LONG-TERM INVESTOR ALTAS PARTNERS CLOSES FUND II AT $3 BLN HARD CAP

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• Fund II is triple the size of its 2016 predecessor
• More than 50 LPs signed on, a source said
• Altas Partners was an early adopter of long-term investing

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Altas Partners, a pioneer of long-life investing, has wrapped up its second fund at a hard cap of $3 billion, Buyouts has learned.

Altas Partners Holdings II is triple the size of its predecessor, which secured $1 billion in 2016. Prior to Fund I, the Toronto-based private equity firm invested deal-by-deal by partnering with select investors.

Fund II was backed by more than 50 limited partners, a person with knowledge of the matter told Buyouts. New and returning investors included endowments and foundations, family offices and pension plans, the source said.

Individual investors in Fund II included Louisiana State Employees’ Retirement System, which committed $100 million; San Mateo County Employees’ Retirement Association, which committed $10 million; and School Employees’ Retirement System of Ohio, which committed $50 million.

Altas declined to comment on the details of its fundraising activity.

Altas was founded in 2012 by Andrew Sheiner, a former senior Onex Corp executive, to make control investments in hard-to-replicate businesses. Unlike other PE investors, which typically hold portfolio assets for three-to-five years, the firm invests with an indefinite horizon, focusing on owning assets long enough to generate maximum value.

Altas picks only one or two companies for acquisition per year, investing $250 million to $1 billion or more in each. This deliberative deal pace is reflected in the sourcing process, which averages 11 months from initial engagement to completion.

Fund II will continue this strategy, Sheiner told Buyouts in an interview.

Altas was an early adopter of long-life investing, a trend that has grown in popularity in the PE industry. A survey published this month by Dechert found 51 percent of general partners are exploring a long-hold fund, up from 32 percent last year, while 27 percent have already established a vehicle.

Sheiner said Altas will continue to differentiate itself in a potentially growing field. “Our model is to be a singularly-focused investor and owner, with one team and one strategy,” he said. “This allows us to be discerning and enjoy the flexibility to own each business for five years or 15 years, whatever is appropriate.”

Altas has made eight investments since inception. Its most recent is DuBois Chemicals, a Cincinnati-based specialty chemical solutions provider acquired in September from Jordan Company.

Altas also this year sold two portfolio companies, among them MyEyeDr, a Vienna, Virginia-based vision care practices network. It was acquired by Goldman Sachs in August, generating a return of about 3.5x, Buyouts reported.

In addition, Altas in January sold NSC Minerals, a Saskatoon, Saskatchewan-based salt products maker. The buyer was Kissner Group, which is backed by Metalmark Capital and other investors.

Altas has been adding to its investment team of late. Recent hires include Partner David Brent, who joined in 2018 from Apollo Global Management. The firm also this year appointed Kathleen Taylor, the former CEO of Four Seasons Hotels and Resorts, to the new position of chair.

Other senior team members include Managing Partner Scott Werry and Partners Christopher McElhone, Paul Nicoletti and Damon Conway.

Fund II’s close brings total commitments managed by Altas to about $7 billion.

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KIRK FALCONER, PE HUB; BUYOUTS

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Andrew Sheiner’s firm generally makes two investments a year, which it can hold for as long as 15 years

Altas Partners, a firm founded on the idea that some private-equity investments can benefit from having more time to ripen, has amassed $3 billion for its second fund.

The vehicle, Altas Partners Holdings II LP, was oversubscribed and closed at its hard cap, the Toronto-based firm said Monday. The new fund was raised with the help of Park Hill Group, according to a Securities and Exchange Commission filing.

At $3 billion, Altas’s new fund is triple the size of its maiden offering, which closed at $1 billion in 2016.

Altas, which was founded in 2012 by former Onex Corp. executive Andrew Sheiner, is one of the pioneers of longer-term private-equity investing. The firm can hold companies it buys for as little as five years, which is standard for private-equity investments, or as long as 15 years, which is beyond the 10-to-12-year maximum hold time typical for private-equity managers.

The firm’s second vehicle will continue the strategy of the first fund, said Mr. Sheiner, who is the firm’s managing partner as well as founder. Altas generally makes two investments a year, targeting deals worth $250 million to $1 billion in equity in sectors including industrials, health-care and education. The debut fund made five investments.

