The Bennett Jones private equity group is a leader in Canada. Our clients include sophisticated financial sponsors who are looking to balance risk with expected return and who require tailored advice from the initiation of the investment phase through to exit. Bennett Jones represents all sides in private equity transactions, with particular depth on behalf of U.S. and domestic financial sponsors. We understand our clients live with the consequences of their acquisitions the moment the deal closes—and we align ourselves with that mindset.
Our practice is a collaborative and multidisciplinary effort that draws upon the firm’s strengths in Mergers & Acquisitions, Capital Markets, and acquisition finance (Financial Institutions Group), along with subject matter expertise in domestic and cross-border issues relating to Tax, Anti-Trust/Competition, Environmental, Social and Governance (ESG), Employment & Benefits, Information Technology, Intellectual Property and International Trade.
How We Help Private Equity Clients
Our Strengths
- Navigating the Canada-U.S. border effectively and efficiently is one of our major strengths. We act for a wide range of clients, including financial sponsors, Canadian pension funds, family offices and other institutional investors—meeting their diverse needs. Our longstanding relationship with a number of leading U.S.-based sponsors and their U.S. legal counsel has given us particular insight into the cross-border tax challenges that come with structuring investments in Canada and from the United States and the nuances that stem when representing tax-exempt investors.
- Our private equity team works closely with our industry experts in those industries where our firm excels—particularly in energy/renewables, infrastructure, real estate, agribusiness, mining, technology, consumer and hospitality—to ensure that we are delivering the most informed advice. With a growing focus for private equity investments on ESG issues our expertise is vital from the initial diligence stage through to post-investment monitoring. We also have a leading Public Policy Group that adds significant value, particular with respect to cross-border situations that can stand to benefit from that type of perspective.
- Transaction structuring is an important strength as Bennett Jones understands that excellence in the field requires specific knowledge of investors' needs at each point in the capital structure. Knowing how to bridge views on valuation and de-risk certain situations, with the use of earn-outs, convertible securities, contingent value rights (CVRs), derivatives and other forms of structured products, is a key value we bring to transactions.
- Bennett Jones is focused on the process of value creation, and the importance of actual cash-on-cash returns to our clients. Understanding the time value of money, and the underlying pressures and constraints facing our clients, allows us to effectively interface with counterparties and their counsel. We have dedicated training programs for our lawyers on topics such as valuation, financial statement analysis and portfolio management, and believe that this important investment in our people is reflected in the service we provide.
Transactional Experience
Bennett Jones has comprehensive experience in every aspect of transactional work for private equity investors, including:
- private mergers and acquisitions, beginning with strategic advice on competitive bid processes, cross-border structuring and execution;
- leveraged buy-outs (LBOs) and management buy-outs (MBOs);
- going private transactions and private investments in public companies (PIPEs);
- special Purpose Acquisition Vehicles (SPACs), including cross-border "de-SPAC" transactions;
- recapitalizations and restructurings, both in and outside of a formal court process;
- acquisitions from bankruptcy and distressed investments;
- carve-out transactions;
- co-investment 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. We have advised on some of the largest and most complex Canadian and cross border private fund formations, across all asset classes and strategies, including buyout, growth, venture, mezzanine, infrastructure, private credit, farmland, water, timber and funds of funds.
Our extensive experience with the investment fund life cycle has helped us to develop a thorough understanding of fund formation and investment from a variety of perspectives, including the registration and regulation of investment, advising and managing activities, that enables us to provide clients with a practical, market-based perspective on structuring and deal dynamics.
Our clients include:
- Canadian and international pension funds (including public and corporate pension funds);
- private equity and other investment fund sponsors;
- family offices;
- public and private charities;
- university and other institutional endowments;
Our representation of a broad base of clients allows us to advise on the complex issues that are involved in the fund formation process, as well as to offer insight on market trends and strategies for a variety of alternative investment funds across various industries.
The Bennett Jones fund practice includes:
- structuring and advising closed-ended investment funds and underlying investments for asset managers in private equity, real estate, infrastructure, renewable resources and private credit, mining and agribusiness;
- particular strength in advising U.S. and offshore investment managers in connection with fundraising efforts and securities registration compliance in Canada;
- advising on the structuring and negotiating of co-investments, syndicated investments and GP led secondary transactions;
- structuring and advising open-ended private funds and the establishment of hedge fund platforms with a thorough understanding of absolute return strategies;
- advising investors on all types of direct and indirect investments and drafting and negotiating all types of investment agreements, including: limited partnership agreements, trust agreements, co-investment and shareholders' agreements and side letters with a particular focus on structuring management fees, carried interest payments and complex distribution waterfalls;
- all matters relating to registration of investment funds (and fund advisors and managers) in Canada and related ongoing compliance; preparing of fund governing and offering documents, investment policies and advice on governance and ESG matters;
- providing tax and structuring advice to our international fund clients in connection with the establishment of parallel and feeder funds organized as Canadian 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; and
- vast experience with the special issues applicable to tax exempt government and corporate pension fund investors.
Private Equity Financing and Private Credit
The Bennett Jones debt finance group provides complete coverage for leveraged private equity transactions and has a deep understanding of cross-border private equity credit markets, acting as primary counsel to financial sponsors and borrowers on numerous leveraged acquisitions. Our depth and breadth of experience in both bank finance and private credit allows us to offer clients strategic advice on financing conditions and commitment paper terms which can give them an advantage in competitive auctions.
Bennett Jones has developed one of the most sophisticated private credit teams in Canada by advising top U.S., foreign and Canadian alternative lenders (private credit), pension funds, borrowers and sponsors on a range of matters including large, syndicated senior debt financings, high value bespoke private placements, mid-market asset-based and senior and mezzanine commercial loan transactions.
Our market leading private equity finance team is both forward and outward looking, with experts that have worked at major U.S. and international law firms prior to joining Bennett Jones. Familiarity with the U.S. credit market and methods means we are uniquely placed to advise international private equity clients on financing matters.
Our private equity finance services include:
- leveraged finance, including Canadian and cross-border loan and credit facilities;
- acquisition financings;
- alternative lender led financings, including sponsor debt investments;
- public and private high-yield bond offerings;
- syndicated loan financings;
- asset-based financings;
- first and second lien financings;
- unitranche and mezzanine financings;
- cross-border, foreign and multicurrency financings;
- complex inter-creditor arrangements; and
- restructurings and workouts.
Preparation for Exit
Private equity always moves forward and Bennett Jones is frequently called upon to assist companies and investment funds on the last step of the investment cycle—the exit. Anticipating the exit, the importance of cash-on-cash returns and the time value of money to financial sponsors, plays a critical role in the negotiation and execution of the original investment itself.
Understanding the importance of a clean exit is integral to 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:
- running and facilitating the entire suite of legal issues for a competitive auction process for the sale of a company;
- 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;
- MBOs, asset and or share sales pursuant to an M&A process or strategic acquisition; and
- Secondary Transactions.
Bennett Jones