Alaris recapitalizes up to 85% of the equity in lower middle market companies in North America through non-control, preferred equity investments.
We invest in private businesses in Canada and the United States through a combination of a non-control perpetual preferred equity and common equity.
Business Owners have used Alaris to buyout their exiting shareholders and in the process, consolidate 100% of the common equity in their business where they have the ability to control the operations, strategic vision, culture and time horizon all while benefiting from the majority of the upside in the growth that they deliver.
Business Owners who are looking to eliminate refinancing risk, have access to follow-on capital from a true long term equity partner and want to benefit from the majority of the upside from the growth that they deliver, have used Alaris to recapitalize their balance sheet.
Business Owners who have ambitions to build their business with a long term mindset have used Alaris to help fund their continuing growth. Alaris provides continuous access to equity capital and a partner that doesn’t have a time horizon. This encourages Business Owners to make long term decisions while providing them with more of the upside that they would achieve under a traditional PE relationship.
Business Owners who want to experience a liquidity event today, but are adamant about keeping the business in the family and maintaining the culture they have successfully built, have used Alaris to accomplish these goals.
Business Owners seeking to monetize a significant portion of the equity built up in their business today but also want to remain in control of their business, continue to dictate time horizon, while being the largest participant in the future growth of their business have used Alaris to facilitate these ambitions.
From signed Letter of Intent to completion of due diligence and closing, expected to be 45-60 days
Alaris invests by way of a preferred share as opposed to the traditional private equity model of common shares and debt. These preferred shares have several attributes that give both economic and “soft issue” benefits to our private company partners:
Entrepreneurs can keep voting control of their companies because Alaris uses non-voting shares. We do not require board representation and do not impose on the operational decisions in a company.
Alaris is one of the only private equity investors in the world that does not include a put right. The decision to sell the business in the future is solely the entrepreneur’s, thus eliminating refinancing risk that exists with both debt and equity alternatives.
Because we do not rely on an exit to generate our returns, the preferred shares are entitled to a regular dividend, just as the entrepreneur’s common shares are. The only difference is that the preferred shares have a different dividend policy. The preferred shares go up and down with the top line results instead of net income so that we don’t have to be involved in the day to day decisions.
Non-control equity is possible when:
Alaris provides cash financing to Partners in exchange for a predetermined distribution, as follows: