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Investment Criteria

 

Canal's investment approach has been built on the belief that the quality of the principal's character is as important as the quality of the company's  cash flow. 

 

Opportunities of interest to Canal will meet the following profile:

  • Financially committed management team

  • Strong free cash flow

  • Revenue visibility

  • Distinctive product, service or brand

  • Sustainable competitive advantages

  • Attractive industry fundamentals

  • Potential for operation's improvement

  • Identified growth potential

  • Revenue range of $5-$50 million

  • EBITDA range of $1-$5 million

 

Canal is a long-term, patient financial partner for businesses seeking to finance:

  • Acquisitions

  • Ownership transitions, including private equity buyout, management buyout, or minority buyout

  • Strategic add-on acquisitions

  • Organic growth initiatives

  • Recapitalizations

 

Canal will consider investments in the following types of businesses:

  • Business services

  • Industrial services

  • Healthcare services

  • Value-added distribution

  • Basic manufacturing

  • Consumer products

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Investment Structure

 

Canal creates flexible, customized investment structures to provide its portfolio companies with a solid financial base to assist in achieving the collective goals with our management team partners.

 

Canal will invest between $2 million to $7 million in each portfolio company and has access to capital funding amounts for larger opportunities through co-investments from our institutional limited partners.

 

Investments always lead with subordinated debt and include a modest equity share to align the interests of the investors. 

 

Generally, Canal will structure its investments with five-year maturities or investment horizons, and with subordinated debt and preferred equity securities, a current coupon or dividend will also be included.

 

Equity participation, typically warrants or other features, is a critical aspect of every investment and ensures a proper alignment of interests with all other stakeholders.

 

 

"I cannot personally thank Canal enough for their professionalism, support, energy and perseverance through this process. We look forward to capitalizing on the opportunities Canal's partnership will provide."

Joe Pucci, CEO of American Heritage Billiards

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