Velan's New Guard: A Legacy Cedes Control for a Shot at Growth

MONTREAL, QC – June 15, 2026 – In a move that signals the end of an era for one of Quebec’s industrial mainstays, Velan Inc. has officially passed from family control into the hands of private equity. The C$203.9 million transaction, which saw the Velan family’s holding company sell its controlling interest to Toronto-based Birch Hill Equity Partners, is more than a simple changing of the guard. It’s a calculated pivot, trading a 75-year legacy for a strategic injection of capital and a new playbook aimed at aggressive global growth.

The deal closes a chapter that began in 1950, transforming the industrial valve manufacturer into a portfolio company of a firm managing over C$6 billion in capital. With the transition comes a complete overhaul of the company's board and executive suite, a move designed to support what all parties are calling Velan’s “next phase of growth.”

A Strategic Succession

The departure of Ivan, Peter, Rob, and Tom Velan from the board of directors marks the formal conclusion of the family’s direct stewardship. For generations, the Velan name was synonymous with the company’s identity, rooted in engineering and manufacturing excellence. The acquisition by Birch Hill represents a fundamental shift from a legacy-driven enterprise to a growth-oriented asset in a private equity portfolio.

Birch Hill, however, has been careful to frame the acquisition as a partnership rather than a takeover. “We have immense respect for the 75-year legacy the Velan family has built,” said Birch Hill COO and Partner Pierre Schuurmans at the time of the deal's announcement. “We look forward to building on this foundation and supporting the Company’s continued growth and innovation.”

This sentiment reflects Birch Hill's established investment philosophy. The firm is known for taking controlling stakes in Canadian mid-market companies that are at a strategic “inflection point.” Rather than short-term asset stripping, Birch Hill’s model favors a longer investment horizon, often seven years or more, focusing on operational improvements and market expansion. With 74 investments and 60 successful exits since 1994, their track record suggests a methodical approach to value creation. The appointment of Birch Hill Partner Patrick Duncan as the new Chairman of the Board solidifies their hands-on approach.

Fueling the Growth Engine

To pilot this new chapter, Velan has turned to trusted insiders. Rishi Sharma, a seasoned executive who previously served as Chief Financial Officer, has been promoted to President and CEO. He is joined by Imran Gibbons, the former Vice President of Global Financial Planning and Analysis, who now steps into the CFO role. This decision signals a desire for continuity and deep institutional knowledge at the operational helm, even as the governance structure undergoes a seismic shift.

In his first public comments as CEO, Sharma expressed gratitude for the past and optimism for the future. “With the support of Birch Hill’s long-term investment plan, we are well positioned to accelerate the execution of our strategy, invest in the capabilities that will strengthen our competitiveness and continue building a stronger business,” he stated. His assertion that Velan enters this new phase from a “position of strength” is not just rhetoric; recent company performance shows a strong order backlog of $548.1 million, the highest in three years, and a 22.8% increase in sales in the most recent quarter.

Bolstering this strategy is a new US$80 million revolving credit facility. This financial tool is critical, designed to enhance liquidity, lower the cost of capital, and retire other debt. This move effectively cleans up the balance sheet and provides Sharma’s team with the dry powder needed to pursue strategic initiatives, from product development to market expansion, without being hamstrung by legacy financial constraints. It is the tangible expression of Birch Hill’s commitment to funding growth.

The Modern Blueprint for Traditional Industry

The Velan acquisition is a microcosm of a larger trend: the increasing role of private equity in modernizing Canada’s traditional industrial sector. Firms like Birch Hill are targeting established companies with strong engineering foundations, global footprints, and entrenched market positions, recognizing that with the right capital and strategic oversight, their potential can be unlocked.

This is not just about financial engineering. Birch Hill brings a modern toolkit, including an internal data science team, to bear on its portfolio companies, seeking efficiencies and growth opportunities that a more traditional management structure might overlook. For a company like Velan, which competes in demanding sectors like nuclear power—evidenced by its recent agreement to support a small modular reactor project in Ontario—this blend of industrial heritage and data-driven strategy could be a powerful combination.

While the transition from a family-run business to a private equity-backed entity can be culturally disruptive, the new leadership’s focus on building a “stronger business for our employees” aims to bridge that gap. The market, for its part, has responded with cautious optimism. On the day of the announcement, Velan’s stock saw a modest but notable increase, suggesting investors see the logic in trading a storied past for a well-capitalized and strategically focused future. This transaction represents a calculated bet that the next 75 years of Velan’s story will be written not just with the ink of tradition, but with the capital of ambition.