Mosaic Capital Corporation (TSX-V: M and M.DB) has acquired a 75% interest in the business being carried on by Circle 5 Tool & Mold Inc. for $27 million. The remaining 25% of Circle 5 is being retained by its President and primary operating shareholder, Saylo Lam.
Mosaic Capital funded the acquisition with $7 million from available credit facilities and $20 million from the issuance of three year, 7% subordinated preferred units within a newly formed limited partnership, which is 100% controlled by Mosaic.
Techumseh, Ontario based Circle 5 is a supplier of molding solutions to Tier 1 automotive part manufacturers, offering custom, high-precision molds and tools for plastic injection production of highly-visible interior automotive components.
Circle 5’s broad international customer base produces interior components for today’s leading automotive brands including BMW, Ford, Volkswagen, General Motors, Toyota, Daimler and Tesla. With an established track record of over 30 years, Circle 5 is highly regarded in the industry for its delivery of quality molds and tools based on strong customer responsiveness, innovation and collaboration.
Saylo Lam, President of Circle 5 stated “Mosaic’s involvement successfully solved a key ownership succession issue, which results in an orderly transition of Circle 5’s two founding shareholders, one of whom is my father. We are excited to move forward with the Mosaic team, as we collectively pursue a number of identified organic and acquisition growth opportunities.”
Mark Gardhouse, CEO of Mosaic Capital commented “we are delighted to welcome Saylo Lam and his management team at Circle 5 as Mosaic’s newest operating partner and we look forward to a long-term relationship. Circle 5 has an established track record of strong financial growth and profitability within a niche market that has an attractive outlook. This acquisition illustrates the diversified growth model we are implementing and offers a new business platform for future growth opportunities.”
Mosaic Capital is a Canadian investment company that owns a portfolio of established businesses which span a diverse range of industries and geographies. Mosaic Capital is backed by Fairfax Financial Holdings Limited (TSX: FFH, FFH.U) which invested $150 million in Mosaic Capital in January 2017.
photo credit: Circle 5