Value Unleashed

Market Updates

Global equities were nearly unchanged on the week as the market grappled with the possibility of a rate hike from the US Federal Reserve in the coming months. The Chicago Board Options Exchange Volatility Index (VIX) rose slightly, while the yield on the 10-year US Treasury note Increased to 1.86% from 1.75%. West Texas Intermediate crude prices rose to $48.30 from $46.31 last week.  Middle market credit market conditions remain robust.
 

Valitas Insights: Middle market private equity hold times continue to Increase, Foreign private equity investment in Canada declines

On May 11, 2016, PitchBook published an article regarding the decline in private equity-backed exits across the whole market in the first quarter. The U.S. middle market also had low exits with only 170 sales for approximately $13 billion transaction value. The inventory firms have left on their books from the buyout boom era, which is the median hold times is longer than historical record. Read the full article.
 

On May 18, PitchBook published another interesting article regarding pull-back in U.S. and other foreign investment in the Canadian middle market.  What's driving the decline?  Will it last? Read the full article.
 

Business Transitions Forum in Toronto on June 8: Maintaining Confidentiality During a Competitive Sale Process
 

 
Weekly Canadian Private Market M&A Report

Announced Deals

AT&T to acquire Quickplay from Madison Dearborn Partners

U.S. telecommunications company AT&T Inc. (NYSE: T) has agreed to buy Quickplay Media Inc., a Toronto-based managed video platform that powers premium video over all networks and devices. No financial terms were disclosed for the acquisition. "Our strategy is to deliver video content however, whenever and wherever," said John Stankey, CEO, AT&T Entertainment Group. "Quickplay's multitenant IP distribution infrastructure, combined with AT&T's leading scale in IP connected end points, will allow us to host and distribute all forms of video traffic. We intend to scale and operate an industry-leading video distribution platform, and viewers will get the high-quality online video viewing experience they desire."

Closed Deals

Siem Offshore buys Birch Hill's 50 percent stake in Secunda Canada

Norway's Siem Offshore AS has acquired the 50 percent interest in Secunda Canada LP held by Birch Hill Equity Partners, a Canadian mid-market private equity firm. No financial terms were released for the deal, which resulted from a recapitalization of Secunda, an operator of harsh-weather offshore support vessels servicing the oil and gas industry. With this transaction, Siem Offshore becomes the 100% owner of Secunda Canada and supports the long term commitment to the Canadian market.

Quad-C sells InterWrap to Owens Corning for $450 million

U.S. private equity firm Quad-C Management has wrapped up its sale of InterWrap Inc., a Canadian manufacturer and distributor of synthetic roofing underlayment and packaging materials. The deal, announced earlier this year, saw Owens Corning (NYSE: OC), a U.S. producer of insulation, roofing and fiberglass composites, acquire the company for US$450 million. "The entire InterWrap team is very proud of all we accomplished during our multi-year partnership with Quad-C," said InterWrap CEO, Eduardo Lozano. "Quad-C's investing experience, industry expertise and support were invaluable in driving the strategic vision for our company and getting us to where we are today."

AMP and Northleaf close $370 million buy of Chicago's Millennium Garages

AMP Capital and Northleaf Capital Partners have closed their buy of Chicago Downtown Public Parking System (Millennium Garages), the largest underground parking system in the United States. The deal, announced earlier this year, saw LMG2 LLC sell the system to MPG LLC, a joint venture established by AMP and Northleaf, for US$370 million. AMP Capital Head of Americas Infrastructure Dylan Foo said: "Millennium Garages is the first North American asset for AMP Capital's global infrastructure platform and fits perfectly with the platform's mandate to invest in sectors offering the best relative value such as transport. Millennium Garages offers exciting growth potential for our investors due to the strength of Chicago's economic and demographic factors, stable and predictable cash flows and strong protections through the concession agreement."

Providence-backed Blue Star Sports acquires Goalline

Blue Star Sports has acquired Goalline, a Halifax-based provider of sports management software that currently services over 10 million users. No financial terms were released. Rob Wechsler, Founder and CEO of Blue Star Sports commented on the transaction, "From the beginning, the vision for Blue Star Sports has been to professionalize the experience of youth sports organizations and to simultaneously make it easier for anyone involved to manage the sport. With Goalline's leading customer service and performance capabilities, we can now provide a seamless customer experience and a more unified offering."