Onex

[Guest kawikaho]

Anyone know about this Canadian mini Berkshire?  It's really not like Berkshire (actually, it's more like Blackstone), but it has compounded invested capital by nearly 30% compounded.  It's a private equity company, and it looks pretty good.  Anyone have any info?

[Zorrofan]

I took a look at them a few years back when they started setting up institutional investment funds. They seem to have structured it so that they (management) personnally earn a sizable chunk when the investment fund does well (performance bonus), Onex shareholders not so much....just my $0.02

 

cheers

Zorro

[ubuy2wron]

Its cheap but perhaps deservedly so. Mr. Swartz really has stacked the deck in his favour as far as compensation is concerned. Salary, bonuses ,options, performance fees. This company generates a ton of investment fees for the investment banks so any buy recommendation or research is pretty suspect however they do seem to have a better track record than most in the levered buyout private capital space. Its probably trading below liquidation value.

[mranski]

You might want to read Buffett's comments on PE firms in the annual report. I think it says quite alot and is very well said.

[Guest kawikaho]

Much thanks for the replies, everyone.

[netnet]

I looked at them a number of years ago.  For some reason I could not get totally comfortable; I think it was that I could not intelligently say that I thought they could continue to execute in all types of environments, particularly as they got bigger.

 

Looking at the charts, I don't see that they have been compounding at 30% per year, unless they had some nice dividends over the years (essentially, they are flat for the last 5 and up 7X over the last 15 years.)

 

If they are liquid, have access to more capital, and didn't over pay during the bubble times, then they could be a nice addition to your portfolio. After you dig through and finish your research, I would be interested in what you think.

[Guest kawikaho]

The stock has performed 14-15% CAGR in the past 20 years.  The return on invested capital has been much better.  ONEX has funds that allow certain class of individuals to participate in things like leveraged buyouts, etc... and those have done very well.  The common equity of the company hasn't done as well.