Canadian specialty finance firm Crown Capital Partners has initially closed its fourth special situations debt fund, Crown Capital Fund IV LP. Fund IV secured $100 million, meeting its first close target. The Calgary-based firm is seeking $300 million in total for the fund. It said additional closings will occur within the next three years as deal opportunities are identified. As reported by PE Hub Canada in June, Crown Capital has been pursuing a two-track fundraising process that includes proceeds obtained through its initial public offering (IPO). The IPO was completed in July. Capital raised from both sources will support the firm’s expanded program for investing debt and quasi-equity in mid-market companies.
Crown Capital Partners Inc. Announces Closing of Crown Capital Fund IV, LP
CALGARY, Sept. 24, 2015 /CNW/ – Crown Capital Partners Inc. (“Crown”) (TSX: CRN) today announced the closing of its fourth special situations debt fund, Crown Capital Fund IV, LP (“Crown IV LP” or the “Fund”) with initial capital commitments of $100 million. The Fund’s initial limited partners, including Crown, will contribute a total of $15 million for the initial capitalization of the Fund with further capital calls to be made as funds are required.
Crown IV LP will invest in Special Situations Financing transactions originated and managed by Crown. Crown’s Special Situations Financing solutions consist of senior and subordinated loans with terms ranging from six months to five years. These financing solutions are typically secured by the borrower client’s business and assets, subject to prior interests of any existing senior lenders in the case of subordinated loans. Special Situations Financing solutions are structured to limit ownership dilution and provide the borrower client with the ability to focus on managing and growing their business. In some transactions, Crown also structures Special Situations Financing solutions to include issuance by the borrower client of warrants, payments in kind, phantom equity or gifted shares. Such bonus features provide the Fund with the ability to participate in the growth of such clients in addition to income from interest payments and transaction fees received from the borrower client.
Crown IV LP has a maximum size of $300 million, with additional closings to occur within the next three years as opportunities are identified to fund Special Situations Financing transactions. Crown has committed to invest up to $50,000,000 to Crown IV LP and will initially hold a 50% interest in the Fund. In addition to investment returns on its capital commitment, Crown will earn management fees from Crown IV LP and have the opportunity to earn additional fees based on the performance of the Fund.
“The timing for Crown Capital Fund IV, LP couldn’t be better” says Chris Johnson, President and CEO of Crown, “We have an active pipeline of investment opportunities, many of which arise from the ongoing volatility in financial markets. We would like to thank the initial limited partners for their continued support of our business.”
Crown is a specialty finance company focused primarily on providing capital to successful Canadian companies, and to select U.S. companies, that are unwilling or unable to obtain suitable financing from traditional capital providers such as banks and private equity funds. Crown also manages capital pools, including some in which Crown has a direct ownership interest. Crown originates, structures and provides tailored transitory and permanent financing solutions to a diversified group of private and public mid-market companies in the form of loans, royalties and other structures with minimal or no ownership dilution.
This release contains certain “forward looking statements” and certain “forward looking information” as defined under applicable Canadian and U.S. securities laws. Forward-looking statements can generally be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “continue”, “plans” or similar terminology. Forward-looking statements include, but are not limited to, statements with respect to the initial capitalization of the Fund, the investments of Crown IV LP in Special Situations Financing transactions and the potential structuring of such transactions, the sourcing of deals from Crown’s established network, the future capitalization of the Fund and future closings; and Crown’s future entitlement to base management and performance fees. Forward-looking statements are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in the Corporation’s periodic filings with Canadian securities regulators. The Corporation undertakes no obligation to update forward-looking information except as required by applicable law. Such forward-looking information represents management’s best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.
To find out more about Crown (TSX: CRN) please visit our website www.crowncapital.ca.
SOURCE Crown Capital Partners Inc.
For further information: Christopher Johnson, President & CEO, firstname.lastname@example.org, (416) 640-6715
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