Value Unleashed

Market Update

Fifty-eight Canadian M&A transactions closed this past week. Year to date, M&A closed deal count is 2.7% higher than the comparable period in 2016. The Canadian dollar depreciated by 0.76 cents, ending the week at 79 cents. The TSX underperformed the S&P 500 by 1.5% in U.S. dollar terms. WTI Crude oil rose by 0.2%, ending the week at $51.84 per barrel.

According to The Lead Left, covenant-lite and other leveraged lending terms are no longer bestowed on only “the best and the brightest borrowers”, the result of heated competition amongst midcap lenders.  Larger investment banks are also becoming more frequent sources of capital, heightening competition further, as sponsors are looking to squeeze out an extra 25 bps in pricing or the last quarter-turn of leverage.

Valitas Insights: Canadian M&A – Our Q3 2017 Review

Canadian M&A deal value plummeted in Q3 2017, but we don’t see this as a signal that buyers are running for the hills…at least not in the Canadian middle market. We explore this and other themes, as we take a closer look at Canadian M&A announced deal activity for Q3 2017 and for the first nine months of this year.

We also share a few expert insights on Canadian mid-market M&A from Mario Nigro, a partner in the Merger & Acquisitions and Private Equity & Venture Capital Groups at law firm, Stikeman Elliott, and Jason Bullen, a partner in the Business Law Group and Chair of the Private Equity Group at Cassels Brock.

Read our full article here to find out more.

Canadian M&A Transactions[i]

Energy (Announced)

Frontera Energy to Acquire Pacific Midstream Holding

Frontera Energy Corporation (TSX:FEC), a Canadian company that explores, develops, and produces crude oil and natural gas primarily in Colombia, Guyana, Peru, Guatemala, Brazil, and Belize, has agreed to acquire Pacific Midstream Holding Corp., an International Finance Corporation and IFC Asset Management Company, LLC backed Canadian company that owns and operates oil pipeline and electrical power transmission lines. Total transaction value is estimated to be $281 million.

Energy (Closed)

Innova Global has Acquired Braden

Innova Global Ltd., a Canadian company that provides engineering, fabrication, and construction services, has acquired Braden, an American company that operates under Global Power Equipment Group Limited. No transaction terms were released.

Industrials (Announced)

ACR Electronics to Acquire SkyTrac Systems

ACR Electronics, Inc., an American company that designs and manufactures rescue beacons and survival gear for marine, aviation, outdoor, and military markets, has agreed to acquire SkyTrac Systems Ltd., a Ben Franklin Technology Partners of Northeastern Pennsylvania, Investment Arm and Roynat Equity Partners backed Canadian company that develops and commercializes flight following, flight data, and communication technology solutions for the aviation industry in Canada and internationally. No transaction terms were released.

Founders Advantage Capital to Acquire Astley Gilbert

Founders Advantage Capital Corp. (TSXV:FCF), a Canadian company that operates as an investment issuer, has agreed to acquire Astley Gilbert Limited, a Canadian company that provides print and imaging solutions to businesses across various industries. Total transaction value is estimated to be $24.7 million.

Airbus SE to Acquire C Series Aircraft Limited Partnership

Airbus SE (ENXTPA:AIR), a Netherlands based company active in the aerospace and defense industry that, through its subsidiaries, provides aeronautics, space, and related products and services worldwide, has agreed to acquire C Series Aircraft Limited Partnership, a Canadian company that manufactures aircraft components. No transaction terms were released.

Industrials (Closed)

Freight Brokers International has Acquired Consolidated Carriers

Freight Brokers International Corp., a Canadian company that provides commercial transportation and logistic services, has acquired Consolidated Carriers Inc., a Canadian company that operates as a non-asset-based freight broker. No transaction terms were released.

Consumer Discretionary (Announced)

AutoCanada to Acquire Planète Mazda

AutoCanada Inc. (TSX:ACQ), a Canadian company that through its subsidiaries, operates franchised automobile dealerships in Canada, has agreed to acquire Planète Mazda, a Canadian company that owns and operates an automobile dealership. No transaction terms were released.

Cara Operations to Acquire Pickle Barrel Group of Restaurants

Cara Operations Limited (TSX:CARA), a Canadian company that operates and franchises full service restaurants, has agreed to acquire Pickle Barrel Group of Restaurants, a Canadian company that owns and operates a chain of restaurants and bars. No transaction terms were released.

Healthcare (Closed)

Terra Health Network has Acquired Canna Relief Consulting Canada

Terra Health Network Inc., a Canadian company that provides educational materials and resources to facilitate the prescription process for medical cannabis to resident doctors and healthcare practitioners, has acquired Canna Relief Consulting Canada Inc., a Canadian company that produces medical marijuana products and retails to patients. Total transaction value is estimated to be $250 thousand.

Financials (Announced)

Riot Blockchain to Acquire Tess

Riot Blockchain, Inc. (NasdaqCM:RIOT), an American company that leverages its expertise and network to build and support blockchain technology companies, has agreed to acquire Tess Inc., a Canadian company that provides blockchain-based payment escrow services for wholesale telecom carriers. No transaction terms were released.

Information Technology (Closed)

Resolver has Acquired Agiliance

Resolver Inc., a Brookfield Asset Management Inc. and Klass Capital backed Canadian company that provides governance, risk, and compliance (GRC) software solutions, has acquired Agiliance, Inc., an American company that provides integrated solutions for operational and security risk intelligence for businesses. No transaction terms were released.

