Canadian fund poised to increase One51 stake over 33% before IPO

A Canadian public pension fund manager is poised to increase its stake in One51 to more than 33 per cent as the Irish rigid plastics manufacturer restructures itself ahead of a planned stock market flotation within the next 18 months, The Irish Times has established.

Quebec-based Caisse de Dépôt et Placement du Quebec (CDPQ), bought a 25 per cent stake in One51 in May from businessman Dermot Desmond. However, CDPQ also holds owns 22 per cent of IPL, a North American company plastics company that makes everything from yogurt pots to refuse bins, in which One51 acquired a controlling 67 per cent interest two years ago.

One51, led by chief executive Alan Walsh, said on Friday that it was "commencing a shareholder engagement process to outline a proposed corporate reorganisation of One51 and in particular the IPL structure that would position the group for an IPO within that time frame".

Sources said the plan involves CDPQ and Canadian government agency Fonds de Solidarité, which owns 11 per cent of IPL, swapping their combined interest in the firm for a stake in the One51 group. IPL accounts for about 80 per cent of One51’s revenues.

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Liability

The two Canadian firms currently have a right to force One51 to buy them out in 2021. As a result of an increase in IPL’s earnings in the first half of this year, the Irish company has had to increase the liability for such a purchase to €83.4 million in June from €72.2 million in December.

However, One51's board has decided it would be best to resolve the issue now, through the issuance of fresh stock in itself, to simplify the group's corporate structure before attempting an IPO. A spokesman for the company declined to comment, while spokesmen for CDPQ and Fonds de Solidarité did not respond to efforts from The Irish Times to secure comment.

Combining One51’s current €317 million market value, based on recent trading of its shares on a grey market, with the issuance of €83.4 million of stock would boost the group’s equity value to about €400 million.

On that basis, the CDPQ’s stake in One51 would increase to about 33 per cent, while Fonds de Solidarité would end up with about 7 per cent.

Renamed

One51, which currently has about 2,000 shareholders in Ireland, was set up in 2005 as an investment business spun out of food and agri group IAWS and initially held assets including a 26 per cent stake in infrastructure company NTR and Irish Pride Bakers. IAWS was subsequently renamed Aryzta.

Mr Walsh has spent his seven years in charge of One51 unravelling the firm’s collection of disparate investments, including a major stake in ferries operator Irish Continental Group.

The company virtually completed its divestment programme in the first half of this year with the sale of its CircleClear UK and Irish hazardous waste businesses.