CANADA - The C$12bn (US$7.6bn) Canada Pension Plan Investment Board (CPPIB) has committed C$386.7m (US$245m) to two new private equity funds.
The first investment by the CPPIB is a new Canadian fund, the Tricap Restructuring Fund. The CPPIB will commit C$150m (US$95m) over the next five years to the fund, which is the only private equity fund in Canada strictly focused on restructuring and turn-around opportunities.
Trilion Financial runs the fund and is its largest individual investor. Other Tricap investors include the Canadian Bank of Commerce and TD Capital. Mark Weisdorf, CPPIB vice president, private market investments said of the investment: This is an area where the funds we receive from the Canada Pension Plan can generate investment income that will eventually help to pay future pension benefits, and at the same time work in the best interests of a stronger Canadian economy.
The CPPIB’s other new private equity commitment is to the US-based fund, Heartland Industrial Partners. Over the next six years, the CPPIB will commit up to C$236.7m (US$150m) to the new fund, which aims to consolidate industrial acquisitions in the auto parts and other manufacturing sectors to create more profitable growth enterprises.
We like the quality of the team that has come together to manage what will eventually be a US$1.5bn buyout fund. This is an opportunity for us to get involved at the ground floor in a new private equity pool that should produce superior long-term returns, Weisdorf said.
By Geoffrey Ho
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