Stikeman Elliott has been an active, long-standing participant in the Canadian private equity and venture capital markets. We regularly represent private equity funds, venture capital funds, pension funds, merchant banks, hedge funds, investors and organizations seeking investments, as well as principals wishing to raise new or additional private equity, both within Canada and internationally.
We also advise clients whose shareholders include private equity and venture capital funds and clients that were formed as management buyouts assisted by private equity funds. We have also advised numerous pension plan clients and other regulated entities in connection with their investments in private equity and venture capital funds, both in Canada and internationally. Understanding each of these perspectives has been critical to our ability to provide strategic advice on all elements of private equity and venture capital investing.
Our practice includes acting on large, medium and small buyout transactions (for both buyers and sellers), private equity and venture capital investments, fund formation and mediating shareholder and partnership disputes.
Recognition for Our Work
Ranked Band 1 for Private Equity and M&A (Chambers Global).
Tier 1 firm in M&A (IFLR1000, The Legal 500).
30 ranked lawyers in Private Equity in Canada (The Canadian Legal Lexpert Directory 2016).
2017 M&A Law Firm of the Year - Canada (Best Lawyers).
2016 Canadian Law Firm of the Year (IFLR Americas).
#1 Canadian firm for M&A by deal count (Bloomberg, Mergermarket and Thomson Reuters 2016).
Top ranked Canadian firm in Private Equity for Global buyouts, U.S. buyouts, and U.S. buyouts and exits by deal value (Mergermarket 2016).
Stikeman Elliott has acted on a number of buyouts for private equity clients, which are often a complex series of transactions. We are able to leverage our considerable experience in private M&A transactions, tax, banking and management arrangements.
When Acting For Buyers
- Assisting in the development of the appropriate strategy for auction participation
- Structuring and executing the complex financing and debt structures associated with such transactions
- Structuring transactions to address particular regulatory concerns
- Documenting arrangements between management, shareholders and investors
- Advising with respect to compensation issues
- Performing due diligence
- Advising on any resulting tax, regulatory, financing, securities and accounting issues
When Acting For Sellers
- Advising on establishing the appropriate process
- Establishing data rooms and due diligence
- Assisting in arranging appropriate insurance
- Negotiating transaction documents
Making Private Equity Investments
Stikeman Elliott has a broad range of experience acting for investors making investments in private companies. The breadth of our experience gives us a particular insight into the myriad of potential arrangements that can be entered into among investors, and between investors and the investee company, pertaining to corporate governance, fundamental rights, structure of the investment and exit rights. We have expertise structuring transactions, including angel, seed, early and late stage, bridge, convertible, debt, follow-on and mezzanine and subordinated debt investments, private placements into public companies, PIPEs, leveraged and management buyout financings, and rollup acquisition financings as well as restructurings and reorganizations. We work with clients through all aspects of these transactions, from identifying investment opportunities and sources of capital to implementing exit strategies, including mergers and acquisitions, trade sales, IPOs (including via income trusts), and public market sales.
Establishing a Fund
Stikeman Elliott has developed a strong reputation for assisting individuals in establishing a fund as we understand the complexities of the legal and business issues facing investors as well as the market at any particular point in time. We also have contacts at a number of financial institutions that regularly invest in funds, and at other funds of funds.
An essential element of the establishment of a fund is the development of an appropriate governance structure and the negotiation of investors' rights and management compensation.
Another crucial component in fund formation is tax structuring to ensure appropriate tax treatment for the fund and its investors. Stikeman Elliott has a well-known and highly regarded tax group to assist with these structuring issues.
In addition, our international network of offices makes us particularly well suited to handle international fund formation and in particular, the investment by non-resident investors in Canadian funds, cross-border investment and the sourcing of investment opportunities.
We regularly act in connection with:
- Fund creation and maintenance, including U.S. funds investing into Canada and Canadian funds investing into the U.S.
- Labour-sponsored investment funds
- Private and public limited partnerships
- Closed and open-ended investment trusts and corporations
- Fund management, placement agency and advisory agreements
Given our expertise in acting for private equity funds, we routinely act for both investee companies and management who are looking for private equity partners. In addition to introducing our clients to a broad range of potential private equity partners, we have extensive experience in structuring arrangements with private equity partners, including the negotiation of appropriate compensation and equity participation for management, and in structuring arrangements between members of the management group.
An essential element in all private equity investments is the occurrence of a liquidity event. Stikeman Elliott has a strong reputation in the public markets environment in both conventional and income trust initial public offerings as well as M&A transactions, both domestic and cross-border.
Should a dispute arise between the private equity investor and management of the portfolio company or if the investment fails, we are able to assist in a number of ways including: enforcing special contractual remedies; invoking statutory oppression, appraisal, derivative, investigative and compulsory winding-up remedies; and, seeking resolution through mediation or arbitration.