Alaris completes $115.5M investment into Optimus

Executive Summary

• Alaris Equity Partners Income Trust has completed a $115.5 million investment in Optimus SBR Inc. and Optimus SBR Limited Partnership, Canada's largest independent management consulting firm.
• The transaction involves $85.0 million in preferred equity and $30.5 million in common equity, providing Alaris with a 13% pretax annualized yield on the preferred portion.
• Proceeds from the investment are designated for partial liquidity to existing equity holders of Optimus SBR.

Key Details

• Total Investment Amount: $115.5 million.
• Investment Structure:
  • Preferred Equity: $85.0 million.
  • Common Equity: $30.5 million.
• Yield and Distributions:
  • The preferred equity provides an initial annualized distribution of $11.1 million.
  • This translates to a pretax annualized yield of 13%.
  • Distribution adjustments occur annually based on the percentage change in Optimus SBR's annual revenue, subject to a collar of plus or minus 8%.
• Financial Metrics:
  • Optimus SBR maintains an earnings coverage ratio between 1.2x and 1.5x based on trailing 12-month financial results.
• Use of Proceeds: Partial liquidity for equity holders of Optimus SBR.
• Strategic Context:
  • This is Alaris's first new Canadian partner in over six years.
  • Alaris has deployed approximately $343.5 million in capital year-to-date following this closing.
  • Optimus SBR specializes in strategy, process management, AI, digital transformation, and technology consulting across financial services, government, and healthcare sectors.

Notable Quotes

• Kevin Gauci, CEO and Co-founder of Optimus SBR: "Alaris's commitment to empowering founders to continue their growth journey aligns perfectly with our own vision and values. This investment provides us the flexibility to unlock our full potential and accelerate our growth as we help clients navigate the complex challenges of AI, digital transformation and evolving regulatory environments."
• Steve King, President and CEO of Alaris: "As the largest independent management consulting company in Canada, this asset was highly sought-after by private equity firms across North America. Since its founding, Optimus has become an essential and sought-after adviser to the Canadian banking industry... we look forward to supporting the company's growth in the years to come."