7 acquisition process

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Unformatted text preview: .................................................................................- 6 OVERVIEW OF THE ENVIRONMENTAL SECTORS ....................................................- 7 ACQUISITION PROCESS ...................................................................................................- 10 INVESTECO - PAST INVESTMENTS ..............................................................................- 13 INVESTECO............................................................................................................................- 15 PRINCIPALS...........................................................................................................................- 15 SUMMARY OF PARTNERSHIP AGREEMENT .............................................................- 16 RISK FACTORS .....................................................................................................................- 24 CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS .................- 29 LEGAL AND REGULATORY CONSIDERATIONS ......................................................- 32 - INVESTECO PRIVATE EQUITY FUND III, L.P. Up to CAD $100,000,000 EXECUTIVE SUMMARY The Partnership Investeco Private Equity Fund III, L.P. (the “Partnership”) is an Ontario limited partnership formed as of July 8 2008, the general partner of which is Investeco General Partner III Corp. (the “General Partner”), an Ontario corporation. One or more separate partnerships or other entities may also be established for non-residents of Canada and others (each a “Parallel Partnership”, and together with the Partnership, the “Partnerships”), which are intended generally to invest on a pro-rata basis with the Partnership based on their respective final unit commitments, subject to legal, tax and regulatory considerations. Offering The offering pursuant to this Offering Memorandum (the “Offering”) is of limited partnership units (“Units”) aggregating up to CAD $100,000,000, or such lesser or greater amount as determined by the General Partner in its sole discretion. The offering period will end 12 months following the Initial Closing, or such earlier or later date as the General Partner determines appropriate. The minimum investment commitment for individual investors is $250,000, and for institutional investors is $2,000,000, or such lesser amounts as the General Partner may determine are appropriate from time to time. Investment Objective The Partnership has been established for the purpose of acquiring interests primarily in Canadian-based companies operating generally within the environmentally driven industrial sectors of renewable energy, water, sustainable agriculture and clean technologies (the “Environmental Sectors”) or similar sectors. Investment Strategy The General Partner intends that approximately 95% of the Partnerships’ resources will be applied to investments of up to approximately $15 million (including follow-on investments). These investments will generally be made in Canadian-based companies (although US-based companies will be considered) that the General Partner believes to have established revenues, good management and long term competitive advantages, as well as the prospect of providing a profitable exit opportunity within 4 to 7 years from the date of initial investment. Although the Partnership will have a preference for profitable companies, it may also invest in companies that are not yet profitable. The General Partner further intends that up to approximately 5% of the Partnerships’ resources will be applied to investments of between $250,000 and $1 million in “seed stage” private companies. (such investments, collectively with investments described in the paragraph above, “Portfolio Investments”). The General Partner expects that these investments will generally be made in Canadian based companies (although US-based companies will be considered) that the General Partner believes to have excellent growth prospects and -1- management, and which the General Partner believes can likely provide a profitable exit opportunity within 4 to 7 years from the date of investment. The Environmental Sectors The Environmental Sectors are expected by the General Partner to continue to grow rapidly in coming years, primarily due to increasing resource scarcity, population growth, and environmental stresses. Basic commodities such as energy, food and clean water are expected to become increasingly scarce and expensive, and companies with more resource efficient or cleaner technologies and processes, or that produce environmentally superior products and services, are expected to be well positioned compared to those that do not. Acquisition Process Taking advantage of the General Partner’s proprietary access to potential transactions, the Partnership intends to acquire investments using a process consisting of due diligence, structuring an appropriate investment transaction, working to create value in the investment, and working to realize the value created. The Manager The Manager is intended to be Investeco Capital Corp., an Ontario corporation of which the General Partner is a wholly-owned s...
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