Grenville has delivered a portfolio IRR well in excess of its cost of capital and peer group. As of June 30, 2016, the Company’s last reported quarter, Grenville’s portfolio IRR since inception was 21%. The Company’s portfolio IRR consists of returns from royalty payment income, interest income and contract buyouts.   In light of these returns, the Board believes that shareholder value is maximized by reinvesting free cash flows to continue compounding capital at these rates. The board will review a return to the dividend model as cash flow permits.

As part of its growth strategy, Grenville has entered into two separate joint venture agreements. Investments by the joint ventures will be incremental to Grenville’s investment, thereby providing additional scale to the business model and enabling Grenville to participate in a greater number of opportunities. This syndication of risk will allow Grenville to build a more diversified portfolio and generate more stable returns with non-dilutive capital.  Collectively, Grenville will provide capital for 50 percent of each investment while the new partners will provide 100 percent of the joint venture capital in exchange for the right to use Grenville’s intellectual property and royalty-based investment strategy, and the right to invest 25 percent in each new royalty investment made by Grenville. The new joint venture partners have expressed interest in investing a higher percentage should Grenville request additional investment.

Foregrowth Joint Venture

Foregrowth Holdco Inc, (“Foregrowth”) a wholly-owned subsidiary of Gravitas Ilium Corporation (“GIC”), and Grenville have formed a joint venture, Foregrowth-Grenville Investments Inc. (“FGI”), that will have the right to co-invest in each new royalty investment made by Grenville. Foregrowth through a limited partnership that Foregrowth is the General Partner of (“Foregrowth LP”) expects to raise capital to be advanced to the joint venture while Grenville will manage the joint venture and be compensated through a management fee. Excess returns after costs and loan payments will be shared on an 85/15 basis between Foregrowth and Grenville. Foregrowth LP expects to advance 100 percent of the joint venture’s share of capital for initial investments. As the inaugural product for the Foregrowth platform, Grenville will be attending the launch ceremony with the China Entrepreneurs Club in Niagara this week.

Darwin Joint Venture

Darwin Strategic Royalty Corporation (“Darwin”) is a private investment company owned by Louis Desmarais and Brad Romoff, well-known Montreal-based venture capitalists. Grenville has agreed to license its intellectual property and royalty-based investment strategy to Darwin for the purposes of purchasing royalty streams in the province of Quebec and throughout North America, as well as co-investing alongside Grenville in new investment opportunities. Grenville will hold a seat on Darwin’s Investment Committee and Grenville will receive 6 percent of all royalty income generated by Darwin.

“We are delighted to be able to announce closing of these two joint venture relationships. Our new partners represent sources of capital and capital markets expertise that will contribute scale to our unique royalty-based financing model for small and medium sized enterprises (“SMEs”),” said Steve Parry, Chief Executive Officer of Grenville. “We believe this joint venture ecosystem will be a powerful force in the royalty market for SMEs in North America, providing Grenville and the partners with an enhanced ability to rapidly diversify portfolios with fewer dollars. Based on our experience to date, we believe this is a key to optimizing portfolio return with stable cash flows.”

“The returns that the model has provided made a compelling case to reinvest in growth rather than continue to return capital in light of the challenging capital markets environment we face. The decision to suspend the dividend, while difficult, places us in the best position to generate long-term value for shareholders, specifically with the opportunity to increase our investment velocity with the support of our new partners,” continued Mr. Parry.

Grenville’s unique capital offering continues to fill an expansive niche in North American SME, growth-capital markets. Grenville’s investment strategy targets a range of $1 million to $2 million per new investment. Based on experience since inception, investment returns are optimized within this size range relative to larger or smaller investments. The joint ventures with Foregrowth and Darwin enable Grenville to scale its portfolio across a broader number of investment opportunities while still providing sufficient growth capital to help investees achieve their growth objectives.

New investments will generally be focused on technology and industrial-tech opportunities with higher-growth fundamentals. Existing portfolio investments with similar fundamentals have outperformed the other invested sectors to date. Opportunities that match this profile provide Grenville an opportunity to actively support these investments to achieve the next stage of their growth through new capital and by working with investee management teams.

“The overall portfolio returns achieved to date validate our business model. Our primary focus moving forward is to actively redeploy cash flows and contract buyout proceeds into new investments alongside our partners at pricing levels consistent with those to date, to deliver long-term shareholder value,” said Mr. Parry.

About Grenville
Based in Toronto, Grenville is a publicly-traded royalty company that makes investments in established businesses with revenues of up to $50 million dollars. Grenville generates revenues from royalty payments and buyouts from contracts. The non-dilutive royalty financing structure offered by Grenville competes directly with traditional equity to meet the long-term financing needs of companies on more attractive commercial terms.

About Gravitas Ilium Corporation
Gravitas Ilium Corporation (www.gicpartners.com) is a financial services holding company jointly owned by Ilium Capital Corp. and Gravitas and, both headquartered in Toronto.

About Gravitas Financial Inc.
Gravitas Financial Inc. (“GFI”) is a financial services, research and analytics holding company providing, through its various subsidiaries, capital market services to individual, private and public company clients. GFI conducts its operations from its head office in Toronto, Canada. GFI intends to utilize the public company platform and enhanced access to capital to grow its existing business and to provide new and enhanced products to its clients.

For further information, please contact:
‍Grenville Strategic Royalty Corp.
Steven Parry
Chief Executive Officer
Tel: (416) 777-0383

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