Tuesday, August 13, 2013

Normand Provost to Retire From the Caisse

The Caisse de dépôt et placement du Québec released a statement, Normand Provost announces his intention to retire:
After more than 33 years of service, Normand Provost, Executive Vice-President, Private Equity, has announced his intention to retire from the Caisse de dépôt et placement du Québec. Mr. Provost will continue in his current role until his successor is appointed in 2014. He will then remain with the Caisse as a strategic adviser to the President.

The Caisse has launched a search process to identify a successor in preparation for the departure of Mr. Provost, who oversees the Private Equity team in addition to the Caisse's initiatives to contribute to Québec's economic development.

Michael Sabia, the Caisse's President and Chief Executive Officer, paid tribute to Mr. Provost: "Normand is one of the key builders of the Caisse we know today. He established our current private equity business model, assembled teams and successfully generated solid, sustainable results throughout his career, during all phases of the market cycle."

"Since 1980, he has used his unparalleled business judgment, exceptional qualities as a negotiator and strong ability to deliver results to serve our organization, our depositors and Québec's economic development. The strength of his commitment has made him one of the pillars of what the Caisse is today. On behalf of the entire team at the Caisse, I would like to thank him sincerely for his remarkable contributions and, on a more personal note, for the high-quality strategic advice he has given me," Mr. Sabia added.

According to Robert Tessier, Chairman of the Caisse, "Very few people can match Normand Provost's in-depth knowledge of the Caisse. To be able to benefit from such experience combined with solid judgment is invaluable for a board of directors. On behalf of my colleagues, I would therefore like to acknowledge the great value he has contributed to the Board's strategic thought process and decision making, in addition to his outstanding work as an executive of the Caisse."

During his career at the Caisse, Mr. Provost has held various positions, from Adviser and Investment Manager for midsize businesses, to President and Chief Executive Officer of CDP Capital - Americas, the Caisse's private equity subsidiary. During his time with the Caisse, he has covered every aspect of corporate financing and has brought hundreds of transactions to fruition.

Since September 2009, backed by his extensive knowledge of the Québec business community, Mr. Provost has also assumed the leadership of all the Caisse's initiatives in Québec.

In addition to his responsibilities in the investment sector, Mr. Provost served as Chief Operations Officer from April 2009 to March 2012, overseeing the transformation of operations and information technology at the Caisse.

He drew on his many years of experience at the Caisse to introduce a more client-centric approach and enhance the agility and efficiency of the teams responsible for operations and information technology.
I never met Normand Provost but heard many good things about him. Anyone who has worked 33 years at the Caisse has seen it all. Mr. Provost and his team have built up a very impressive private equity portfolio and he is leaving on a high note.

Over the weekend, I was researching co-investments in private equity where I skimmed through a report by Prequin put out last year, LP appetite for private equity co-investments. I note the following:
...LPs with an appetite for co-investments tend to have sizeable allocations to private equity. Sixty-six percent of LPs with such an interest have over $250mn allocated to the asset class, and a significant 13% have a private equity allocation in excess of $5bn. Canada-based CDP Capital – Private Equity Group, for example, has C$15.7bn currently allocated to private equity and dedicates 50% of its portfolio to direct and co-investments.
Like other large Canadian funds, the Caisse invests through funds but it also invests directly and through co-investments. In order to do this, they have built up their internal capabilities, hiring private equity professionals who can co-invest along with top GPs or invest directly in companies.

There have been a few snags along the way but the success of the Caisse's private equity program is a true testament of Mr. Provost's leadership. He has served this organization well and deserves the praise he's receiving.

As far as who his successor will be, I can think of a few names but I'm sure it will be someone who is extremely qualified and someone who will continue to build on the success of the private equity program.

Below, Apollo Global Management LLC, the private-equity firm run by Leon Black, said second-quarter profit increased more than 10-fold as the value of its fund holdings climbed and it realized profits by selling investments. Devin Banerjee reports on Bloomberg Television's "Money Moves."

Make sure you read my latest on why despite the good times, the pressure is on private equity.