Onex Third-Quarter Earnings More Than Double to $97 Million

Distributable earnings, which include recurring fee-related earnings, realized investment gains and carried interest from private-equity and private-credit funds, fell to $89 million from $111 million a year earlier. Private-equity fee-related revenue edged up to $21 million from $20 million, while structured-credit fee-related revenue held at $30 million. Asset-management fee-related earnings rose to $14 million from $11 million.

Onex’s other investing capital segment posted a 72% increase in net earnings, to $86 million, largely because of a fair-value gain from private equity. Its recent investment in specialty insurer Convex recorded a $12 million fair-value loss. At the end of September, Onex valued its Convex investment at $4.1 billion, broadly unchanged from the prior quarter; Convex’s tangible book value remained flat at $3.5 billion. Convex reported third-quarter net income of $132 million, which Onex said would have lifted book value but was offset by unrealized losses on its fixed-income portfolio as interest rates rose. Since Onex completed its purchase of a 63% controlling interest in Convex in February, the insurer’s valuation has increased by $323 million, or 8%.

Chief Executive Bobby Le Blanc said Onex Partners completed the first close of its Onex Partners VI vehicles, securing more than $2 billion in capital commitments and exceeding expectations. In credit, the company raised or extended $3.5 billion of collateralized loan obligations and generated $20 million in quarterly fee-related earnings from structured credit.

Onex Partners and co-investors completed the purchase of Canadian fractional private-jet operator AirSprint in August. In May, Onex’s middle-market buyout arm agreed to sell its controlling stake in U.S. event organizer Emerald to Apollo Global Management in a deal valuing Emerald at about $1.5 billion. Onex had $161 million in cash and near-cash at Sept. 30, down from $2.1 billion at the end of last year, and said it had access to $600 million of undrawn revolving-credit capacity. Its assets under management totaled about $56.5 billion, including $9.6 billion of its own investing capital.