Quebec invests $30 million in a new private fund

Investissement Québec (IQ) will contribute $30 million to the creation of a brand new private investment fund in Montreal, specializing in the aerospace industry.

Quebec invests $30 million in a new private fund

Investissement Québec (IQ) will contribute $30 million to the creation of a brand new private investment fund in Montreal, specializing in the aerospace industry.

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With an initial budget of $77 million, Thrust Capital Partners has set itself the goal of quickly reaching capitalization of $100 million.

Fonds FTQ and Desjardins involved

Sums that will be used to acquire stakes in companies in the sector, chosen for their potential for accelerated growth.

IQ's $30 million comes from the $300 million envelope announced in the fall of 2020 for the creation of new independent investment funds.

Alongside the Quebec government, the Fonds de solidarité FTQ is investing $20 million in the adventure. Desjardins Group is committed to investing “at least $12.5 million” in Thrust Capital.

Its president, Frédéric Loiselle, long associated with the BDC and the defunct Société Générale de Financement (SGF), believes that the moment could not be better chosen to launch such a fund and take advantage of the rebound that the industry has been hoping for for more than two years.

Create OEMs

The new entity presents itself as a solution to the recurring growth problems that have plagued the aeronautical ecosystem in Quebec for years. Rich in SMEs, Quebec has failed – with some exceptions – to create companies large enough to meet the expectations of major contractors such as Boeing, Lockheed Martin and Airbus.

Héroux-Devtek, in Longueuil, a company that has become an equipment supplier of sufficient size to meet the needs of the U.S. Air Force, is presented as an example of what other SMEs in the sector in Quebec could become.

The fund team does not hide the fact that it favors the acquisition of majority stakes in companies. Once its growth potential has been reached, the company would either be merged, sold or listed on the stock exchange, allowing the fund to recover its marbles and reap profits.

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