Crown Capital Partners closes down NCOF II with 24% IRR

With the recent repayment of special situations loan to CRH Medical Corporation, Crown Capital Partners Inc. (TSX: CRWN) has formally closed down Norrep Credit Opportunities Fund II, LP and Norrep Credit Opportunities Fund II (Parallel), LP

Crown Capital was the manager of NCOF II and held a 53.6% interest in aggregate.

NCOF II was established in 2012, closed its first loan in December 2012 and invested approximately $81.5 million in five companies: Genalta Power Inc., Claude Resources Inc., Questrade Inc., CRH Medical Corporation, and Corrosion Service Company. NCOF II generated a gross IRR of approximately 24% and a multiple of approximately 1.5X.

“The loans in this portfolio performed well for our investors, adding to Crown’s outstanding 17-year track record in mid-market lending,” said Chris Johnson, President and CEO of Crown. “There is a significant unmet need for customized financing solutions aimed at the mid-market, and we are building on our track record to expand Crown’s presence and asset base, both directly and through our fund management business.”

The completion of NCOF II has triggered payment of $4.3 million of performance fees to Crown, as manager of NCOF II. Prior to the closing of its initial public offering (IPO), Crown committed to pay 100% of the performance fee distributions accrued to June 30, 2015 to the Pre-IPO plan participants. In addition, Crown’s current compensation policy provides that 50% of such performance fee distributions earned will be distributed to the employees. As such, Crown has retained approximately $1.0 million of the performance fees.

Crown’s current special situations fund, Crown Capital Fund IV, LP, has deployed approximately $170 million of the targeted $300 million.

photo credit: Crown Capital Partners

Ted Liu

Ted Liu, M.Sc. (Mining), MBA (Finance), is the Editor of Private Capital Journal and CanadaMetals.ca, and former Editor of Canadian Private Equity. Ted has been passionately tracking Canadian private capital industry since 1992, most recently served as Research Director for The Canadian Venture Capital and Private Equity Association (CVCA). Ted was the architect of CVCA infobase, and is the architect of CPE Media's Financings.ca, the most sophisticated and advanced all private capital and public market financing database.