Value Unleashed

Market Update

Thirty Canadian M&A transactions closed this past week. Year to date, M&A closed deal count is down 14.5% than the comparable period in 2017. The Canadian dollar depreciated by 1.31 cents, ending the week at 79 cents. The TSX underperformed the S&P 500 by 0.1% in U.S. dollar terms. WTI Crude oil fell by 9.9%, ending the week at $58.99 per barrel.

According to The Lead Left, the buy-and-build model is popular in the PE industry. Investors’ appetite for add-ons stretches back about a decade, but most of the increase has taken place in the middle market, specifically at the lower end. Following the financial crisis, lower and core-middle-market add-on activity exploded by volume, peaking in counts in 2015 and 2014, respectively. Furthermore, upper-middle-market add-on activity is now nearing its all-time high, surpassing its 2015 peak.  

Canadian M&A Transactions[i]

Energy (Announced)

Wolf Midstream to Acquire Access Pipeline

Wolf Midstream Inc., a Canada Pension Plan Investment Board-backed Canadian company that offers origination and execution of greenfield energy infrastructure projects in Western Canada, has agreed to acquire Access Pipeline Inc., a Canadian company that operates a heavy oil transportation pipeline network that services facilities in the northeastern region of Alberta. Access Pipeline Inc. is a subsidiary of MEG Energy Corp (TSX:MEG). Total transaction value is estimated to be $1.31 billion, reflecting a 13.4x EBITDA multiple.

Suncor Energy to Acquire Canbriam Energy

Suncor Energy Inc. (TSX:SU), a Canadian company that operates as an integrated energy company, has agreed to acquire Canbriam Energy Inc., a Warburg Pincus, BlackRock, ARC Financial, State Street Global Advisors, and Teachers' Private Capital-backed Canadian company that operates as an exploration and production company with a focus on natural gas, natural gas liquids, and oil plays in the BC Montney region. Total transaction value is estimated to be $52.0 million.

Industrials (Closed)

BaleForce Recycling Equipment has Acquired Ready Machinery & Equipment

BaleForce Recycling Equipment Inc., a Canadian, wholly owned subsidiary of Metro Group of Companies that manufactures recycling and waste equipment, has acquired Ready Machinery & Equipment (Canada) Inc., an equipment moving company offering transportation, storage, staging, and installation of heavy equipment and machinery. No transaction terms were released.

EnGlobe has Acquired Crandall Engineering

EnGlobe Corp., an Onex Corporation and-ONCAP Management Partners-backed Canadian company that provides soil, materials, and environmental engineering services clients internationally, has acquired Crandall Engineering Ltd., a Canadian company that provides engineering solutions for municipal, water/wastewater, transportation, land development, and building mechanical and electrical services. No transaction terms were released.

Consumer Discretionary (Announced)

Demers Ambulances to Acquire Braun Industries

Demers Manufacturier Ambulances Inc., a CDPQ, Clearspring Capital Partners, and Westerkirk Capital-backed Canadian manufacturer of ambulances in North America, has agreed to acquire Braun Industries, Inc., a U.S-based company that designs and manufactures custom ambulances. No transaction terms were released.

Teldon Media Group to Acquire By Design Publishing

Teldon Media Group, a Canadian company that provides printing services in Western Canada, has agreed to acquire By Design Publishing Inc., a U.S-based company that provides client communication and personal marketing for real estate professionals. No transaction terms were released.

Consumer Discretionary (Closed)

Ultimate Support Systems and Regimen Equity Partners have Acquired Radial Engineering

Ultimate Support Systems Inc., a company that specializes in designing and manufacturing music equipment, in a venture with Regimen Equity Partners, has acquired Radial Engineering Ltd., a Canadian company that manufactures and distributes professional audio products. No transaction terms were released.

Consumer Staples (Closed)

Ocean Spray Cranberries has Acquired Atoka Cranberries

Ocean Spray Cranberries Inc., a Ben Franklin Technology Partners-backed U.S-based business and agricultural cooperative of cranberry and grapefruit growers in North America and Chile, has acquired Atoka Cranberries Inc., a Canadian company that offers cranberry farming, processing, and packaging services. Atoka Cranberries Inc. is an operating subsidiary of Canneberges Bieler Inc. No transaction terms were released.

Healthcare (Announced)

Rapid Dose Therapeutics to Acquire ACME Resources

Rapid Dose Therapeutics Inc., a Canadian bio-technology company that provides proprietary drug delivery technologies, has agreed to acquire ACME Resources Corp. (TSXV:ACY.H), a Canadian company with no significant operations. No transaction terms were released.

Venus Concept Canada to Acquire NeoGraft Solutions

Venus Concept Canada Corp., an EW Healthcare Partners, Aperture Venture Partners, Longitude Capital, and HealthQuest Capital-backed company that provides medical aesthetic solutions globally, has agreed to acquire NeoGraft Solutions Inc., a U.S-based company focusing on hair restoration technology development and topical products. No transaction terms were released.

Healthcare (Closed)

Ravenquest Biomed has Acquired Alberta Green Biotech

Ravenquest Biomed Inc. (TSXV:RQB), a Canadian cannabis production, management services, and consulting company has acquired Alberta Green Biotech Inc., a medical marijuana producer. Total transaction value is estimated to be $13.0 thousand.

Canadian Cultivated Products has Acquired Canada's Island Garden

Canadian Cultivated Products Ltd., a subsidiary of Alliance One International Inc. (NYSE:AOI), has acquired Canada's Island Garden Inc., a company that produces and sells medicinal cannabis. No transaction terms were released.

