Private Equity Investing in Canada: Avoiding the Pitfalls

While the Canadian market is increasingly seen as an attractive one for U.S. private equity investors, real success depends on identifying the substantive differences between the two regimes and structuring the investment accordingly.

American private equity funds have become major players in the Canadian marketplace and have figured prominently in a number of recent large transactions north of the border.

To name a few examples: Bain Capital, LLC, along with the Beaudoin family and the Caisse de dépôt et placement du Québec, formed a consortium which, in December 2003, acquired the recreational products division of Bombardier Inc. for C$960 million. This summer, another investor group led by Hicks, Muse, Tate & Furst acquired Persona Inc., Canada’s sixth largest cable television operator, for C$400 million.