The Caisse de dépôt et placement du Québec has announced the creation of two new funds that should help push companies forward as they seek out international markets, and when retiring leaders turn companies over to successors.

The new Fonds Croissance CDPQ and Fonds Relève CDPQ are worth a combined $500 million. They’ll support companies seeking to grow through international expansion or those having reached the business transfer stage.

“We have been supporting Québec companies in their international expansion projects for several years already. More recently, we have seen how tapping into our networks and connecting our partners, the companies in our portfolio and our experts on the ground can make a difference,” said executive vice-president of Quebec at the Caisse, Christian Dubé. “We have strengthened our teams to be able to go even further in the support we offer, over and above financing. By creating this fund, we wanted to structure and streamline our approach and pool resources to truly accelerate the growth of Québec companies in the global marketplace.”

“We also decided to establish a fund dedicated to business transfer, a niche in which we intend to play an even more active role. Knowing that 30 per cent of Québec business owners will retire and look to transfer their business to a successor within the next six years, we are convinced that this fund is essential. Our goal is to bring concrete solutions and provide customized support to these companies to ensure they are sustainable and successful,” added Dubé.

The $250 million Fonds Croissance CDPQ will invest by increments of $10 to $100 million. The Fund will target public and private companies with annual revenues between $50 and $500 million and with a “clear international growth strategy.”

With the exception of real estate, all business sectors are eligible.

Targeted growth projects include, for example, acquisitions that would allow a company to get closer to its existing and potential customers or attain a critical mass in its industry.

Meanwhile, the $250 million Fonds Relève CDPQ will target business transfer projects, investing between $10 and $100 million, primarily in the form of equity. It would be in public and private companies with annual revenues between $50 and $500 million and an investment structure “that allows la Caisse to be a long-term partner throughout the life of the company.”

With the exception of real estate, all business sectors are eligible.

This fund may finance, for example, a business transfer project, allowing its founder to monetize a portion of his property while supporting the successor – whether family-related or not – involved in the transition. La Caisse will propose tailored investment and support solutions to facilitate the transfer.

“These two new funds are additional vehicles to help us build the next generation of Québec’s successful businesses, while generating a return that meets our clients’ needs,” said Dubé.

The Caisse de dépôt et placement du Québec (CDPQ) is a long-term institutional investor that manages funds primarily for public and parapublic pension and insurance plans. It holds $254.9 billion in net assets.

(Photo: LE DEVOIR)