Mosaic Capital acquires control of Cedar Infrastructure Products for $18.3M

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By Ted Liu

Mosaic Capital Corporation (TSX-V: M, M.DB) has completed the acquisition of a 75% interest in the business being carried on by Cedar Infrastructure Products Inc. from its founders, Matthew Genovese and Tony Maio, who retained the remaining 25%.

Mosaic’s cost of the acquisition was $18.3 million, funded through a combination of cash ($14.0 million) and vendor take-back financing ($4.3 million).

The vendor take back financing is payable in full on year three and bears interest at commercial rates. Existing management will remain in place and the transaction includes a three-year earn out provision to be paid to the vendors if the business meets specified financial targets.

Established in 2000, Vaughan, Ontario based Cedar Infrastructure Products is a distributor of municipal iron castings, concrete pipe, pre-cast products and related specialty items to service the road, water and sewer infrastructure and residential construction industries. Cedar serves a broad group of contractors and municipalities in the Greater Toronto Area and Southwestern Ontario regions.

“Following our acquisition of Bassi in December of 2016, this acquisition represents Mosaic’s second acquisition in the Ontario market and is consistent with our long-term strategy to add both industry and geographic diversification to our portfolio. This transaction is another example of Mosaic acquiring established and resilient businesses with strong organic growth opportunities that are operated by successful owners and management teams,” said Mark Gardhouse, CEO of Mosaic Capital.

photo credit: Cedar Infrastructure Products