Editor’s Note: It was mistakenly reported that the Canadian Business Growth Fund made its first-ever investment to Lift Auto Group on Oct. 1, 2019. The investment was actually issued on Oct. 1, 2018. Collision Repair apologizes for the error.
Lift Gets Lifted
A recently-established Canadian financial group that seeks to offer funds to mid-sized Canadian businesses has given a $15 million investment to Lift Auto Group.
The Canadian Business Growth Fund, established in 2018, handed out its first-ever investment the week of Oct. 1, 2018. The $15 million investment went to Kelowna, British Columbia-based collision repair company Lift Auto Group, which has six shops across British Columbia and Alberta and a plan to expand its footprint across Western Canada in the coming years.
CBGF’s investment has already helped the company close a significant acquisition in Edmonton, Alta, according to the fund.
“Lift is a great fit with our mandate and we are excited to partner with them as they put their growth strategy into action,” said George Rossolatos, CEO of the fund. “They have an ambitious team, solid plans for scaling up and experience to execute on their vision to build a leading collision repair company. They are thinking big, and with this round of investment, they have the capital required to become a leading player in a highly fragmented industry.”
The fund has a total of $545 million to invest in growing mid-sized Canadian companies. It seeks to make investments between $3 million and $20 million to companies with $5 million or more in annual revenue, a demonstrated growth trajectory and a clear vision for accelerated growth.
Founded in June 2018, the Canadian Business Growth fund is a coalition of nine banks (CIBC, RBC, BMO, TD, Scotiabank, Laurentian, HSBC, National and Canadian Western), three insurance companies (SunLife, Great-West Life and Manulife) and the Alberta Treasury Branches, also known as ATB Financial.
Big Boss Boyd
According to a recent report, the Boyd Group Income Fund now controls four percent of the collision repair industry.
The Winnipeg, Manitoba-based Boyd Group Income Fund’s acquisition strategy has led to years of rapid growth for the company. The strategy involves continuously looking and adding new collision repair facilities to the company’s existing networks in Canada and the United States. With shares increasing more than 14,000 percent since 2006, a $10,000 investment in 2006 would be equal to $1.4 million today.
Boyd’s market cap is $3.5 billion, while the Canadian industry at large is worth around $50 billion. With 80 percent of the industry consisting of small business owners is local communities, Boyd has room for additional growth via further acquisitions.
Boyd stock has never had a losing year stocks-wise in its entire operating history. However, after reaching a high of 181.04 in mid-September, its stocks have been steadily dropping since. The company suffered a new low of 171.64 on Oct. 8 and is currently trading for 175.2.
The trend could also mark growing pains for the group as it transitions in a new CEO. Tim O’Day is currently gearing up to replace Brock Bulbuck by 2020, with a succession plan currently in place.
GM’s Longing Letter
General Motors shares saw a slight increase after the automaker’s American division sent a letter to its striking employees last Friday.
As the GM and UAW strike dragged into its 26th day on Friday, the automaker released a letter to its striking employees, encouraging them and the UAW to settle. The letter appeared to spawn a small spike in the company’s shares, with a 1.6 percent increase in premarket action on Friday.
Investors are hoping for a breakthrough between the two parties, as the strike is also costing them. At this point, investor losses are predicted to be in the billions.
On Sept. 13, GM shares closed at 38.86. When the strike began on Sept. 16, shares dropped to 37.21. As of Oct. 10, shares were listed at 34.66.
GM shares have dropped almost 11 percent since the strike began — worse than the 2.6 percent decline of the Dow Jones Industrial Average over the same timespan.
