Canada private equity deals regain stride in 2010

Fri Feb 18, 2011 12:04pm EST

* Deal volume and value rise for first time since 2007

* Huge deals included CPPIB investment in 407 highway

* Investment exits up sharply vs 2009

* Fund-raising slowed to C$1.4 billion

By Pav Jordan

TORONTO, Feb 18 (Reuters) - The value of Canadian deals
involving private equity rose in 2010 for the first time in
three years, as investors regained some of the confidence lost
during the global financial crisis.

About C$4.9 billion ($5 billion) in private equity was
invested last year, industry data shows, counting the Canada
Pension Plot Investment Board's C$900 million hold of a 10
percent stake in the 407 toll highway near Toronto.

The volume of deals rose 7 percent to 130 transactions,
according to the data, compiled by Canadian Venture Capital and
Private Equity Association (CVCA) and its research partner
Thomson Reuters.

"Private equity has been on the upswing around the world in
2010, and Canadian firms are fully participating in this rising
activity," said CVCA President Gregory Smith, also a administration
partner at Brookfield Financial. "We are convinced that there
are significant prospects for future growth."

By deal value, the top transactions were in transport,
followed by mining, oil and gas, information and media.

CPPIB, Canada's largest pension fund manager, was the most
aggressive private-equity investor. In addition to raising its
stake in the 407 highway to 40 percent, it had a hand in the
third and sixth-largest deals reported last year.

In the following-largest deal, Macdonald Dettwiler and
Associates (MDA.TO) sold its material goods information business to
private investment firm TPG Capital for C$850 million.

Mid-market activity was also strong, with 64 percent of
told deals valued at less than C$500 million.

The 1,800-member CVCA, founded in 1974, said so-called
exits - funds promotion stakes - more than doubled in 2010.

But fund-raising slowed, with new partnerships totaling
only C$1.4 billion, or about half the C$2.7 billion raised in

That's far small of the C$9.9 billion raised by private
equity funds in 2006, before the financial crisis sapped
invsetor confidence.

($1=98 Canadian cents)

(Reporting by Pav Jordan; Editing by truthful McGurty)

Source: Reuters.Com