Canadian PE Values Total $11.6B in 2012, Deal Volume Sets New Record

Buyout and related private equity (PE) deal-making in Canada showed sustained momentum in 2012, with disbursements totaling C$11.6 billion, just edging out the C$11.5 billion of 2011, reported Thomson Reuters (publisher of peHUB Canada). Additionally, deal volume in the Canadian market was the highest on record. Control-stake buyouts, minority investments, and other PE transactions totaled 313 last year, up 4% from 2011, when the previous record was set. Fund-raising activity also increased, with a total of C$4.6 billion in new capital commitments going to 23 domestic funds, up 24% from the year before.


Canadian buyout-PE market trends

Buyout and related private equity (PE) market activity in Canada showed sustained momentum throughout 2012, with disbursement
levels ultimately surpassing those of 2011. At year’s end, disclosed deal values totaled $11.6 billion, just edging out the $11.5 billion
reported the year before, and marking the highest level of dollars invested in the Canadian market in four years.

In addition, Canadian buyout-PE deal volume in 2012 was, according to Thomson Reuters’ data, the highest on record. Control-stake
buyouts, minority investments, restructurings and other PE transactions, both announced and closed, totaled 313 last year, up 4%
from 2011, when the previous record was set.

Relative to Q3 2012, Canadian deal-making increased in the last three months of the year, when a total of 66 transactions, reflecting
disclosed values of $4.0 billion, were announced or closed. While the number of deals in this period was lower on a year-over-year
basis, dollar flows rose by over 80%.

The fourth quarter saw several major transactions, including the two largest Canadian buyout deals closed in 2012. The Montréal-based Garda World Security Corp. was taken private in this period by British buyout firm Apax Partners for $1.1 billion. Additionally, the previously-announced $1.1 billion acquisition of Toronto’s Q9 Networks Inc. by BCE Inc., Teachers’ Private Capital, Madison Dearborn Partners and Providence Equity Partners was completed. Other major deals in Q4 2012 included a $150 million investment in Canbriam Energy Inc. of Calgary by Teachers, a $136 million acquisition of HOMEQ Corp. of Toronto by Birch Hill Equity Partners, and a $116 million investment in Whistler Blackcomb Holdings Inc. of Vancouver by KSL Capital Partners.

Despite the high profile of mega-deals (i.e., $1 billion-plus) in the Canadian market in 2012, it was transactions sized between $100
million to $500 million that took the largest share of total dollars invested (44%). Larger-caps of more than $500 million accounted
for a 32% share, followed by deals of between $25 million and $100 million, which garnered 14%. The remaining 168 transactions
sized less than $25 million accounted for the balance.

Source: Thomson Reuters Canada, the official source of statistics for Canada’s Venture Capital and Private Equity Association.

To read the entire Canadian private equity report, you can visit Thomson Reuters’ website.

Photo courtesy of Shutterstock.

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