Advent-owned BOS Solutions seeks up to C$104 mln in public debut

BOS Solutions Holdings, a provider of liquids-solids-separation services, priced its recently filed initial public offering. It is the latest in a series of private equity and venture-backed issues that are helping rally Canada’s IPO market.

Calgary’s BOS, owned by Advent International, plans to raise as much as C$104 million (US$77.8 million) from the sale of 9.4 million common shares at C$11 to C$14 per unit, the updated prospectus shows.

Founded in 2002, BOS offers solutions to recycle fluids, reduce associated waste for disposal and manage environmental issues. Its customers are in North America’s oilfield industry and other industrial markets.

The company reported revenue of C$52 million for 2016, down from pre-2015 highs due to reduced oilfield activity. It has accumulated market share, however, and expects to benefit from continued recovery in the price environment.

The lion’s share of the IPO’s proceeds will go to BOS. They will be used to repay debt, for working capital, and to fund capital expenditures, potential acquisitions and other priorities.

Advent, which acquired BOS in 2010, will sell some shares via the IPO’s greenshoe option. Upon its completion, Advent will remain the majority investor, holding a 56 percent stake, according to the updated prospectus.

BOS will list on the Toronto Stock Exchange. The IPO is being underwritten by CIBC World Markets, BMO Nesbitt Burns, National Bank Financial, TD Securities, AltaCorp Capital, HSBC Securities (Canada), Peters & Co and Raymond James.

IPO parade

BOS is the eighth Canadian PE- or VC-backed company to announce or complete a public sale since January.

Four wrapped up their IPOs. Freshii, a health-food restaurant chain backed by Klass Capital, secured C$144 million in February. In the same month, Fairfax Africa, an investment vehicle of Fairfax Financial Holdings, took about C$74 million.

They were followed by the IPO of outerwear apparel brand Canada Goose, owned by Bain Capital, which pulled in C$390 million in March.

Canada Goose, Freshii and Fairfax Africa were the headline IPOs in the first quarter, according to PwC. Thanks mostly to them, Canada’s IPO market rebounded from a lackluster 2016. New issues attracted C$571 million in Q1 2017, the second-best first-quarter result in the past decade.

Since then, fracturing-sand producer Source Energy Services, backed by TriWest Capital Partners, closed its IPO, raising C$175 million. It may see more than C$200 million once the greenshoe option is exercised.

Another oilfield-services provider, STEP Energy Services, owned by ARC Financial Corp, filed to go public in February. It has reportedly postponed the event, however, because of recent volatility in oil prices.

VC-backed IPOs return

This month, Canadian tech companies held by venture capital firms staged a public-market comeback.

The first was biotherapeutics provider Zymeworks, which filed to go public in both Canada and the United States. Terms have not been set. A U.S. regulatory filing noted a placeholder offering size of C$100 million.

Zymeworks accounted for one of Canada’s largest VC financings in 2016. It took about C$87 million in a Series A round led by BDC Capital and Lumira Capital and joined by multiple other investors, including Eli Lilly and CTI Life Sciences Fund.

Shortly after Zymeworks’ filing came the much anticipated IPO of Real Matters, a cloud real estate technology platform. It also has not been priced. Bloomberg earlier reported the company is seeking C$125 million.

Real Matters was also responsible for a big round last year. It raised C$100 million from a mix of public and private investors, including Whitecap Venture Partners. Wellington Financial is among its other backers.

Real Matters and Zymeworks are Canada’s first VC-backed IPOs in two years, according to Thomson Reuters. The last major public debut was Shopify’s in 2015. The e-commerce company secured about C$188 million.

Action Item: Contact the company: www.bos-solutions.com/index.php/contact

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