Alaris Announces $75.3 Million Investment into a New Partner and a 3% Distribution Increase

Executive Summary

• Alaris Equity Partners completed a $75.3 million investment in Kubik LP, comprising $62.5 M of debt & preferred equity and $12.8 M for minority common equity.
• The investment will generate an annualized cash distribution of $8.1 M to Alaris (initial combined annual yield ~13%) and is tied to Kubik’s revenue performance.
• Alaris’ Board approved a 3% increase in the quarterly distribution to trust unit holders, raising it to $0.38 per quarter ($1.52 annually).

Key Details

• Investment Structure:
• $62.5 M debt & preferred equity component.
• $12.8 M minority common equity purchase.
• Financial Impact on Alaris:
• Expected annual cash distribution from Kubik: $8.1 M.
• Initial combined annual yield to unitholders: ~13%, with annual reset ±8% based on Kubik revenue changes.
• Distribution Increase:
• Quarterly distribution raised by 3% to $0.38 per unit.
• Annual distribution now $1.52 per unit; payout ratio remains below the 65‑70% target.
• Strategic Rationale (CEO/COI comments):
• Alaris aims to support Kubik’s growth through operational value creation and add‑on acquisitions.
• The investment provides flexibility for Kubik to expand service offerings while maintaining high standards of creativity and execution.
• Use of Proceeds:
• Funds used for partial liquidity to existing Kubik shareholders; no further capital deployment disclosed.
• Kubik Overview (non‑material background):
• Founded 1983, Toronto‑based designer/fabricator of custom trade‑show exhibits and immersive environments.
• Serves Fortune 500 clients including Philips, Honeywell, Kia, Nissan, BMW, Lexus; subsidiary Kubik Maltbie focuses on museum installations.

Notable Quotes

• Gregg Delcourt, Chief Investment Officer, Alaris: “We look forward to supporting Kubik’s growth through operational value creation and disciplined add‑on acquisitions…”
• Elliot Kohn, President, Kubik: “This investment gives us the flexibility to expand and accelerate our service offerings for our customers…”
• Steve King, President & CEO, Alaris: “Alaris has announced a $0.04 increase to our annual distribution… The preferred distributions that Alaris will receive from Kubik increase our pro‑forma distributable cash by $0.07 per unit annually.”