New investment vector: climate solutions

Frédéric Martel has held the position of CEO of Claridge since the 1st of January, when he succeeded Pierre Boivin, who had been managing the investment group since 2011. The new CEO is not a newcomer to the family office since he joined it in 2005 as head of investments before becoming Chief Investment Officer in 2015.

“I was recruited because the CEO of Claridge at the time wanted to diversify the team and was looking for an engineer with experience as an investment banker. That’s what I was,” says Frédéric Martel, engineer and MBA.

“At the beginning, I was responsible for the direct investment strategy in the agri-food sector and global investments via international private investment funds, then, with the arrival of Pierre Boivin in 2011, we reviewed the strategy and developed investments in real estate, entertainment and technology.”

At the time, Claridge notably acquired the company Plats du chef, which had revenues of 20 million in 2007 and which totaled more than 250 million when the group sold it in 2017.

In 2015, Pierre Boivin appointed Frédéric Martel as Chief Investment Officer, which also included liquid markets – stocks and bonds. Claridge relies on three asset classes which are equally divided by a third: liquid markets, direct investments, and private investment funds.

“We are a long-term investor. We take positions longer than five or seven years. We go up to 10 years and beyond, this is Stephen Bronfman’s approach to supporting companies, especially since we have stopped taking 100% stakes. We are either the majority or control with other partners and investors and we support the operators,” explains Frédéric Martel.

Claridge’s direct investments are spread across four sectors: food and beverage, entertainment, real estate, and technology. The assets of the family office are almost equally distributed among these four sectors and total between 1.5 and 2 billion, a figure that Frédéric Martel does not want to specify, since the group is private.

New reality, new sector

In the agri-food sector, Claridge has reviewed its strategy and is investing in health sectors, such as the company WeCook, which offers ready-to-eat healthy meals, Califia Farms, a company which manufactures plant-based beverages, 49th Parallel, a manufacturer of high-end coffee, and Champlain Seafood, the primary processor of lobster and crab in North America.

The group also set up and manages a private agri-food investment fund in which Investissement Québec, Desjardins and FSTQ have invested.

In 2013, Claridge diversified its holdings by acquiring the Caisse de dépôt’s share in Solotech, a world-class player in the live events sector.

“We helped Solotech expand beyond Quebec and establish itself in the United States: in Las Vegas, Nashville, Los Angeles, where the group has equipment parks, and in England, where Solotech has made acquisitions. There, they want to expand in Europe and the Middle East, and that is why the Caisse has just returned with an investment of 75 million,” explains Frédéric Martel.

In real estate, Claridge acts as a financier by taking stakes in various residential, industrial, or logistical projects orchestrated by real estate developers, mainly in Quebec. The group has set up a real estate fund with the Caisse de dépôt and another family office.

Finally, Claridge has returned to investing in technology, where the group takes minority venture capital stakes with partners like Inovia directly in companies. Claridge also operates in Israel’s Silicon Valley where a team of specialists directly invest growth capital in tech companies.

“We returned to the technology sector. The only investment we had was a stake in Facebook before its IPO, which we sold a few years after its listing. It paid off,” says the CEO.

Claridge is entering a new stage in its development since the family office will begin its investments in companies that develop climate solutions in 2024, which is part of the business plan for the next 10 years.

“Stephen is very keen on it. He has been a director of the David Suzuki Foundation for 25 years and he wants Claridge to do its part to tackle the problems of climate change, it is one of the top priorities.”

“We will start by investing with outside experts, but we want to eventually bring specialists internally who will be able to help us identify the companies that will make the difference. Stephen wants to develop expertise in Quebec, but also internationally, particularly in Israel, where there is a lot of development in climate solutions,” believes the CEO.

According to Frédéric Martel, climate solutions will become the fifth pillar of Claridge’s investment structure and will ultimately occupy an important place in the assets of Stephen Bronfman’s family office.

Source: La Presse Article originally published by La Presse in French, translated to English.