The Minister of the Economy, Pierre Fitzgibbon, confirmed yesterday the granting of a maximum sum of $75 million to a private fund whose objective is to help SMEs battered by the pandemic, estimating that Investissement Québec ( IQ) does not have the skills to do so.
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“The transformation of models [d’affaires]it is not expertise that we can have internally at Investissement Québec, we are talking regarding sectors that are very diversified, “said Mr. Fitzgibbon yesterday at a press conference in Montreal.
Since the CAQ came to power in 2018, the government has nevertheless significantly increased funding for IQ, which has resulted in a 37% increase in the number of employees of the state-owned company.
In addition, the Ministry of the Economy has granted no less than $1.2 billion in financial assistance to businesses since the start of the pandemic.
Quebec will invest $50 million in the DNA Continuity Fund and might put an additional $25 million into it over the next few years. The fund will be managed by investment bank DNA Capital, founded in 2009 by financier Daniel Labrecque.
“Some of our promising businesses are coming out tired from this extraordinary pandemic effort,” said Pierre Fitzgibbon.
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Secret investors
About sixty private Quebec investors will contribute $50 million to the fund for an initial capitalization of $100 million. Their identity will remain secret.
“For us at Investissement Québec, to co-invest with people like that, let’s say I’m going to sleep well at night,” said Mr. Fitzgibbon.
According to him, encouraging wealthy Quebecers to invest in local businesses is part of the government’s mission.
The minister admitted that he knew Mr. Labrecque and Stéphane Léveillé, a former employee of the Caisse de depot who will act as CEO of the DNA Fund, as well as several of the private investors.
“I know a lot of people in the business world in Quebec,” he noted.
About 2% for management
The government and private investors will pay DNA Capital, each year, approximately 2% of the sums invested for the management of the fund, specified Daniel Labrecque.
The fund will offer the companies in which it invests the support of seven “advisor-investors”: Anna Martini, Chief Financial Officer of Groupe CH (Canadian of Montreal); Gérard Geoffrion, former CEO of coffee roaster Van Houtte (now owned by the American Keurig), Luc Sabbatini, president of PBSC Urban Solutions; Marc-André Aubé, CEO of Walter Surface Technologies (owned by Ontario’s Onex); Marie-Pier St-Hilaire, president of Edgenda; Martin LeBlanc, CEO of CellCarta (owned by the American Arsenal Capital) and Yves Leduc, ex-CEO of Velan.
