Private Equity & Investment Funds

Bennett Jones has been recognized as a leading private equity law firm representing Canadian and U.S. investment funds, financial sponsors and their portfolio companies in all areas of their business, with a principal focus on mergers and acquisitions, public and private treasury investments and the formation of private investment funds. The firm's strengths in private equity spans a number of industries—including natural resources, industrial services, food and beverage, hospitality, consumer products, energy services, technology and transportation—providing us with familiarity with particular regulatory regimes, industry dynamics and capital structures.

How We Help Private Equity Clients

Transactional Experience

From our roots as Canada’s premiere national law firm in the oil and gas industry and energy infrastructure space, Bennett Jones has grown into a go-to law firm for many of the most sophisticated private equity firms in Canada and the United States. Our understanding of the broader macroeconomic setting allows us to provide particular expertise and value to private M&A transactions and investments that are taking place anywhere inside or outside of Canada. The goal—to assist our clients in sourcing, evaluating and negotiating transactions in a timely and a tax-efficient manner, with a special view to the importance of the nuances and needs of the investment management business. The Bennett Jones private equity practice is a collaborative effort that draws upon the firm’s strengths in mergers and acquisitions, capital markets, domestic and cross border tax structuring, antitrust/competition, finance, employment, real estate, environmental, privacy/data compliance and intellectual property experience. Bennett Jones has comprehensive experience in every aspect of transactional work for private equity clients, including:

• Private mergers and acquisitions, beginning with strategic advice on competitive bid processes, cross-border structuring and execution;
• Going private transactions and private investments in public companies (PIPEs);
• Leveraged buy-outs (LBOs) and management buy-outs (MBOs);
• Recapitalizations and restructurings, both in and outside of a formal court process;
• Acquisitions from bankruptcy and distressed investments;
• Carve-out transactions;
• Investment fund consortium arrangements; and
• Real time transaction support comprised of top tier commercial litigators, a best-in-class governmental affairs group and a responsive shareholder activism/critical situations team.

Fund Formation

Fund formation and investment management is a cornerstone practice group at Bennett Jones. Our representation of financial sponsors as well as institutional investors, pension plans, endowments and family offices offers us insight into market trends and enables us to regularly advise on the formation and structuring of private funds, co-investments and related fundraising processes. These mandates typically require us to be involved with the economic structuring of management fees, carried interest payments, complex distribution waterfalls, and the negotiation of side letters with investors. We regularly provide tax and structuring advice to our offshore fund clients in connection with the establishment of parallel and feeder funds organized as Canadian investment vehicles. We also advise U.S. and offshore investment managers in connection with fundraising efforts in Canada. Our fund formation practice highlights:

• Substantial corporate and tax experience structuring closed-ended investment funds and underlying investments for asset managers in private equity, real estate and infrastructure;
• Substantial experience working with open-ended private funds; the establishment of hedge fund platforms and a thorough understanding of absolute return strategies;
• Routinely advise in connection with the structuring and negotiating of co-investment and alternative investment vehicles;
• Experience with issues relating to U.S. investors and investments into the U.S. by Canadian investment vehicles (FATCA, FIRPTA, Section 892 of the Internal Revenue Code in connection with tax-exempt investors, UBTI, CFC structuring and other matters relating to the creation of “blockers”) and U.S. and offshore funds investing into Canada,
• Matters relating to registration of investment funds (and fund managers) in Canada and related ongoing compliance; and
• A thorough understanding of the special issues applicable to an important part of our client base: government and pension fund investors.

Acquisition Financing

Bennett Jones routinely advises on the domestic and cross-border loan facilities and other forms of leveraged finance. In the private equity realm, our broad experience and expertise in this area ranges from large, syndicated cash-flow senior debt financings arranged by both domestic and foreign banks to mid-market asset-based and senior and mezzanine commercial loan transactions. Our team has been primary counsel acting for financial sponsors and borrowers on a number of leveraged acquisitions in the Canadian market.

Preparation For Exit

Private equity always moves forward and Bennett Jones is called upon to assist investment funds in the last step of the investment cycle—the exit. Anticipating the exit, and the importance of cash-on-cash returns to financial sponsors, plays a critical role in the negotiation and execution of the original investment itself. Understanding the importance of a clean exit must be contemplated when structuring shareholder arrangements, incentive plans and subsequent liquidity rights (i.e., registration rights). Bennett Jones brings that knowledge and approach to bear, commencing at the term sheet level of an initial investment. We have helped domestic, U.S. and international investment funds on numerous exits, including through:

• Initial Public Offerings (IPOs) on a Canadian, U.S. or international stock exchange;
• Reverse Takeovers (RTOs) and Qualifying Transactions on the TSX, TSX-Venture or other Canadian exchanges;
• Asset and or share sales pursuant to an M&A process or strategic acquisition; and
• Secondary Transactions.