Private Equity Takes Wheel of H2O Innovation

13 Oct 2023
Quick Read / 2 pages
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On 2 October 2023, Ember Infrastructure Management LP announced its intention to acquire H2O Innovation Inc., a Canadian water solutions provider. H2O reported revenues of CAD$253 million (US$186 million) for fiscal year 2023. Currently listed on the Toronto Stock Exchange, the acquiring consortium plans to delist H2O and make it a private company.

The deal offers a 68% premium on the share price as of 2 October 2023. Based on an EBITDA multiple of 18.5X, the company’s valuation would be approximately CAD$370 million (US$276 million). After the acquisition completion, Ember will become the majority shareholder of H2O alongside Investissement Québec (IQ) and Caisse de depot et placement du Québec (CDPQ). Key executives will collectively hold a 21% equity stake in the firm.

In this Research Note:

  • Take-private deal highlights challenges of scaling O&M business
  • H2O pursues alternative growth path compared to O&M rivals
  • Financial investors eye growth in utility operations

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