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Canadian M&A Roundup April 29, 2017 – Canam, Lumenpulse

Target: Canam Group Inc. [ [stock_quote symbol=”TSE:CAM” show=”symbol”] ]

  • Industry: Industrials
  • Acquirer: American Industrial Partners, Dutil family
  • Target: Canam Group Inc
  • Size: $555 million
  • Funding Mix: 100% Cash
  • Sell Side Adviser: BMO Capital Markets
  • Buy Side Adviser: Morgan Stanley
  • Legal Advisers: Fasken Martineau DuMoulin LLP, Norton Rose Fulbright Canada LLP, Ropes & Gray LLP, Stikeman Elliott LLP

On April 27, 2017, American Industrial Partners and the Dutil family announced a definitive agreement to acquire Canam Group Inc for approximately $555 million (excluding 4.7 million shares currently owned by the Dutil family that will roll over with the transaction). Caisse de dépôt et placement du Québec and Fonds de solidarité FTQ are also expected to participate as equity investors by rolling over a portion of their current shares as part of the deal.

The all-cash transaction will pay a consideration of $12.30 per share with an implied EV/EBITDA of 53.9x and P/E multiple of 25.6x. The rationale behind the deal was to shift control of the structural steel maker to American Industrial Partners, a private equity firm based in the US. It will also provide management with greater flexibility to focus on the long-term success of the business as Canam struggled to meet analyst’s forecasts and investors expectations in previous quarters.

BMO Capital Markets acted as the financial adviser, and Fasken Martineau DuMoulin LLP and Norton Rose Fulbright Canada LLP acted as the legal advisors to Canam Group.

Morgan Stanley acted as the financial adviser, and Ropes & Gray LLP and Stikeman Elliott LLP acted as the legal advisers to American Industrial Partners. The deal is expected to close no later than September 1, 2017.

Target: Lumenpulse Inc [ [stock_quote symbol=”TSE:LMP”] ]

  • Industry: Power
  • Acquirer: Power Energy Corp
  • Target: Lumenpulse Inc
  • Size: $550.48 million
  • Funding Mix: 100% Cash
  • Sell Side Adviser: CIBC Capital Markets
  • Buy Side Adviser: National Bank Financial
  • Legal Advisers: Fasken Martineau DuMoulin LLP, Norton Rose Fulbright Canada LLP, Stikeman Elliott LLP

Power Energy Corp and a group led by François-Xavier Souvay (Founder, President & CEO of Lumenpulse) and other key existing shareholders of Lumenpulse announced an arrangement agreement to acquire all common shares of Lumenpulse on April 27, 2017.

The $550.48 million all-cash deal will pay a consideration of $21.25 per share with an implied EV/EBITDA of 40.0x and P/E multiple of 30.6x. The deal will result in the privatization of Lumenpulse, which will become a part of the larger portfolio of investments in sustainable energy at Power Energy Corp.

Lumenpulse has struggled to meet earnings expectations since their 2014 IPO due to erratic profit growth behaviour. Both companies are based in Montreal, QC and are interested in continuing innovation in sustainable lighting technologies. The companies hope to leverage Lumenpulse’s expertise in LED technologies and Power Energy Corp’s renewable solar plants to become a leader in the high performance architectural specification grade lighting sector.

CIBC Capital Markets acted as the financial adviser, and Fasken Martineau DuMoulin LLP and Norton Rose Fulbright Canada LLP acted as the legal advisers to Lumenpulse.

National Bank Financial acted as the financial adviser, and Stikeman Elliott LLP acted as the legal adviser to Power Energy Corp.

Sara
Sara
Sara Troka is a first year HBA student at Ivey Business School. Sara will be joining a bank in NYC next summer. She was involved in the York Finance Club as VP Marketing and the York University Student Investment Fund as a Junior Analyst. Outside of finance, Sara enjoys photography and fashion. She is an avid traveler who enjoys exploring historic cities and beaches across Europe.
https://www.linkedin.com/in/saratroka/

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