Longer-term investing has become more common over the past decade, as firms and investors have come to see benefits in having the option of a longer hold period. Longer-term funds also typically charge lower management fees than traditional buyout vehicles.

Firms that have launched longer-term funds in recent years include Vista Equity Partners, CVC Capital Partners, KKR & Co. Inc. and Blackstone Group Inc. So far this year, 15 longer-term funds have closed on a total of $5.3 billion, according to data provider Preqin Ltd.

Altas’s latest fund has already made its first investment, backing specialty chemical supplier DuBois Chemicals Inc. in a deal signed over the past summer. Earlier this year it closed on the $400 million purchase of the University of St. Augustine for Health Sciences, an educator of physical and occupational therapists with campuses in California, Texas and Florida.

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LAURA COOPER AND CHRIS CUMMING, THE WALL STREET JOURNAL

Altas Partners (“Altas”), a long-term oriented investment firm, announced today the final closing of its second fund, Altas Partners Holdings II LP (“the Fund”), with US$3 billion of limited partner capital commitments. The Fund closed at its hard cap and was oversubscribed.

“We are grateful for the enthusiastic response to the Fund,” said Andrew Sheiner, Founder and Managing Partner of Altas, “and we remain singularly focused on creating lasting value for our investors as an engaged owner of high-quality businesses.”

Altas differentiates itself through a distinctive approach to investing, building its portfolio slowly and carefully over time and enjoying a flexible time horizon as an owner. With the Fund, Altas will continue to execute the firm’s strategy of investing in one or two high-quality, market-leading businesses each year.

“We are fortunate to enjoy the support of a wonderful group of global partners,” added Katie Taylor, Chair of Altas. “We look forward to building upon our strong foundation in the years ahead, and to enhancing our reputation as a partner of choice for management teams.”

About Altas Partners
Founded in 2012, Altas Partners is an investment firm with a long-term orientation focused on acquiring significant interests in high-quality, market-leading businesses in partnership with outstanding management teams. The firm manages approximately US$7 billion on behalf of endowments, foundations, family offices, public pension funds, and other institutional investors. The firm’s past and present portfolio companies include DuBois Chemicals, University of St. Augustine for Health Sciences, Tecta America, Hub International, PADI, Medforth Global Healthcare Education, Capital Vision Services (MyEyeDr.), and NSC Minerals. For more information, please visit www.altas.com.

Altas Partners has completed its previously announced acquisition of DuBois Chemicals Inc. (“DuBois”), a premier provider of customized and value-added specialty chemicals solutions and services to more than 15,000 customers.

Founded in 1920, DuBois researches, develops, manufactures, and supports a broad range of customized specialty chemical products and related equipment. DuBois is a solutions provider to its customers, helping them address their significant performance, quality, cost, safety, and compliance issues and challenges.

Headquartered in Cincinnati, Ohio, DuBois leverages its proprietary chemistries and unique on-site service and support capabilities to offer a compelling value proposition by reducing downtime, minimizing defects, and extending equipment life for its customers’ applications. As a result, DuBois maintains strong loyalty across a diverse customer base that relies on its technical expertise and broad suite of product solutions to ensure their machinery, processes, and systems run seamlessly.

For more information, please visit www.duboischemicals.com.

Altas Partners today announced that it has completed the sale of Capital Vision Services, LP (“CVS”), a leading provider of management services to vision care practices. CVS provides its affiliated, independent MyEyeDr. optometrists with a complete array of financial, marketing, human resources, and accounting services, along with managed care credentialing and claims processing.

CVS was sold to West Street Capital Partners VII, a fund managed by the Merchant Banking Division of Goldman Sachs. Financial terms of the transaction were not disclosed.

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ABOUT ALTAS PARTNERS

Founded in 2012, Altas Partners is an investment firm with a long-term orientation focused on acquiring significant interests in high-quality, market-leading businesses in partnership with outstanding management teams. The firm manages more than $6 billion on behalf of endowments, foundations, public pension funds, and other institutional investors. The firm’s past and present portfolio companies include University of St. Augustine for Health Sciences, Tecta America, Hub International, PADI, Medforth Global Healthcare Education, Capital Vision Services, and NSC Minerals. For more information, please visit https://www.altas.com.

