Roynat eyes ‘succession-related’ deals

The Canadian firm has purchased aviation technology company SkyTrac from its founder - a formula it plans to replicate, says managing director Elmer Kim.

Toronto-based Roynat Equity Partners has acquired aviation communications company SkyTrac for an undisclosed sum.

SkyTrac makes satellite data, text and voice communication products for airplanes and helicopters in the oil & gas, air medical, law enforcement and search and rescue industries. Roynat is purchasing the business from founder and owner Kathleen Wallace, who is retiring. The firm is investing in SkyTrac alongside Malachi Nordine, the company’s director of product development, who will become SkyTrac’s new president, and aerospace industry veteran Stephen Sorocky, who will act as executive chairman of the board.

“The bulk of our deals that we’re seeing are succession-related or generation transfer in one way or another,” Roynat managing director Elmer Kim told Private Equity International. “We’re still seeing a lot of the owner-operator businesses able to be transferred.”

The deal marks Roynat’s second acquisition and sixth investment of 2012, including minority investments and financings. The firm also acquired Ontario-based document management software company Doc-It in June.

“We’re happy with our pacing” Kim said, adding that 2013 “looks pretty good” based on the level of opportunities and activity the firm has seen in 2012. “These are smaller than $10 million equity cheques, [and] there are fewer private equity groups in Canada chasing that down than there would be in the US.”

The firm typically invests between $3 million and $20 million per deal.

Roynat Equity Partners is a division of a C$3 billion entity owned by the Bank of Nova Scotia, and has invested in a variety of industries during the past 12 months, including food, software, distribution and oil field services. Roynat has more than $300 million of committed capital and offices in Toronto, Calgary and Montreal.

Roynat is led by president and chief executive officer Rania Llewellyn, who joined Scotiabank 17 years ago, and managing partner Wray Stannard, who has been with Roynat since 1988.