Veterans of the aerospace industry have launched a new fund with the help of Quebec and institutional investors to help SMEs in the sector grow.
The Thrust Capital Partners fund has access to $ 77 million to acquire a majority stake in five to six SME, while keeping management teams in place, announced the private equity fund Tuesday in Montreal. The goal is to reach an investable capital of $ 100 million in consecutive rounds of financing.
The companies targeted will come from the commercial and business aviation sectors, as well as defense, helicopter, drone and space.
The Quebec Government has injected $ 30 million into the fund’s capital. Fonds de solidarité FTQ and the Mouvement Desjardins, for their part, provided $ 20 million and $ 12.5 million respectively.
Something in size
The investment comes at a time when the aerospace industry is experiencing a recovery. However, the acceleration of the production rate represents a challenge for the smallest players, explains Frédéric Loiselle, president of Thrust Capital Partners.
” There are many opportunities in the future, and what prevents a SME to maximize it’s capital and operational capacity. “
The SME need to be bigger to maximize their opportunities with major contractors like Airbus, Boeing or Bombardier, Aéro Montréal president and CEO Suzanne Benoit explained in an interview. For to live in a global market, these companies must have a certain critical mass to be competitive, according to him.
” To do business around the world, competitors elsewhere in Europe are SME 200 to 250 employees, larger turnover, $ 40 to $ 50 million. We in Quebec often talk about $ 5 to $ 15 million. “
Supply chain disruptions also weigh SME Of industry. More than half (57%) of the owners SME the sector said they were forced to change their borrowing capacity to ensure access to the goods they needed to meet demand, according to a KPMG Canada survey, released the same day.
A five year horizon
Thrust Capital gives itself five years to find the companies in which it intends to invest in approximately seven years. The strategy is to finance the company’s growth, whether through acquisition or internal, Mr. Loiselle explained in an interview.
” We buy the company, we build it and then we pay off the debt. The idea is resold after that. “
In addition to capital, the Thrust Capital team also provides expertise to support companies. It’s smart money too, it’s not just dollars, it’s the ability to put your shoulder on the wheel to face the challengegiit ni mr. Loiselle.
Prior to entering the business, President Thrust Capital worked as an aerospace industry specialist at the Business Development Bank of Canada (BDC). He added that entrepreneurs can rely on the advice of a consulting committeewhich notably includes former finance minister Raymond Bachand and the executive chairman of Héroux-Devek’s board, Gilles Labbé, who spearheaded the merger between Héroux and Devtek in 2000.
We’re not bad wolves that come financially, ironically Mr. Loiselle. We come from the sector and together we grow the company.
Source: Radio-Canada