Dye & Durham has Acquired Easy Convey

Dye & Durham Corporation, a Canadian company that provides easy-to-use legal software and technology enabled services to law firms in Canada and internationally, has acquired Easy Convey Ltd., a U.K. company that develops electronic conveyancing products and services. No transaction terms were released.

Synopsys has Acquired Sidense

Synopsys, Inc. (NasdaqGS:SNPS), an American company that provides electronic design automation (EDA) software products used to design and test integrated circuits (ICs), has acquired Sidense Corp., a Canadian company that provides one-time programmable non-volatile memory for use in automotive, mobile, industrial and Internet of Things (IoT) applications. No transaction terms were released.

2ic Systems has Acquired Sprintserve Net

2ic Systems Inc., a Canadian company that operates as a digital consulting agency that offers integrated support in branding, web development, digital marketing, and IT services, has acquired Sprintserve Net LLC, an American company that provides web hosting services. No transaction terms were released.

Lone Wolf Technologies. has Acquired Instanet Solutions

Lone Wolf Technologies., a Canadian company that provides residential real estate technology to brokers and agents, has acquired Instanet Solutions Inc., a Canadian company that offers real estate technology solutions. No transaction terms were released.

Telecommunication Services (Closed)

Distributel Communications has Acquired Navigata Communications

Distributel Communications Limited, a Canadian company that provides phone services, long distance calling plans, high speed Internet connections, and paging solutions for residential and business subscribers, has acquired Navigata Communications Limited, a Canadian company that provides phone services, long distance calling plans, high speed Internet connections, and paging solutions. No transaction terms were released.

Real Estate (Closed)

Colliers International Group has Acquired Serten Advisors

Colliers International Group Inc. (TSX:CIGI), a Canadian company that provides commercial real estate services to corporations, financial institutions, governments, and individuals worldwide, has acquired Serten Advisors, LLC, an American company that offers real estate advisory services. No transaction terms were released.

Other (Announced)

Avison Young to Acquire WHR Property Consultants

Avison Young (Canada) Inc., a Canadian company that provides commercial real estate solutions and services to owners and occupiers of office, retail, industrial, and multi-family properties, has agreed to acquire WHR Property Consultants LLP, a U.K. company that provides office, industrial, investment, project/building and professional property services and advice. No transaction terms were released.

Pivot Pharmaceuticals to Acquire Absorbent Concepts

Pivot Pharmaceuticals Inc. (OTCPK:PVOT.F), a Canadian company that engages in the development and commercialization of therapeutic pharmaceutical products in Canada, has agreed to acquire Absorbent Concepts Inc., a Canadian company that manufactures and produces their own line of organic hemp products. No transaction terms were released.

Gay Lea Foods Co-operative to Acquire Alberta Cheese Company

Gay Lea Foods Co-operative Ltd., a Canadian company that manufactures and markets dairy products in Canada, has agreed to acquire Alberta Cheese Company Ltd., a Canadian company that imports and distributes cheese and other food products from around the world. No transaction terms were released.

Golder Associates to Acquire Alan Auld Group

Golder Associates Corporation, a Canadian company that provides consulting, design, and construction services in the areas of earth, environment, and energy, has agreed to acquire Alan Auld Group Limited, a U.K. company with a long history of experience in mining projects in the U.K. and around the world. Total transaction value is estimated to be $389 million.

Morgan Resources to Acquire Jekyll & Hyde Brand Builders

Morgan Resources Corp. (TSXV:MOR.H), a Canadian company that engages in the acquisition, exploration, and development of precious and base metal properties in Canada, has agreed to acquire Jekyll & Hyde Brand Builders Inc., a Canadian company that converges the talents, expertise, and commercial networks of two successful strategy/marketing/branding firms on the North American business sector. Total transaction value is estimated to be $95 thousand.

Other (Closed)

Equipment Sales & Service has Acquired Selix Equipment

Equipment Sales & Service Limited, a Canadian company that supplies OEM, aftermarket, and wear parts, has acquired Selix Equipment Inc., a Canadian company that operates as a subsidiary of Equipment Sales & Service Limited. No transaction terms were released.

F12 Networks has Acquired Protocol Technologies

F12 Networks, Inc., a Canadian company that provides Hardware-as-a-Service, managed services, and cloud solutions, has acquired Protocol Technologies Inc., a Canadian company that provides and manages IT services. No transaction terms were released.

Threshold/Carve has Acquired Carve Creative + Strategy

Threshold/Carve, an American company operating as a boutique agency with offices in Austin, Texas, U.S. and Waterloo, Ontario, Canada, has acquired Carve Creative + Strategy, a Canadian company that provides creative branding solutions. No transaction terms were released.

Undisclosed Buyer has Acquired Sheraton Centre Toronto Hotel

An undisclosed buyer has acquired the Sheraton Centre Toronto Hotel from a subsidiary of Marriott International Inc., a U.S.-based international hotel operator. Total transaction value is estimated to be $335 million.

Back in Motion Rehab has Acquired Legacies Health Centre

Back in Motion Rehab Inc., a Canadian company that provides rehabilitation, disability prevention, and employment services for communities in Metro Vancouver, has acquired Legacies Health Centre. No transaction terms were released.

Weidmüller Holding AG & Co. has Acquired W Interconnections Canada

Weidmüller Holding AG & Co. KGaA, a German company that develops, manufactures, and sells electromechanical connection technology products, switching cabinet electronics, and network infrastructure components, has acquired W Interconnections Canada Inc., a Canadian company operating as the sales office for Weidmüller Holding AG & Co.  No transaction terms were released.