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FOR FURTHER INFORMATION:

Aisha Sánchez
+1 (416) 306-9800
asanchez@altas.com

Altas Partners (“Altas”), a long-term oriented investment firm, today announced it has signed a definitive agreement to acquire DuBois Chemicals, Inc. (“DuBois” or the “Company”), a leading specialty chemical supplier, from The Jordan Company, L.P. (“TJC”). Financial terms of the transaction were not disclosed.

DuBois is a premier provider of customized and value-added specialty chemicals solutions and services to a global customer base. The Company combines local high-touch technical service, leading R&D capabilities, customized equipment solutions, and deep knowledge of manufacturing processes to deliver reliable, mission-critical, and innovative products to more than 15,000 customers globally across a spectrum of industries and end markets. DuBois’ full suite of solutions and services brings leading, reliable technologies that reduce chemical, water, labour, and energy costs for customers and support their operations to improve quality and efficiency.

“We chose to partner with Altas because their team shares our conviction and excitement regarding the long-term opportunity for DuBois, making the firm an ideal partner as we enter our next phase of growth,” said Jeff Welsh, President and CEO of DuBois. “With Altas’ support, we look forward to continuing the development of the business through both organic growth and continued selective acquisitions. We greatly appreciate the support we’ve received from The Jordan Company, and we thank them for their guidance and partnership.”

“Over its 99-year history, Dubois has built its position as a leading international provider of specialty chemical solutions, through a focus on innovation, quality production, and customer service,” said David Brent, a Partner at Altas. “For Altas, this investment is the culmination of a multi-year effort to identify a world-class platform and team that we can partner with in the specialty chemicals industry. We look forward to supporting Jeff and the DuBois team as they continue to build on the company’s success and leadership in the coming years.”

“We are proud of the growth that DuBois has achieved during our ownership period. DuBois’ tremendous advancements are a testament to Jeff’s strong leadership and the company’s outstanding management team. We expect Altas will be a great next partner for DuBois and look forward to watching the company’s continued success,” said Ian Arons, a Partner at TJC.

The transaction is expected to close in the second half of 2019, subject to customary closing conditions and regulatory approvals.

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ABOUT ALTAS PARTNERS

Founded in 2012, Altas Partners is an investment firm with a long-term orientation focused on acquiring significant interests in high-quality, market-leading businesses in partnership with outstanding management teams. The firm manages more than $6 billion on behalf of endowments, foundations, public pension funds, and other institutional investors. The firm’s past and present portfolio companies include University of St. Augustine for Health Sciences, Tecta America, Hub International, PADI, Medforth Global Healthcare Education, Capital Vision Services, and NSC Minerals. For more information, please visit https://www.altas.com

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ABOUT DUBOIS CHEMICALS

Founded in 1920, DuBois is a market-leading full-service provider of customized specialty chemical solutions. The company researches, develops, manufacturers, and supports a broad range of customized specialty chemical products and related equipment to provide solutions to customers’ most challenging performance, quality, cost, safety, and compliance issues for a variety of industries. Headquartered in Cincinnati, Ohio, the company leverages its proprietary chemistries and unique on-site service and support to offer a compelling value proposition by reducing downtime, minimizing defects, and extending equipment life for its customers’ most-critical applications. As a result, DuBois maintains strong loyalty across a diverse customer base that relies on its technical expertise and broad suite of product solutions to ensure their machinery, processes, and systems run seamlessly. For more information, please visit www.duboischemicals.com.

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ABOUT THE JORDAN COMPANY

The Jordan Company, founded in 1982, is a middle-market private equity firm that has managed funds with original capital commitments in excess of $11 billion since 1987 and a 37-year track record of investing in and contributing to the growth of many businesses across a wide range of industries including Business Services, Consumer & Healthcare, Financial Services, Industrials & Distribution, Telecom, Technology & Utility and Transportation & Logistics. The senior investment team has been investing together for over 20 years and is supported by the Operations Management Group, which was established in 1988 to initiate and support operational improvements in portfolio companies. Headquartered in New York, TJC also has an office in Chicago. For more information, please visit www.thejordancompany.com.

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Deal comes as investor approaches close of second flagship fund

Long-term investor Altas Partners has agreed to acquire specialty chemical supplier DuBois Chemicals Inc. from owner Jordan Co., according to people familiar with the deal.

