Alaris Equity Partners Income Trust has closed a C$115.02 million bought-deal public offering, raising additional capital to reduce debt and support future investments in private companies.
The Calgary-based investment firm issued 5,134,750 trust units at C$22.40 per unit, including 669,750 units sold after the underwriters exercised their overallotment option in full.
The offering was led by CIBC Capital Markets, Acumen Capital Finance Partners, and National Bank of Canada Capital Markets.
Other participating underwriters included Raymond James, Desjardins Capital Markets, RBC Capital Markets, ATB Capital Markets, and Canaccord Genuity.
Alaris plans to use the net proceeds to partially repay outstanding indebtedness under its senior credit facility.
The company may subsequently redraw amounts under the credit facility to finance investments in new partner companies and for general trust purposes.
The financing increases the capital available to Alaris as it continues pursuing structured equity investments in private businesses.
Alaris typically provides capital to companies seeking financing for management buyouts, dividend recapitalizations, acquisitions, and growth initiatives.
Rather than operating its portfolio companies directly, Alaris invests through wholly owned acquisition entities and receives distributions, dividends, interest, and potential capital appreciation.
Its investment model is designed to produce recurring cash flows while giving portfolio companies access to capital without relying exclusively on traditional debt financing.
The company generally structures investments using preferred and common equity interests.
Certain distributions received from partner companies are adjusted annually based on changes in a top-line financial performance measure, such as gross margin or same-store sales.
These distributions generally rank ahead of common equity distributions, giving Alaris a differentiated position in the capital structures of its partner companies.
The latest offering provides additional balance sheet flexibility as the company evaluates new investments.
By initially applying the proceeds to outstanding borrowings, Alaris can reduce leverage while maintaining the option to redraw capital if attractive investment opportunities emerge.
The financing also demonstrates the company’s continued access to public capital markets as it seeks to expand its portfolio of private company investments.
The trust units sold in the offering have not been registered under the U.S. Securities Act of 1933 and were not offered publicly in the United States.
Alaris’ broader strategy remains centered on investing in established private businesses that require capital while allowing existing management teams to continue operating their companies.
The company seeks to generate predictable distributions for unitholders while increasing net book value through appreciation in its underlying investments.
