Fulcrum Capital acquires majority stake in Weatherhaven

TORONTO, June 4 Wed Jun 4, 2014 12:47pm EDT

TORONTO, June 4 (Reuters) - Canadian private equity firm Fulcrum Capital Partners said on Wednesday it has acquired a majority interest in privately-held Canadian defence and infrastructure firm Weatherhaven Global Resources, a maker of portable shelters.

The two parties did not disclose the terms of the deal, but said Weatherhaven's founding shareholders are stepping back and will assume an advisory role while its current management team, led by CEO Ray Castelli, have reinvested and will continue to lead the firm.

Last year, the Burnaby, British Columbia-based Weatherhaven engaged an M&A firm in the defence and aerospace industry to assist in identifying a financing partner. The company said it received over a dozen competitive bids, but chose Fulcrum due to its Canadian heritage and track record of growing small and medium-sized companies.

Fulcrum said its decision to invest in Weatherhaven was tied to Canada's announcement of a new defence procurement strategy this year. It said Weatherhaven has enjoyed tremendous growth in the last six years, and with new shelter designs, the company is poised to build on this trajectory.

Last month, Fulcrum was one of two winners of the Canada Venture Capital & Private Equity Association (CVCA) deal of the year award for 2014 for its investment in A&B Rail Services Ltd, a rail track construction and maintenance firm.

In 2008, Fulcrum invested C$9.6 million to buy a controlling interest in A&B Rail. It aggressively grew the business along with the A&B Rail management team and in 2013, Fulcrum sold A&B to a private equity investor group led by TorQuest Partners, realizing total cash proceeds of C$137 million.

Fulcrum's larger rival Brookfield Asset Management was the other winner of the CVCA award for its bet on Longview Fibre Paper and Packaging. In 2013, Brookfield sold Longview to KapStone Paper & Packaging Corp and realized proceeds of about $1.1 billion. (Reporting by Euan Rocha; Editing by Sofina Mirza-Reid)

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