Alternative asset manager Onex Corp. bounced back from pandemic-induced losses a year ago, reporting US$472-million in profits on Friday from its private equity and credit investments.
Toronto-based Onex is making money after losing US$1.05-billion in the first quarter of last year, when the company wrote down the value of its investments due to the pandemic. Onex owns conference operators and travel-related companies such as WestJet Airlines Ltd., which have seen sales plummet due to COVID-19 restrictions.
“Our private equity investments continued to generate strong value and our credit platform is seeing momentum with its new strategies,” said Gerry Schwartz, Onex’s founder and chief executive officer, in a press release.
Onex was founded in 1984 and launched a credit business in 2007 that invests in non-investment grade debt. The portfolio now accounts for US$16-billion of Onex’s US$37.2-billion in assets under management. In the first three months of the year, Onex’s profit included US$56-million of gains from its credit portfolio and US$296-million from gains on its private equity investments.
Onex has put US$290-million into private equity investments so far this year, and US$123-million into credit strategies. The company holds US$910-million in cash. Onex spent US$27-million buying back its own shares this year, after buying back US$444-million of its stock in 2020.
Despite significant writedowns on its investments in the first quarter of last year, Onex earned a US$860-million annual profit in 2020.
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Andrew Willis