Pender West generally pursues opportunities in the manufacturing, distribution, consumer products and business services sectors. We target specific industries with favourable qualities such as strong growth prospects, barriers to entry, fragmented customers and suppliers, and economies of scale.
Pender West does not invest in start-ups, early stage financings, direct natural resources or high technology sectors.
Sustainable Competitive Advantage
Our prospective investment companies should have strong competitive positions within their industry. This competitive advantage may be derived from various factors including:
Proprietary, differentiated or branded products or services
Significant barriers to entry and/or low cost operating platform
High performing company culture
A loyal and broadly-based customer franchise
High Performing Companies
We target high performing companies that are profitable and have a demonstrated track record of success. Common characteristics of a successful investment company include:
Highly motivated, capable management teams whose entrepreneurial spirit would be enhanced through meaningful equity ownership
A significant and defensible share of a well-defined market
A strong historical financial profile with sustainable recurring cash flow, high EBITDA margins, and high return on net assets
A potential for long-term growth and value enhancement
Specifically, our investment scope includes:
Businesses based in Canada or Western U.S.
Recurring EBITDA of $2 - $6 million
Initial target equity investments of up to $10 million
Majority buy-out investments, and ability to co-invest alongside other financial partners for larger transactions
No set hold period or investment horizon
Industry generalists, with special interest in food, trucking & logistics, packaging, recycled products, branded consumer products, business services, niche manufacturing and distribution
Key acquisition candidates include:
Recapitalization of Family Owned or Closely Held Companies
Where shareholders of certain family owned or privately held companies wish to diversify their holdings or achieve liquidity by selling a partial amount of their ownership, Pender West can play a significant role in enabling such shareholders to achieve their goals. Pender West has the expertise to structure and recapitalize the company and to provide the equity component to maximize the desired recapitalization.
Management Buyouts of Private Companies
In situations where the principal shareholder(s) of a private company decides to sell and exit the business, Pender West will assist the management team to facilitate the buy-out.
Investments in companies where the founder is looking to exit all or most of his holdings, and wishes to ensure a respectful go-forward environment for his management teams by the new acquirer.
Where a major corporation has identified a business unit as “non-core” Pender West will work with the management team of that business unit to enable both the successful divestiture of the business unit by its corporate parent and the acquisition of the operations by the management team.
Strategic Acquisitions (Add-ons) for Existing Portfolio Companies
Pender West is constantly looking for acquisition opportunities for our existing portfolio companies. These opportunities can be in the form of out-right corporate acquisitions, financial advice, mergers, revenue or product line platform acquisitions.