Canadian PE Firm Onext Raises $314M in Fund IPO

Canadian private equity firm Onex has raised C$320 million ($314 million) in an initial public offering of its high-yield debt fund, OCP Senior Credit Fund, Reuters reported. The firm sold 32 million shares at $10 apiece. The offering was handled by a syndicate co-led by CIBC World Markets and RBC Capital Markets, Reuters said.

(Reuters) – Onex Corp , one of Canada’s leading private equity firms, said on Friday it raised a greater than expected C$320 million ($314 million) with the initial public offering of its high-yield debt fund, known as the OCP Senior Credit Fund.

Onex Credit Partners, Onex’s credit investing platform, said it sold 32 million units at $10 each. An over-allotment option granted to underwriters to buy another 2.5 million units could see it raise another C$25 million if fully exercised.

The offering is being handled by a syndicate co-led by CIBC World Markets and RBC Capital Markets, and includes BMO Capital Markets, Scotia Capital, National Bank Financial, TD Securities, Dundee Securities, GMP Securities, Canaccord Adams, HSBC Securities (Canada), Macquarie Private Wealth, Raymond James, Wellington West Capital Markets, Desjardins Securities, Manulife Securities, and Mackie Research Capital Corp.

Canada’s IPO market is gaining traction in stops and starts, with companies going public with increasing frequency.

The OCP Senior Credit Fund aims to provide holders with quarterly distributions initially targeted at C$0.125 per quarter, representing an annual yield of 5 percent on the original issue price of C$10 per unit, Onex Credit Partners said in its final prospectus for the fund.

Onex was formed about 25 years ago, and went public in 1987 as it became Canada’s biggest and best-known leveraged buyout firm. It has bought distressed companies in industries as diverse as electronics, health care, movie theaters and cosmetics.

The OCP units are to be listed on the Toronto Stock Exchange under the symbol OSL.UN.

Earlier this week, Tourmaline Oil Corp, run by Calgary oilman Mike Rose, said it had priced an offering to raise up to C$259.35 million amid recovering markets for IPOs [ID:nN16132646].

The market has not yet returned to full strength, however, and some firms have not experienced the investor appetite they had hoped for.

Whistler Blackcomb, the ski resort north of Vancouver that helped host the 2010 Winter Olympics, had to scale back pricing on its IPO late last month. SNC-Lavalin , Canada’s biggest engineering company, canceled plans to take its TransAxio highway concession division public, citing adverse market conditions.

(Reporting by Pav Jordan; editing by Rob Wilson)