Aleafia has Acquired AeroFarms Canada

Aleafia Inc., a Canadian company that owns and operates healthcare clinics that provide medical cannabis therapy, has acquired AeroFarms Canada, a cultivator and producer of medical marijuana. No transaction terms were released.

Canadian Cultivated Products has Acquired Goldleaf Pharm

Canadian Cultivated Products Ltd., a subsidiary of Alliance One International Inc. (NYSE:AOI) that provides agronomy services to crop and medicinal cannabis growers, has acquired Goldleaf Pharm Inc., a Canadian company that produces and sells medicinal cannabis in Canada. No transaction terms were released.

Financials (Closed)

HUB International has Acquired Kindersley Insurance

HUB International Limited, an AlpInvest Partners and Hellman & Friedman-backed American global insurance brokerage, has acquired Kindersley Insurance Ltd., a Canadian full-service insurance brokerage company. No transaction terms were released.

BDO Canada has Acquired Ferguson + Mak

BDO Canada LLP, a company specializing in auditing, accounting, tax, financial, and management advisory services, has acquired Ferguson + Mak LLP, a Canadian forensic accounting firm with additional services in corporate investigation, litigation and dispute resolution, and economic loss calculations. No transaction terms were released.

Westland Insurance Group has Acquired Cafferky Gilding Insurance Brokers

Westland Insurance Group Ltd., a Canadian insurance brokerage that provides personal and commercial insurance products to individuals, businesses, and non-profit organizations, has acquired Cafferky Gilding Insurance Brokers, a Canadian insurance brokerage focused on personal, commercial, and auto insurance. No transaction terms were released.

Information Technology (Announced)

Victory Square Technologies to Acquire PayVida Solutions

Victory Square Technologies Inc. (CNSX:VST), a Canadian venture capital fund specializing in blockchain, has agreed to acquire PayVida Solutions Inc., a Canadian payment processing company with a global payment facilitation platform that enables merchants to receive same day funding of daily credit and debit card transactions. Total transaction value is estimated to be $2.01 million.

EVI Global Group Developments to Acquire CashTeleport

EVI Global Group Developments Corp. (CNSX:EVI), a Canadian natural resources company focused on the acquisition, exploration, and development of mineral properties in British Columbia, has agreed to acquire CashTeleport Inc., a Canadian company that owns and operates a global blockchain payments and funds transfer platform. Total transaction value is estimated to be $5.53 million.

DigiCrypts Blockchain Solutions to Acquire TJR Coatings

DigiCrypts Blockchain Solutions, a Canadian company that focuses on the business applications within the crypto coin and blockchain industries, has agreed to acquire TJR Coatings Inc., a Canadian company with no current operations. Total transaction value is estimated to be $1.0 million.

Information Technology (Closed)

Converge Technology Partners has Acquired Becker-Carroll

Converge Technology Partners Inc., a Canadian company that is developing a national platform of regionally focused IT infrastructure firms in North America, has acquired Becker-Carroll, a Canadian company that develops the blockchain-based technology Hyperledger Indy, which enables enterprise applications and services to participate in digital, centralized identity ecosystems. No transaction terms were released.

Valsoft has Acquired Welcome Systems

Valsoft Corporation Inc., a Canadian investment firm focused on software companies, has acquired Welcome Systems Limited, a U.K-based leading provider of hotel management and hospitality software. No transaction terms were released.

Fusion Agiletech Partners has Acquired Quisitive

Fusion Agiletech Partners Inc., a Canadian IT consulting firm focused on Microsoft services and innovative technology, has acquired Quisitive LLC, a U.S-based full-service Microsoft-focused IT consulting firm with blockchain service offerings. No transaction terms were released.

JDM Technology Group has Acquired CostCon

JDM Technology Group Inc., a Canadian company that provides business software systems for the architecture, engineering, and construction industries, has acquired CostCon New Zealand Limited, a fully integrated accounting ERP and job costing system provider for contractors. No transaction terms were released.

Firebolt Group has Acquired Envisage Engagement Technologies

Firebolt Group Inc., a U.S-based company that manufactures LED signs and digital display products, has acquired Envisage Engagement Technologies, a Canadian company that develops and operates Engage360, a platform that assists brands, marketing agencies, and enterprises with acquisition, engagement, and conversion of consumer interactions through live channel marketing. No transaction terms were released.

Other (Announced)

Green Valley Mine to Acquire Miningsky Technology

Green Valley Mine Incorporated (TSXV:GVY), a Canadian natural resource company engaged in the acquisition, exploration, and development of mineral resource properties, has agreed to acquire Miningsky Technology Ltd., a Canadian company involved in designing and manufacturing technological infrastructure focused on blockchain. No transaction terms were released.

Other (Closed)

SMT Scharf has Acquired RDH Mining Equipment

SMT Scharf Corporation, a wholly owned Canadian subsidiary of SMT Scharf AG, a company that engages in transport solutions and underground logistics systems, has acquired RDH Mining Equipment Ltd., a Canadian company specializing in high-quality underground equipment for mining and tunnel construction. Total transaction value is estimated to be $8.0 million, reflecting a 0.55x revenue multiple.

ENGIE Services has Acquired PBW High Voltage

ENGIE Services Inc., a Canadian provider of energy efficiency and facility management services and outsourcing for companies in North America, has acquired PBW High Voltage Ltd, a Canadian company specializing in the design and construction of voltage substations and distribution systems. No transaction terms were released.

Dane Creek Capital has Acquired Pets4Life

Dane Creek Capital Corp., a Canadian private equity firm specializing in the pet industry, has acquired Pets4Life, a Canadian manufacturer of high quality, raw pet food. The purchase price reflected a 0.6x revenue multiple. No other transaction details were released.