Private equity grew company at rate of return of 127%

Yellow Point’s investment in May 2005 generated an internal rate of return of 127% and a multiple of 8.5 times invested capital, when the company was sold to Tricor Pacific Capital in December 2009. David Chapman, Managing Partner of Yellow Point and Terry Holland, a co-investor in CCI and a Yellow Point LP, accepted the deal of the year honour at the CVCA's AGM Dinner in Toronto on Tuesday, September, 2010. Dave said:

“We are pleased with the successful sale of CCI Industries. The sale was truly a win-win for everyone involved. We would like to thank Bruce Clark and Norm Duplessis, co-founders of CCI, for the opportunity to partner with them on this investment. We would also like to thank Terry for his value-add contribution to the CCI board. But most of all, we would like to thank Martin Bates, CCI’s CEO, for his leadership, strategic guidance and stewardship of the business. We brought Martin in to lead the business shortly after our investment in 2005, and he did a phenomenal job growing the business and building value for all stakeholders. We are also pleased that CCI continues to be in very capable hands. Tricor is a class organization and will do great things in taking CCI to its next level of success.”

I agree that Tricor is a good private equity firm. Anna Rossetti is their professional CEO for PCI Cards and she is a firecracker.

About CCI Industries

Headquartered in Edmonton, Alberta, CCI Industries is the world’s largest producer of Allan Block garden, landscape and retaining wall systems and AB Fence products, having sold over 60 million square feet across Western Canada and Washington State. It is also Western Canada’s largest manufacturer of innovative and competitively-priced concrete masonry products having sold over 300 million square feet.

About Yellow Point Equity Partners

Yellow Point Equity Partners is a Vancouver-based private equity investment firm specializing in management buyouts and growth investments for mid-market companies. It invests in and partners with outstanding management teams of later stage private companies with the goal of building shareholder value over the long-term. It aims to be the partner of choice for management teams of Canada’s leading private companies.

Covington Deserves the CVCA Award

Covington Capital Corporation has won this year’s venture capital category award for its investment in SXC Health Solutions Inc., Canada:
“Covington first invested in SXC Health Solutions Inc. in March 2001, and upon exit in July 2010, the investment generated an internal rate of return (IRR) of 38.7% and a multiple of 13.3 times original investment.” The CVCA would also like to congratulate Canadian Medical Discoveries Fund (now GrowthWorks) for their co-investment in SXC Health Solutions Inc.
The honour was accepted by Phil Reddon, Managing Partner, Covington Capital and Jeff Park, CFO of SXC Health Solutions, at the CVCA’s AGM Dinner in Toronto on Tuesday, September 21, 2010.
“Covington’s involvement in SXC ran very deep over a 9 year period as an investor in SXC. Covington has not only been a provider of investment capital, but also a valued strategic partner and active Board member. . Since our investment, SXC has grown from a small Ontario software provider to the Canadian healthcare industry to a solidly positioned, multi-national corporation with estimated 2010 revenues of U.S. $1.9 Billion” stated Mr. Reddon.
“Successes such as these underscore the importance of venture investors in supporting growth and innovation in Canada,” added Phil.

Will Nouriel Roubini's Advice on Payroll Cuts Help?

Nouriel Roubini is giving links to his Wall Street movie cameo - seems awfully vain to me. I saw Paul Krugman on Bring me the Greek last night. What is with these economists...are they are going gaga? Nouriel and Paul may believe they are mainstreaming their subject, and I agree, we all have to move with the social media times, but Tweeting about yourself on the movie too? Come on, Nouriel, you're not Hollywood.
Here is Mish's comments on  Nouriel's latest ideas in Response to Nouriel Roubini on "America Needs a Payroll Tax Cut" Mish also gives a great email from the president of a small corporation adding his comments too. Now this is worth Tweeting, Mr Roubini:

Dear Mish: I agree with your analysis of the statements by Roubini re: payroll taxes. As a business owner with four employees, I’d welcome them; however, such breaks would not entice me to hire another employee. Have a good day.

Here is Mish's response which is exactly right:

I am quite certain that sentiment represents the vast majority of small business owners. The one thing small business owners need is customers. It's hard to get more customers when government is going to start taking a bigger bite out of everyone's pay check. This is further proof that Congress has those bills ass backwards. But hey, who cares if the economy goes to hell. After all, scoring political points is far more important!

Catch more of Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Is the US Turning Japanese?

Is the U.S. sliding into a long-running Japanese-style deflation?
After two decades Japan still struggles to deal with the deflationary effects of the sustained collapse of its real estate and financial markets in the early-1990s. So much so that China recently bumped Japan as the world’s second-largest economy in GDP terms.
To add to these persistent ongoing worries the yen has been showing unwelcome latest strength against the U.S. dollar. As a result, the once-mighty Tokyo Nikkei stock market index has again pulled back steeply and remains mired far below its peak levels of way back then. Prosperity without growth is not a pretty prospect.
Another mounting worry is of America’s ever-growing reliance on foreign debt to finance a federal deficit currently in the order of $1.5 trillion, or 10% of GDP, and counting.
In March, when I last walked past the National Debt Clock in midtown Manhattan, some one-third of the $12 trillion-plus U.S. Treasury debt (equivalent to almost 80% of GDP) was owned by China ($900 billion), Japan ($800 billion) and other foreign creditors. These holdings might well have been reduced since then. And what if this were the beginning of enough being enough? When do troublesome trends like these stop, and how should they be reversed?

The US and UK Approach to the Economy - which is right?

Worries of a “double dip” recession are not to be taken lightly. And neither the risks associated with unprecedented levels of debt sparked by lifesaving, over-the-top government stimulus and deficits and debts of all types (including household and consumer) that could well have reached dangerous tipping points.
Whereas two years ago the worries centred around the bail-out of banks, financial institutions and enterprises judged too big to be allowed to fail (e.g. “Government Motors”), this year’s focus shifted to the public sector as sovereign debt risk (epitomized by Greece, maybe also Ireland) came to occupy centre stage. And, with it, how the G8 and OECD nations, in other words the developed world, tackle disorders that could have reached explosive proportions.
The dichotomy between the fiscal approaches being taken by the governments of the U.K. and the U.S. couldn’t be greater, the one resolving to tackle its formidable deficit and debt problems head on, the other to keep the spigots open in order not to risk jeopardizing a fragile economic recovery.
Symbolically, David Cameron, the youthful new British Prime Minister, flew commercially on trips to Toronto for the G8/G20 meetings, and to New York to address the UN. From New York he took the train to Washington to meet President Obama. In between, his “accidental” coalition government (The Economist) brought down the harshest kill-or-cure budget in generations. Its aim – to eliminate a record deficit within five years through a combination of severe fiscal tightening (public service cutbacks and pay freezes, et al), higher consumer taxes (e.g. VAT to be raised to 20% from 17.5%), levies on banks, an increased capital gains tax and other private sector measures.
“When we say that we are all in this together, we mean it”, said George Osborne, Britain’s youngest-ever Chancellor of the Exchequer. Echoes of the Thatcher years are unmistakable. Times and circumstances may be different today, but a British “disease” of a different type could be taking hold as a wave of austerity begins rolling across a debt and deficit-heavy Europe. (Mr. Cameron and EU leaders might also like to note how Stephen Harper of Canada has managed to govern effectively for four difficult years with a minority government.)