf Sports & Entertainment to Acquire Toronto Argonauts Football Club

Maple Leaf Sports & Entertainment Ltd., a Canadian company that owns and operates hockey, basketball, and soccer teams, has agreed to acquire Toronto Argonauts Football Club Inc., a Kilmer Van Nostrand backed CFL football team. No transaction terms were released.

Onex to Acquire SMG

Onex Corporation (TSX:ONEX), a Canadian private equity firm, has agreed to acquire SMG, a Northlane Capital Partners backed U.S. Company that provides public facility management services internationally. No transaction terms were released.

Dalian Yueban Travel to Acquire Star East Travel

Dalian Yueban Travel Co., Ltd., a Chinese company that offers customized tours and migration services, has agreed to acquire Star East Travel, a Canadian travel agency. Total transaction value is estimated to be $1.2 million.

Consumer Discretionary (Closed)

Imagination Park Entertainment has Acquired Prodigy Films

Imagination Park Entertainment Inc. (CNSX:IP), a Canadian digital content production company, has acquired Prodigy Films Inc., a U.S. movie production company. Total transaction value is estimated to be $46 thousand.

Consumer Staples (Closed)

Knowlton Development has Acquired Northern Labs

Knowlton Development Corporation, a Novacap, Caisse de dépôt et placement du Québec, Fondaction, Fonds de solidarité FTQ, EDC Equity and Investissement Québec backed Canadian manufacturer and custom formulator for the consumer goods industry internationally, has acquired Northern Labs, Inc., a U.S. manufacturer of liquid and paste solutions. No transaction terms were released.

Richardson Pioneer has Acquired Bestland Air

Richardson Pioneer Limited, a Canadian company that offers seed selection, crop planning, and agronomic support services, has acquired Bestland Air Ltd., a Canadian crop inputs retailor and crop application services company. No transaction terms were released.

Healthcare (Announced)

ABcann Global to Acquire Harvest Medicine

ABcann Global Corporation (TSXV:ABCN), a Canadian manufacturer and distributer of medical cannabis, has agreed to acquire Harvest Medicine Inc., a Canadian company that operates a cannabis discovery center and clinic. Total transaction value is estimated to be $3.0 million.

CEN Biotech to Acquire Cen Biotech Ukraine

CEN Biotech, Inc., a Canadian early stage biopharmaceutical company that intends to grow, sell, process, and deliver pharmaceutical grade medical marijuana, has agreed to acquire CEN Biotech Ukraine LLC, a hemp researcher and producer. Total transaction value is estimated to be $423 million.

Financials (Announced)

Qtrade Canada to Acquire Credential Financial

Qtrade Canada Inc., a company that offers online securities brokerage and wealth management services, has agreed to acquire Credential Financial Inc., a Canadian wealth management firm providing dealer services, online brokerage, and insurance solutions. No transaction terms were released.

Financials (Closed)

Wealthica Financial Technology has Acquired StockChase

Wealthica Financial Technology Inc., a Canadian developer of an investment portfolio API, has acquired StockChase Inc., a Canadian company that operates an online investment tool that compiles expert comments on stocks. No transaction terms were released.

Information Technology (Announced)

MGX Minerals to Acquire ZINCNYX Energy Solutions

MGX Minerals Inc. (DB:1MG), a Canadian exploration stage company that engages in acquisition, exploration and development of mineral resource properties, has agreed to acquire ZINCNYX Energy Solutions Inc., a Canadian developer of a zinc-air flow battery system that delivers backup power. Total transaction value is estimated to be $1.7 million.

Datametrex AI to Acquire Ronin Blockchain

Datametrex AI Limited (TSXV:DM), a Canadian company that focuses on the collection of big data from retail point of sale terminals, has agreed to acquire Ronin Blockchain Corp., a Canadian Blockchain platform with a focus in mining cryptocurrencies. Total transaction value is estimated to be $10 million.

Information Technology (Closed)

Jonas Operating Group has Acquired Automatic Netware

Jonas Operating Group, a Canadian company that owns and operates software companies worldwide, has acquired Automatic Netware Ltd, an Irish operator of a platform called Bookassist that provides booking, digital marketing, web design and distribution management technology solutions for the hospitality industry. No transaction terms were released.

Corel has Acquired ClearSlide

Corel Corporation, a Canadian graphics, productivity, and digital media software company, has acquired ClearSlide, Inc., a U.S. provider of web-based sales management and online presentation tools. No transaction terms were released.

ITG Software has Acquired Cenersys

ITG Software Inc., a Canadian software-as-a-service provider of an IT documentation platform, has acquired Cenersys, LLC, a U.S. based provider of appliance network monitoring solutions. No transaction terms were released.

Utilities (Announced)

Alectra to Acquire Guelph Hydro Electric Systems

Alectra Inc., a Canadian distributer of electricity in the Greater Golden Horseshoe Area, has agreed to acquire Guelph Hydro Electric Systems Inc., a distributer of electricity in the city of Guelph. No transaction terms were released.

Other (Announced)

Goldrea Resources to Acquire Tabu Equity Investments

Goldrea Resources Corp. (OTCPK: GORA.F), a Canadian company that engages in the acquisition, exploration, and development of mineral properties in North America, has agreed to acquire Tabu Equity Investments Inc., a Canadian cannabis investment company. No transaction terms were released.

Other (Closed)

Financeit Canada has Acquired Centah

Financeit Canada Inc., a Goldman Sachs, TTV Capital, IA Capital Group, The Pritzker Organization, Second City Capital Partners and DNS Capital backed company that provides a platform for  businesses to offer consumer financing, has acquired Centah Inc., a U.S. based software-as-a-service provider of business management solutions. No transaction terms were released.

RSM International has Acquired Collins Barrow Nova Scotia

RSM International Ltd., a U.S. audit, tax and consulting company, has acquired Collins Barrow Nova Scotia Inc., a Canadian company that provides accounting, tax, and business consulting solutions. No transaction terms were released.

 


[i] Includes all M&A transactions in which either the target or buyer is a Canadian private company.

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