Q-News
August 2010
Posted in Private Equity
There were 12 private Canadian company financings announced in July. Ten of the press releases reported the actual
amount of money being put into the companies – adding up to $438 million in new
capital. However, we feel that it would
be inappropriate to compare these totals to the figures that we have reported
in previous newsletters due to the fact that $360 million of the $438 million
figure came from two large transactions that do not fall under the categories
that we have traditionally focused on in our newsletter.
The two deals impacting our numbers were a $250 million investment in an
oil sands play and a $110 million financing by a waste conversion plant. If we ignore the dollar figures raised in
those deals, in order to better evaluate month-to-month financing trends, we
are left with $78 million in new capital.
Therefore, even after the adjustment, our numbers look better than the
nine deals and $41.5 million reported in July of 2009 or the four deals and $37.2
million in new capital announced last month.
Five of the companies receiving money in July can be classified as
technology companies. The remaining
seven deals came from highly diversified industries. The majority of the activity took place in Ontario with eight financings, two of the announcements
came out of British Columbia, and the last two
transactions took place in Quebec and Alberta. Looking at Canadian funds making investments
abroad, we saw Toronto’s venture debt players
continuing to invest in VC-backed software companies in the US.
Financings of Canadian
Companies
Dayforce, a provider
of on-demand workforce management solutions, raised $10 million in a financing
led by Bridgescale Partners. Dayforce is headquartered in Toronto with an office in Atlanta.
Mississauga-based Morega
Systems, the developer of software and hardware for viewing
personalized digital video content across a variety of consumer devices, raised
$10 million. The round was led by Celtic House
Venture Partners, and also involved GrowthWorks, as well as a
co-investment from the Ontario Emerging
Technologies Fund.
Cellfor, a provider of
genetically unmodified seedlings used for reforestations, received $35 million
in equity from a group of investors led by the Capricorn Investment Group. This is the first time that the Capricorn
group has invested in Cellfor. The other
participants in the round were return backers, including Credit Suisse First Boston Equity
Partners LP, ATP Capital, BDC
Venture Capital Group, and GrowthWorks Capital.
Sprott Power was the recipient
of a $2 million investment from the VentureLink
Diversified Income Fund. Sprott
Power is a
privately held Canadian company, headquartered in Toronto that develops renewable energy
projects built around wind, water, and solar technologies.
Ontario-based Ice River Springs, a
company that bottles natural spring water and sells it under its own brand name
as well as through private label channels, raised $15 million from Key Principal Partners
of Cleveland, Ohio.
Toronto’s Vicicog, a developer of the New Mechatronic
Variable Speed Drive (NMVSD), a technology which aims to improve the efficiency
of any device with a motor, engine or generator, has raised $600,000 in an
angel round led by Up Capital and Valleydene Corporation. The beachhead markets that the company
intends to initially pursue are the heating, ventilation and air-conditioning
market.
TorQuest Partners made a
significant investment in BC-based 4Refuel. 4RFeul provides fuel-related services and biodiesel to companies in
industries such as transportation, logistics, construction, municipal, mining,
rail, and forestry.
Miralta Capital,
the Arjesan II Limited Partnership fund,
along with other funders, invested an undisclosed amount into Ottawa’s IPeak Networks, whose technology
optimizes IP networks to handle video conferencing, telepresence, and virtual
computing applications.
Privately held Laricina Energy, a
Calgary-based exploration company with five oil sands properties in Western Canada, raised $250 million from CPP Investment Board.
US and International Activity in Canada
Highland Capital Partners participated alongside
BDC
Venture Capital in a $12 million raise by Quebec’s Beyond the Rack, a membership-based
online shopping site that offers members steep discounts on designer brands.
New York-based Metamorphic
Ventures and Geoff Judge of Amplitude Peak
invested $1.4 million in Toronto-based Chango, a technology-driven service
company whose innovative ad platform allows online advertisers to target
internet users based on their search history.
This round follows a $750,000 investment by iNovia Capital and Extreme
Venture Partners last November.
Ottawa-based Plasco Energy Group,
which operates high tech facilities that convert waste into energy, secured
$110 million in a financing that was led by Ares Management LLC
(CA). The company’s website states that
it had already raised $90 million in private and government funding prior to
this latest transaction.
Canadian Investments Abroad
California-based PacketMotion,
whose technology manages and records access to corporate network applications
for security and audit/compliance reasons, has received $3.5 million in debt
from MMV
Financial. PacketMotion was
already backed by Mohr Davidow
Ventures, Intel Capital,
Onset
Ventures, and Reservoir Capital Group.
Wellington Financial LP
has invested an undisclosed amount into Massachusetts-based Marathon Technologies Corporation,
the developer of a disaster recovery software product that minimizes data loss
by preventing unscheduled application downtime.
Fund News
Toronto’s Northleaf Capital Partners,
announced the launch of a new fund-of-funds with a target of $200 million.
Georgian Partners
has announced the first closing of its initial fund, Georgian Partners Growth Fund I.
The firm raised more at first close than its target of $50 million. Georgian
Partners intends to invest in growth and later-stage enterprise software
companies. The lead investor was the Ontario Venture
Capital Fund, which committed up to $15 million to the firm’s first
fund.
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