Former Onex Corporation managing director Andrew Sheiner has recruited a team of investment professionals for his new Toronto-based private equity firm Altas Partners, which he launched last month.
Altas will employ a different fee structure than typical private equity funds, but Sheiner did not comment on the specifics other than to say the fee structure would “align the interests of the management team with the long-term investing objectives of the underlying owners”.
Altas has yet to launch a fundraising process, but Sheiner did say that fundraising would likely take place over the course of the next six months. He did not specify the size of the fund.
“We’re in the early discussion phase with a handful of large institutional investors and large families,” he said.
The name Altas comes from Alternative Long Term Assets.
Sheiner has hired a total of five individuals, including principal Chris McElhone, a former Onex executive who left in 2009 to become director of business development at Husky Injection Molding Systems, one of Onex’s portfolio companies. At Husky, McElhone led the transformation of the business' global cost structure.
“[McElhone]’s job as a principal at Altas will really be to help assess the cost improvement potential of the companies that we acquire and to interface with the portfolio companies after we buy them around executing on those plans,” Sheiner told Private Equity International.
Also joining Altas as chief operating officer and managing partner is vice chair at Deloitte Andrew Dunn, who leads the tax firm’s involvement with Canadian-based private equity funds. Altas’ five new investment professionals will officially join in September and October, at which point the firm will begin to focus on finding investment opportunities.
Altas’ strategy will differ from other private equity firms by investing in companies with “more stable cash flow characteristics” and by holding them for longer than the typical five years, according to Sheiner. The firm will target North American mid-market businesses without focusing on a particular sector.
“We’re looking for high quality operating businesses that one might contemplate owning for a longer period than is usual for traditional opportunistic private equity…which means holding businesses for 15 years if it makes sense,” he said.
While Altas’s target companies will in some ways have “infrastructure-like dynamics”, Sheiner said, they will not necessary be regulated utilities.
“The real way to think about this is that white space that exists between infrastructure investing and opportunistic private equity,” he said.