Nova Capital Management has acquired five industrial businesses in Canada that formed the major part of Premetalco Inc., the Canadian subsidiary of Amalgamated Metal Corp., the firm announced Monday. Financial terms of the deal were not released. McGladrey Capital Markets acted as lead financial advisor to AMC. HSBC Securities, Stikeman Elliott, Simmons & Simmons and KPMG advised Nova Capital.
Nova Capital Management Ltd (‘Nova’) the specialist acquirer of corporate and private equity portfolios has completed the acquisition of five industrial businesses in Canada. The acquired businesses formed the major part of Premetalco Inc. (“Premetalco”), the Canadian subsidiary of Amalgamated Metal Corporation Plc (“AMC”) a UK based industrial group.
McGladrey Capital Markets LLC initiated the transaction, sourced the acquirer and acted as lead financial advisor to AMC. Blake, Cassels and Graydon LLP acted as legal advisor to AMC. Nova was advised on the acquisition by HSBC Securities (Canada) Inc. Investment Banking, Stikeman Elliott LLP, Simmons & Simmons LLP and KPMG LLP.
The businesses acquired are:
· Wilkinson Steel and Metals, one of Canada’s leading steel services groups;
· Exchanger Industries, a manufacturer of heat exchangers primarily for the oil and gas industries;
· NCA East and NCA West, which together represent Canada’s leading distributor of form hardware and concrete accessories;
· Debro Chemicals & Pharmaceuticals, distributor of industrial chemicals.
The five acquired businesses have aggregate sales of approximately C$400million and employ more than 720 people in 30 operating facilities across Canada.
The acquisition was made through a newly formed company Nova Argent Canada Inc. Financing for the acquisition was provided by an equity syndicate comprising Nova, HarbourVest Partners LLC, Morgan Stanley Investment Management, Headway Capital Partners LLP, Parish Capital Advisors LLP and a debt syndicate led by HSBC Canada.
Following the acquisition, two of Nova’s partners, Dennis Powers (Operating Partner) and Kathryn Jones (Investment Partner) will be relocating to Canada to support the executive management teams of the acquired businesses. Nova’s Canadian operation will be based in Vancouver.
David Williamson, Managing Partner of Nova commented: “We are delighted to have completed this portfolio acquisition. It fits perfectly with our strategy of buying groups of companies, which are well managed and have strong market positions but where we feel we can accelerate their growth through the deep operational and international experience which we can bring to bear. We are excited to be opening a new office in Canada and believe that this will open up other opportunities for us.”
“This was a complex cross-border transaction for a variety of reasons, particularly Premetalco’s diverse business lines, all in different locations,” said Malik Sharif, Managing Director at McGladrey Capital Markets LLC, the lead financial advisor to AMC. “The AMC team sought a simplified transaction with one party, and we were able to get there with Nova’s portfolio approach.”
About Nova Capital Management Ltd
Established in 2002, and with a 20 strong team, Nova has acquired or taken over the management of portfolios representing a total transactional value of over €1.0bn. Nova currently manages investments in over 25 businesses primarily operating in Western Europe and North America, across a broad range of sectors. Nova Capital Management Limited is regulated and authorised by the Financial Services Authority.
About McGladrey Capital Markets
McGladrey Capital Markets LLC (www.mcgladreycm.com) is a global provider of investment banking services to private and public companies with annual revenues of up to $1 billion. The firm’s services include mergers, acquisitions, divestitures, recapitalizations, capital raising, fairness opinions and restructurings. McGladrey Capital Markets, which offers in-depth expertise in many distinct industry sectors, brings together companies, capital and creativity on a national and international scale to help clients achieve their personal and strategic objectives.
McGladrey Capital Markets is affiliated with McGladrey Inc., a professional services firm providing accounting, tax and business consulting. Both firms are indirect subsidiaries of H&R Block Inc. (NYSE: HRB), the world’s preeminent tax services provider. McGladrey Capital Markets’ international headquarters are located in Costa Mesa, Calif. The firm is a member of FINRA.