Whitehorse Liquidity Partners has raised more than half of the US$1.5 billion target set for its third secondaries fund, according to a report by the Wall Street Journal. The Canadian private equity firm has collected at least US$1.9 billion in the past two years, the report said. Last September, Whitehorse announced the close of its second secondaries fund, Whitehorse Liquidity Partners Fund II, at its US$1 billion hard cap. The Toronto-based firm was founded in 2015 by Managing Partner Yann Robard, who previously led the secondaries and co-investments program of Canada Pension Plan Investment Board. Whitehorse specializes in making preferred equity investments in private equity portfolios.
Imperial Capital Group is only weeks away from wrapping up a seventh mid-market fund at its $650 million hard cap. Imperial Capital Acquisition Fund VII, launched in December, has already raised or hard-circled commitments above its $500 million target, Managing Partners Jeff Rosenthal and Justin MacCormack told PE Hub Canada. They expect to see a final close at $650 million in April. If this happens, the fund will be the largest in the Toronto private equity firm’s three-decade history, exceeding by 30 percent the $500 million secured by Fund VI in 2017.
While institutions pour billions of dollars into student-housing assets globally, a local private equity fund is looking to consolidate Canada’s fast-evolving sector. Last July, Alignvest Student Housing, an affiliate of Alignvest Management Corp, launched a fund to acquire purpose-built student accommodation. The evergreen vehicle has so far secured $125 million from family offices, institutions and wealthy investors, Managing Partner Jonathan Turnbull told PE Hub Canada. The money is capitalizing ASH's rapid deal pace, the result of an unexpectedly large supply of PBSA opportunities “coming out the woodwork,” primarily from local developers and investors, he said.
Caisse de dépôt et placement du Québec deployed more than $9 billion in the global private equity market in 2018, ending the year with net assets of $42.9 billion. PE investments generated a net return of 16.6 percent last year, exceeding a benchmark of 8.7 percent, according to the pension fund’s financial report. CDPQ has been steadily shifting its PE focus to solo deals, co-sponsorships and co-investments, Stephane Etroy, executive vice president and head of private equity, told PE Hub Canada last March. This is reflected in the 2018 report, which said direct deals currently account for three-quarters of PE portfolio activity.
Novacap aims to raise more than $650 million for its fifth mid-market industries fund by expanding its global base of limited partners. The Montréal private equity firm began raising Novacap Industries V in late 2018, Chairman and Managing Partner Jacques Foisy told PE Hub Canada. He expects to see an initial close by the spring and completion later this year. If successful, Fund V would secure 38 percent more in capital than its predecessor, which raised $470 million in 2016. More than $400 million has already been soft-circled for Fund V, primarily from returning investors, Foisy said.
Vertu Capital has teamed up with BDC Capital's growth equity group to acquire Firmex, a Toronto provider of virtual data rooms and secure document sharing solutions. Terms weren’t disclosed. Vertu and BDC partnered on the deal with top management, including Joel Lessem, the company’s co-founder and CEO. Debt financing was provided by Bank of Montreal. The seller is Novacap’s mid-market tech group, which acquired Firmex in 2016. Firmex is the inaugural investment of Vertu, a tech private equity firm founded two years ago by Lisa Melchior, a former managing director of OMERS Private Equity.
Canada’s private equity market had a banner year in 2018, especially in terms of dollars invested. As in the past, the lion’s share of deals engaged mid-market companies. Most of the cash, however, was accounted for by a small collection of large caps. Among them was the $5.1 billion recap of GFL Environmental, which headed the top 10 PE deals last year. Combined, they had disclosed values of $32 billion, up 70 percent from the $19 billion the top 10 deals of 2017 drew. The number is based on PE Hub Canada’s list of the largest deals announced in 2018, supplemented by preliminary data from Refinitiv. It suggests that large caps fueled the most substantial dollar flows in the market’s history.
Penfund wrapped up its sixth mid-market fund, raising $1.15 billion, thanks to a private-debt strategy that resonated with investors. Penfund Capital Fund VI, launched in early 2018, closed in December above its $900 million target, Chairman and Partner John Bradlow and Partner Richard Bradlow told PE Hub Canada. The fund, backed by 40 new and existing limited partners in North America, Europe and Asia, is the largest in the Toronto junior-capital provider’s 40-year history, exceeding by 59 percent the $724 million its predecessor raised in 2016. The close brings assets managed by Penfund to $1.8 billion.
Lex Capital Management has secured $127.5 million in committed capital in the first close of its fourth energy private equity fund. Lex Energy Partners LP IV, targeted at $200 million, was backed by a range of North American limited partners, according to a news release. They included individuals, foundations, family offices and institutional investors. Fund IV will maintain Regina-based Lex's strategy of providing seed, growth or acquisition capital to private early-stage oil and gas companies operating in Western Canada. Since its inception in 2009, the firm has raised more than $417 million across four energy funds and one diversified fund.
Australia's Healthscope Ltd said it has extended exclusive takeover talks with suitor Brookfield Asset Management by a month, and that a rival suitor remained interested, potentially re-igniting a bidding war, Reuters reported. The private hospital operator has not yet committed to a binding A$4.5 billion (US$3.2 billion) offer from the Canadian investment firm. Healthscope also said rival bidder BGH Capital and its partners, which reportedly include Canada Pension Plan Investment Board and Ontario Teachers’ Pension Plan, were prepared to commence due diligence even though their A$2.36 per share indicative offer was rejected as “less attractive”.