TorQuest Partners confirmed today it has completed the acquisition of VersaCold Logistics Services, one of Canada’s largest cold storage warehousing and food logistics firms, from KingSett Capital and Ivanhoé Cambridge.
It’s the latest acquisition this year in a sector which has drawn huge international attention as the pandemic and changing consumer habits have focused more scrutiny on logistics.
In the announcement Wednesday morning, TorQuest said it is partnering with The Investment Management Corporation of Ontario (IMCO) and OPTrust on the acquisition.
Financial terms were not disclosed, but earlier published reports about the negotiations by Bloomberg said KingSett and Ivanhoé were seeking in excess of $637 million for the firm.
“We are excited to be partnering on this investment with the VersaCold team,” said Jonathan Fraser, a partner at TorQuest, in the announcement.
“VersaCold is an attractive business with significant growth potential, and we look forward to capitalizing on the company’s recent success by continuing to leverage its strategic locations, commitment to food safety and outstanding customer service.”
First investment for $1.4B TorQuest fund
This is the first investment for TorQuest Partners Fund V, a $1.375 billion fund which closed in March 2020.
VersaCold’s management team, including Mike Arcamone, who has been elevated from president and chief operating officer to CEO, will invest alongside the new investors and will continue to operate the business. He succeeds Paul Campbell, who returns to his prior role with KingSett.
“We welcome this investment and look forward to working with our new partners to capitalize on growing demand for cold storage logistics solutions,” said Arcamone in the release.
“There will be no changes to the day-to-day operations as a result of the transaction and we remain fully committed to giving our customers the very best end-to-end supply chain solution available.”
VersaCold bills itself as “Canada’s largest end-to-end supply chain solutions company focused exclusively on the handling of temperature-sensitive products.”
The company’s logistics services include a national network of storage facilities, transportation fleet and a supporting network of technological capabilities.
VersaCold founded in B.C.
Now based in Vaughan, just north of Toronto, VersaCold traces its roots to the B.C. Ice & Cold Storage Co., which was formed in 1946 to serve the province’s fishing industry.
During the 1980s, it owned eight facilities in Western Canada, and began a series of mergers and acquisitions that expanded its holdings across the continent and into Australia, New Zealand and Argentina. The offshore holdings were sold in 2010.
Today, according to its website, VersaCold operates 31 warehouses and distribution centres in addition to the transportation fleet.
“We are proud of the work we have done to help establish VersaCold as an industry leader in Canada, with a strong management team and culture,” Campbell said in the release. “We know the company is in good hands with Mike and his team, as well as the new investors – and we wish them success.”
Busy year in cold-storage sector
This is the second major cold-storage transaction with a strong Canadian connection during 2020. Earlier, Oxford Properties Group was among a group of investors who poured more than $2.1 billion into California-based Lineage Logistics.
Oxford’s share of the investment was $474 million.
Internationally, the largest cold storage sector transaction involved the sale of AGRO Merchants Group by Oaktree Capital Management to Americold Realty Trust. That deal was valued at more than $2.2 billion.