Daily News: August 25, 2017

Royalty North Supports AcquirCo Acquisition of Advanced Wire

Royalty North Partners has entered into a loan agreement with AcquirCo, a newly formed entity based in British Columbia, which will purchase the outstanding shares of Advance Wire Products.

Immediately upon completion of the acquisition, AcquireCo and Advanced Wire Products will amalgamate, with the amalgamated entity, AWP, continuing to operate the purchased business.

Under the terms of the agreement, RNP will loan C$6.8 million ($5.44 million) to AcquireCo upon receipt of all authorizations required in connection with the loan and completion, to its satisfaction, of its due diligence review and review of the terms of the acquisition. The loan will be repaid by way of monthly loan payments equal to a minimum annual loan payment plus a percentage of the gross sales of AWP.

Justin Currie, CEO at RNP, said, “We are pleased to be able to support the management buy-out of a local high-quality legacy business. The management team has been successfully operating the business for the last number of years and it makes a lot of sense to see them in a position of ownership.”

Michael McAdam, the future president of AWP, said, “We are excited to be partnering with RNP on this transaction as their financing structure is particularly well-suited to management buy-out situations. They are a value-add partner who is aligned for growth and will allow us to acquire a 100% equity interest in the Target while maintaining reasonable debt service levels and without numerous restrictive covenants.”

AWP, headquartered in Surrey, BC, has been specializing in the design, prototyping and manufacturing of display fixtures and merchandising solutions since 1953.

Royalty North Partners is a Vancouver, BC based, company focused on creating a diversified portfolio of cash flowing royalties by providing financing to private businesses operating in the middle market.