Province puts economic development fund in MMF hands

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This article was published 23/06/2023 (1079 days ago), so information in it may no longer be current.

The Progressive Conservative government is handing over control of a multimillion-dollar economic development fund to the Manitoba Métis Federation.

On Friday, Economic Development Minister Jeff Wharton announced the Métis Economic Development Fund would be dissolved and its assets transferred to the Louis Riel Capital Corp., an affiliate of the MMF.

The fund was created in 2011, and launched with an initial taxpayer-supported capital investment of $10 million over six years. The provincial government and MMF were the sole members of the fund.

Wharton said the fund has since invested $11 million into Métis businesses and has leveraged an additional $28 million to support entrepreneurs. An estimated 1,200 jobs have been created through investments in eight companies which include a local brewery, plastics company, oil refinery and others.

“This tremendous support has allowed Métis entrepreneurs to pursue and launch a diverse range of businesses and initiatives in construction and manufacturing, in oil and gas and trucking, in telecommunications and restaurants and in many other sectors in Manitoba’s economy,” Wharton said, noting the transfer is part of the provincial government’s commitment to economic reconciliation.

“I’m confident knowing this fund under the direction of the Manitoba Métis Federation will continue to promote entrepreneurship, nurture community development and cultivate cultural pride far into Manitoba’s future.”

According to the MMF, the transfer will give the organization autonomy over investments and will expand the range of support programs.

“The ability to make decisions with our citizens who are on the lakes or on the land or in the cities and seeing the opportunities, and that’s exactly, I think, what (Wharton) and the MMF have been working towards,” MMF housing and property management minister Will Goodon said.

Goodon said his father, Irvin, started his businesses as a young man harvesting oak trees to sell as fence posts to farmers, and developed the enterprise to a major agricultural builder in western Manitoba.

However, Goodon said the path to entrepreneurship was not easy for a young Métis person and his father could not access bank loans and faced discrimination.

“But he had that hunger, as a lot of our entrepreneurs do,” Goodon said. “They have these ideas, the creativity, the ideas that see a hole in the market that needs to be filled — and I believe that this is absolutely what this fund is going to be: helping more people move into the future.

“We’re in a different world than we were when my dad was a young entrepreneur, but at the same time, we want to support, provide that wraparound services to our entrepreneurs.”

MEDF chief executive officer John Coutris said it supported projects valued between $1 million and $5 million, and provided a maximum capital investment of $500,000. Typically, the non-profit fund held its investment in companies between three and seven years and then exited its position, he said.

Over the past 12 years, the fund has made eight investments and completed just shy of 70 transactions. It has exited two of its investments and averaged a return of nearly eight percent, with an average hold period of 5.5 years, Coutris said.

The fund’s activity is estimated to have contributed $40 million back to the economy, he added.

The LRCC will expand the work of the MEDF and provide commercial loans as well as grants, business plan support, advisory services and other entrepreneurship initiatives, officials said.

“We will continue to support the acquisition, expansion and growth of Red River Métis citizens as they take advantage of this marketplace,” Goodon said.

A provincial spokesperson said the value of the fund was not immediately available because companies MEDF has invested in are not publicly traded, and as such, equity position value cannot be determined on a regular basis.

Company valuation and associated equity position is determined at point of investment decision and once the equity is bought out, investment and return are paid out, the spokesperson said.

danielle.dasilva@freepress.mb.ca