The deal with Altas would mark an exit for Jordan Co., which bought the company in 2017. Since then, it has grown through acquisitions, including the purchase of BHS Specialty Chemical Products, a manufacturer and distributor of chemicals, and at least four deals in recent years.

The terms of the deal couldn’t be learned.

DuBois, based in Sharonville, Ohio, provides industrial chemicals for water treatment, aerospace uses, auto wash and detailing, manufacturing and transportation. It serves more than 15,000 customers globally.

The investment comes as Altas nears the final close of its second long-term investment vehicle, which has a $3 billion hard cap, according to one of the people. Altas raised $1 billion for its previous fund, which it closed in 2016, saying at the time it could hold portfolio companies as long as 17 years.

The Toronto-based private-equity firm typically aims to hold companies longer than the standard period of roughly five years. Altas generally makes one or two new deals a year.

Earlier this year, it closed on a $400 million purchase of the University of St. Augustine for Health Sciences, an educator of physical therapists and occupational therapists with campuses in California, Texas and Florida.

Altas also had a large exit earlier this year when it agreed to sell Capital Vision Services LP—which manages MyEyeDr. Optometry practices—to the merchant banking division of Goldman Sachs Group Inc. The deal was valued at $2.7 billion, including debt, according to a Wall Street Journal report. Altas had invested in the company alongside Canadian pension fund Caisse de dépôt et placement du Québec.

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LAURA COOPER, THE WALL STREET JOURNAL

Andrew Sheiner explores the current state of the private equity industry, the mix of economic factors that could trigger a downturn, and the precautions managers need to take as we get closer to the end of the cycle.

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Kathleen Taylor, the former CEO of Four Seasons Hotels and Resorts, took on the role this month, Managing Partner Andrew Sheiner told Buyouts.

As part of the job, Taylor will provide advice and support to companies in the portfolio, Sheiner said, drawing on her more than three decades of experience as a senior executive.

“We expect Katie will be an excellent resource, sounding board and thought partner for our CEOs as they manage and grow their businesses,” he said.

The appointment builds on Taylor’s prior four years as a member of Altas’ advisory board, a role that enabled her first contributions to the portfolio.

In 2016, Taylor became a key adviser to Sue Downes, co-founder and CEO of MyEyeDr, a U.S. network of optometry and eye-care practices. Managed by Capital Vision Services, the business was acquired a year earlier by a group led by Altas and Caisse de dépôt et placement du Québec.

Deepening her involvement in 2017 by joining MyEyeDr’s board, Taylor supported Downes and the management team on a range of issues and initiatives, including long-term strategy, organizational effectiveness and talent acquisition.

This month, Goldman Sachs agreed to acquire MyEyeDr, reportedly for US$2.7 billion. The deal is expected to generate a return of about 3.5 x for Altas, Buyouts reported.

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Trailblazer

Joining Altas’ team is the latest milestone in Taylor’s career, which includes a record of blazing trails for women in the corporate world.

Starting out as a lawyer, Taylor was hired in 1989 by Four Seasons and over a 24-year tenure rose in the luxury hotel chain’s management ranks. In 2007, she became president and COO, and in 2010, CEO, making her one of only a few Canadian female executives to hold the top C-suite job, then and today.

Taylor broke another glass ceiling in 2014 with her appointment as chair of Royal Bank of Canada. She was the first woman to lead the board of a major bank in Canada and one of a handful to do so globally.

Taylor also serves as vice-chair of Adecco Group and as a director of Air Canada and Canada Pension Plan Investment Board.

Sheiner, a former senior Onex Corp executive, founded Altas in 2012. An early adopter of the long-life philosophy in private equity, the Toronto firm focuses on buying hard-to-replicate companies and holding them indefinitely.

Taylor told Buyouts Altas’ strategy “resonates with me very much,” noting she has “come to appreciate first-hand” the firm’s appeal to owner-operators “seeking a thoughtful and long-term oriented partner.”

Other senior members of Altas’ team include Managing Partner Scott Werry and Partners Christopher McElhone, Paul Nicoletti, David Brent and Damon Conway.

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KIRK FALCONER, PE HUB; BUYOUTS