{"id":811014,"date":"2026-07-18T23:08:50","date_gmt":"2026-07-18T23:08:50","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/811014\/"},"modified":"2026-07-18T23:08:50","modified_gmt":"2026-07-18T23:08:50","slug":"meet-the-investors-and-entrepreneurs-shopping-to-keep-canadas-defence-supply-chain-sovereign","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/811014\/","title":{"rendered":"Meet the investors and entrepreneurs shopping to keep Canada\u2019s defence supply chain sovereign"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

Rym Leulmi is an entrepreneur looking to acquire a defence technology company.Adil Boukind\/The Globe and Mail<\/p>\n

Rym Leulmi is considering moving herself and her two young children from Montreal to rural Nova Scotia to run a defence technology company. <\/p>\n

The electrical engineer, with an MBA, a master\u2019s degree in nanotechnology and 15 years of experience in management roles, may not have worked in this specific field, but she knows an opportunity when she sees one.<\/p>\n

That opportunity is a roughly 60-year-old business owner who\u2019s ready to retire, with no succession plan and a business that\u2019s on track to benefit from the federal government\u2019s massive uptick in defence spending. <\/p>\n

So, Ms. Leulmi is on a mission to acquire it, fulfilling her own dream of being a business owner and, inadvertently, helping Ottawa achieve its goals of building out a sovereign supply chain.<\/p>\n

\u201cI\u2019m really excited about it, but it\u2019s a roller coaster,\u201d she said.<\/p>\n

How Halifax\u2019s \u2018defence city\u2019 dreams are running into a riptide of infrastructure risks<\/a><\/p>\n

Ms. Leulmi is not alone. She\u2019s one of several acquisition-minded Canadian investors and entrepreneurs combing through the country\u2019s established businesses, some facing succession questions, to find the makers key to helping Ottawa pull off its ambition to establish a homegrown defence supply chain. <\/p>\n

These businesses are the parts and components makers, the small- to medium-sized businesses who make the tread that goes on a tank, for example, or the sensors that are used to detect underwater activity. They build the essential parts that make up the larger whole, feeding into the supply chain rather than creating it.<\/p>\n

Ian Whytock, managing partner at Tidal Venture Partners and co-founder of Vimy Forge, an accelerator for Canadian defence companies, calls these companies the \u201cmissing middle.\u201d<\/p>\n

\u201cThere\u2019s a lot of emphasis and interest being placed on defence innovation and the opportunities within defence innovation, and rightly so,\u201d he said. <\/p>\n

\u201cBut I feel like we\u2019ve almost over indexed, and we\u2019ve forgotten about Canada\u2019s defence suppliers.\u201d<\/p>\n

The federal government, as well as several industry organizations, are doing their best to map the sector and paint a picture of which companies exist and the roles they play, given Ottawa\u2019s goal to spend 5 per cent of Canada\u2019s gross domestic product on defence by 2035 in line with NATO targets. <\/p>\n

However, what they haven\u2019t captured through this data collection is how many of those companies are about to face succession or transition challenges, Mr. Whytock said. \u201cMany of them are owner operators who are in their 60s or 70s and do not have a succession plan on that business, and I actually think that\u2019s a national security crisis.\u201d<\/p>\n

Opinion: Can Carney\u2019s big military spending save Canada\u2019s economy? (Or should it?)<\/a><\/p>\n

About 61 per cent of small- and medium-sized businesses, or SMBs, are led by owners aged 50 and up, and nearly one in five plan to exit within five years, according to a 2026 survey by the Business Development Bank of Canada. At the same time, more than 90 per cent of the Canadian defence industry is made up of SMBs, according to a report by Innovation, Science and Economic Development Canada and the Canadian Association of Defence and Security Industries based on data collected in 2024. <\/p>\n

These are the figures attracting private equity investors and entrepreneurs to businesses valued between $5-million and $50-million with defence sector potential, said Raphael Amram, a partner at Osler, Hoskin & Harcourt LLP. <\/p>\n

They\u2019re not necessarily the biggest or most exciting businesses. They\u2019re often relatively unknown, located in rural areas and don\u2019t sell directly to the government. Yet, their role in the supply chain is unmistakable and it\u2019s growing in importance as Canada looks to become less reliant on the United States. <\/p>\n

\u201cAnd if they\u2019re left to be ignored or they\u2019re purchased by foreigners, then all of a sudden we have a very vulnerable part of our supply chain related to national security concerns being unattended,\u201d Mr. Amram said. <\/p>\n

Plus, there are likely even more SMBs with parts that are useful to the growing defence industry, such as commercial aviation or automotive companies, who haven\u2019t even considered selling into it yet, said Ugo Dionne, an entrepreneur and president of the M&A Club Canada. <\/p>\n

\u201cBut with people getting a little older running these businesses, I\u2019m not sure they\u2019re going to want to take the risk to pivot and start serving the defence industry. So, there\u2019s a huge opportunity for searchers to acquire businesses that have that potential,\u201d he said.<\/p>\n

That\u2019s what Ms. Leulmi is \u2013 a \u201csearcher.\u201d It\u2019s a term used to describe people who are pursuing entrepreneurship-through-acquisition, a method through which people can come to run their own businesses without necessarily having to start from scratch as a founder.<\/p>\n

For example, to help with her entrepreneurship journey, Ms. Leulmi raised an approximately $700,000 fund from 13 investors to cover the costs of her search. When she finds the right business, her investors have already committed capital to contribute to an acquisition, allowing her to buy a business valued between around $20-million and $55-million. <\/p>\n

She didn\u2019t necessarily set out to buy a defence business but given one of her criteria is the company must be in a growing industry, the sector was a natural fit.<\/p>\n

Opinion: Guns and butter: The true cost of Canada\u2019s military spending is yet to be tallied<\/a><\/p>\n

Defence is an attractive market for a lot of searchers right now, said S\u00e9vrine Labelle, managing director of the Business Development Bank of Canada\u2019s Thrive Entrepreneurship Through Acquisition Fund.<\/p>\n

For many of these companies with owners nearing retirement, the right searcher could be key for tapping into new opportunities at home and abroad.<\/p>\n

\u201cThey can become an amazing new owner for these businesses, driving the energy, the innovation and the growth for the years to come, and especially now with all the investments that have been announced by the Canadian government,\u201d Ms. Labelle said.<\/p>\n

Plus, the implications of what happens to a business if it\u2019s not acquired by the right person \u2013 or acquired at all \u2013 are strategically significant, said Peter Dawe, senior vice-president of defence strategy at BDC.<\/p>\n

These companies have valuable certifications, security clearances and supplier relationships that so many newer companies are scrambling to secure, Mr. Dawe said. \u201cTrust in the defence sector is particularly important and that\u2019s really difficult to replicate.\u201d<\/p>\n

He added, \u201cWhen you lose one of these companies, or if one of these companies doesn\u2019t have an appropriately mapped out succession plan, then you effectively lose the company from that supply chain, and the implications of that in defence can be significant.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: Rym Leulmi is an entrepreneur looking to acquire a defence technology company.Adil Boukind\/The…\n","protected":false},"author":2,"featured_media":811015,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[45,49,48,137,6347],"class_list":["post-811014","post","type-post","status-publish","format-standard","has-post-thumbnail","category-entrepreneurship","tag-business","tag-ca","tag-canada","tag-entrepreneurship","tag-ne-i"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/811014","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=811014"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/811014\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/811015"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=811014"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=811014"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=811014"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}