Clairvest Invests in Beneficial Reuse Management

Clairvest Group Inc. has recapitalized and invested in Beneficial Reuse Management (BRM), a company focused on converting industrial waste streams into value-added products for agriculture, landscaping, and construction, marking Clairvest's 10th partnership in the environmental services sector. The investment, made with Clairvest Equity Partners VII, aims to support BRM's growth plans to become a leading beneficial reuse and industrial recycling company in the U.S. BRM operates six processing facilities and a distribution network of over 116 locations, providing waste disposal and recycling solutions for industrial waste generators.

Analysis

Clairvest Group Inc. (TSX: CVG), in conjunction with Clairvest Equity Partners VII (CEP VII), has executed a recapitalization and investment in Beneficial Reuse Management (BRM), a Chicago-based company specializing in converting industrial waste into value-added products for sectors including agriculture, landscape, and construction. This transaction, Clairvest's 10th in the environmental services industry where it has been active for over 19 years, underscores its strategic focus on this sector. BRM, founded in 1999, operates six processing facilities and a distribution network of over 116 locations, aiming to meet growing demand for specialty agricultural nutrients and recycled wallboard while offering innovative waste disposal solutions. The investment is the third for CEP VII, a US$1.2 billion fund to which CVG contributes US$300 million, and marks Clairvest's 69th platform investment. Clairvest, managing CAD $4.6 billion, intends to support BRM's aggressive growth strategy to become a leading U.S. beneficial reuse and industrial recycling entity, leveraging its industry expertise. The deal, advised by Raymond James for BRM, is perceived positively, with a sentiment score of 0.3 for the event and 0.4 specifically for CVG, aligning with themes of M&A, ESG, company fundamentals, private markets, and green finance. This move solidifies Clairvest's commitment to partnering with entrepreneur-led businesses for strategic growth, particularly in environmentally significant industries.

Key Decisions for Investors

• Investors should view CVG's investment in BRM as a strategic enhancement to its portfolio, reinforcing its exposure to the high-growth environmental services sector which benefits from strong ESG tailwinds.
• Consider that the financial impact on CVG will be realized over the long term, typical of private equity investments, and monitor the performance of Clairvest Equity Partners VII as a key indicator of successful capital deployment and value creation from this and other new investments.
• Recognize this transaction as consistent with Clairvest's established strategy of investing in owner-led businesses with significant growth potential, and a positive signal of its ongoing capital deployment within its target industries.