FundingSources – Must Reads – Week of Aug. 17

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  • Canadian Pension Plan Investment Board (CPPIB). On August 24, CPPIB announced the completion of its USD$12B acquisition of Antares Capital. Antares is the leading provider of financing solutions to middle market private equity sponsors in North America, offering a “one-stop” source for lending and other services. Over the past five years, Antares has facilitated more than USD$120 billion in financing.

QP Briefing. OPG reports rising profits in first half of 2015

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By Brian Platt

For the first half of the year, OPG’s earnings are up to $423 million, compared with $357 million in the same period in 2014.

Ontario Power Generation Inc. has reported moderate growth in profit in the first half of 2015, attributing it to new regulated prices, higher nuclear power production, and additional generating stations coming online.

The government-owned power producer says earnings for the second quarter of 2015 rose to $189 million from $115 million a year earlier.. That means for the first half of the year, OPG’s earnings are up to $423 million, compared with $357 million in the same period in 2014.

This comes after OPG had a very strong year in 20141, recording overall profit of $811 million (compared with  $135 million in 2013).

Tom Mitchell, OPG’s retiring president and CEO, said the Darlington nuclear plant provided higher production than usual this year while the Pickering plant had “solid performance.”

He said Darlington makes an “essential contribution” to the province’s power mix, and promoted the upcoming $10.2-billion refurbishment project.

“Darlington operates safely and replaces power sources that would contribute to climate change,” he said in a statement. “Refurbishing the station will allow it to continue to operate for another 30 years and will create thousands of jobs at the plant and at companies across Ontario.”

The new power generation came from units on the Lower Mattagami River and the Atikokan and Thunder Bay generating stations that have been converted to biomass and have come online earlier than projected.

OPG says it received an average of 6.1 cents per kilowatt hour for its power in the second quarter of 2015.

One downside for OPG in 2015 is the nuclear waste management business, which recorded a loss before interest and income taxes of $72 million in the first half of the year (in the same period in 2014, the loss was $10 million).

“The decrease in earnings…was primarily a result of lower earnings on the nuclear funds due to unfavourable market conditions, and a lower Ontario Consumer Price Index which unfavourably affected OPG’s rate of return on the Used Fuel Segregated Fund,” the company said.

The estimated $10.2-billion refurbishment of Darlington’s four reactors is scheduled to begin late next year. The government has started exploring regulatory options for keeping power prices stable2 while the work takes place.

References

  1. www.qpbriefing.com/2015/03/13/opg-earns-net-profit-of-811-million-for-2014
  2. www.qpbriefing.com/2015/08/19/government-trying-to-get-a-handle-on-darlington-overhaul-costs

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Capital Markets News Roundup – Week of August 17

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Manufacturing.

  • Toronto-based Alliance Corporation, a manufacturer and distributor of equipment for wireless companies, secured $154M from Ironbridge Equity Investments. 

Tech.

  • Waterloo-based KIK, a mobile chat platform, secured $50M from China’s Tencent.

Fintech.

  • Vancouver-based Grouplend, an online alternative financing platform for small business, secured $10.2M in Angel investment.

Pharmaceuticals.

  • Vancouver-based Delmar Pharmaceuticals secured $2.6M in post-IPO equity funding.

Canada’s KIK receives $50M in Series D Funding from China’s TenCent

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Canadian tech company KIK took one step closer to reaching “unicorn” territory after attracting a massive $50M investment from Chinese giant TenCent last week.

Quick Facts.

  • KIK is a chat-based application based in Waterloo Ontario. The platform allows users to connect, talk, and share interests and content across accounts.
  • The raise brings KIK’s total funding to $120.5M raised through 5 rounds.
  • TenCent is the largest Internet company in China, and has its own line of popular web and mobile apps, including WeChat.
  • The investment represents a strategic partnership between KIK and TenCent to bolster competition with major chat applications.
  • News sources report that, with this deal, KIK’s valuation is approaching the $1 billion mark.

  • Unicorn is a term used in the investment sector to describe a startup that has reached a valuation of more than $1 billion.

 

 

U.S on track to break $70B in venture capital funding for 2015

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Venture capital (VC) investment in the United States is set to surpass the $70B level in 2015 due in part to low interest rates and strong corporate sector investment, KPMG reported last week.

Quick Facts.

  • The forecast comes from KPMG’s inaugural Venture Pulse report; a quarterly publication on global VC activity.
  • According to the report, the U.S. has seen more than $15B invested per quarter in four of the last five quarters, including more than $18B in both first quarters of 2015.
  • VC activity has been largely driven by low interest rates, strong participation by corporate investors, and new sources of capital, such as hedge and mutual funds.
  • In the past year, Internet companies have dominated the marketplace of VC-backed deals (45%), followed by Mobile & Telecommunications (16%), Healthcare (14%), Non-Internet/Mobile Software (6%), Consumer Products & Services (3%), and all other sectors (15%).
  • VC Funding activity in the U.S reached a record high of $56.4B in 2014.

Are you a business seeking capital? SEARCH our database of U.S. government incentive programs now.

Ontario invests in 3M, Hanon Systems via Eastern Ontario Development Fund

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Ontario’s 3M and Hanon Systems have secured more than $1.4M in funding from the Eastern Ontario Development Fund (EODF) to support job creation, the Government of Ontario announced Thursday.

Quick Facts.

  • 3M Canada secured a grant of $549,000 towards its $5.49M dollar project to commercialize new personal protective technology while adding 10 new jobs and retaining 103 existing jobs in Brockville Ontario.
  • Hanon Systems also secured a grant of $868,800 towards its $8.69M project to diversify its products for automobile cooling systems. The project will create 70 new jobs while retaining 340 existing jobs in Belleville, Ontario.
  • Ontario is accepting applications for EODF from businesses that are growing and creating jobs. Eligible sectors include: advanced manufacturing, processing, life sciences, information and communications technology, tourism and cultural industries.
  • EODF will fund up to 15% of activities on projects of up to $1.5 million. Companies seeking funding are expected to contribute a minimum of 50% of total project costs.
  • Since 2008, the Ontario government has committed more than $70 million through the EODF, leveraging a total investment of more than $700 million

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