Onex prepares to reduce long-held interest in Celestica

• Onex intends to convert its MVS to SVS on a one-for-one basis
• The conversion is likely to happen in about six months
• Onex acquired Celestica in 1996 from IBM for $550 million

Canadian private equity firm Onex plans to convert its multiple voting shares (MVS) in Celestica, a Toronto-based provider of electronics manufacturing services, to subordinate voting shares (SVS), on a one-for-one basis.

The conversion is expected happen in about six months.

“Celestica and Onex have shared a productive relationship for over 25 years. The planned conversion of Onex’ MVS and the simplification of Celestica’s voting structure is the natural next step in the company’s evolution,” said Bobby Le Blanc, president of Onex, in a statement.

Celestica also plans to file a Canadian base shelf prospectus.

“In 2022, Celestica posted its highest annual non-IFRS operating margin and highest non-IFRS adjusted EPS in the company’s history. Celestica is a much different company than it was just five years ago and we view this as the next logical phase in the company’s transformation,” said Rob Mionis, president and CEO, Celestica.

Celestica has operated with a dual class share structure since it completed its initial public offering in 1998, according to SEDAR documents. Since then, Onex has beneficially owned all the company’s outstanding MVS.

Onex acquired Celestica in 1996 from IBM for $550 million. In 2021, Celestica acquired PCI, a Singapore-based electronics manufacturing services provider, from Platinum Equity for $306 million.

Based in Toronto, Onex operates two primary businesses: private equity and credit. It managed about $51 billion of assets as of September 2022.