OMERS tech fund raises C$260 million from Cisco, Bank of Montreal

By John Tilak and Euan Rocha

TORONTO (Reuters) - OMERS Ventures, one of Canada's biggest venture-capital firms, said on Monday it has raised about C$260 million ($200 million) for a second fund to invest mainly in early-stage technology companies.

Lead investors in the fund are Bank of Montreal (Toronto:BMO.TO - News), Cisco Systems (NasdaqGS:CSCO - News) and the Ontario Municipal Employees Retirement System (OMERS), parent of OMERS Ventures.

The funding comes almost four years after OMERS Ventures raised C$210 million in its first round.

Investments in the Canadian technology industry have been gathering momentum in recent months, driven by a steady stream of funding and capital-raising.

Canadian venture capital investments soared to C$1.19 billion in the first half of 2015, a 33 percent increase from the first half of last year and the strongest first half since 2002, according to data from Thomson Reuters.

"This second fund validates the opportunities that OMERS and our partners, Cisco and BMO, see in the Canadian innovation landscape," OMERS Ventures Chief Executive John Ruffolo said.

The initial public offering of Canadian e-commerce company Shopify Inc (Toronto:SH.TO - News) in May was one of the highlights in the Canadian market this year.

OMERS Ventures invested in Shopify before its IPO and was one of the big winners from the offering. Shopify's shares were priced at $17 in the United States in May and have doubled in value since then.

"We are very bullish on the Canadian technology sector," said David Wismer, managing director at BMO Capital Markets. "(The) second fund is an important example of more capital being made available to help grow Canadian technology companies."

BMO led Kinaxis (Toronto:KXS.TO - News) in an initial public offering last year and has also advised Hootsuite and Real Matters in their funding rounds.

Companies in the OMERS Ventures portfolio include BuildDirect, Hootsuite, Vision Critical, Wattpad and Desire2Learn.

(Reporting by John Tilak and Euan Rocha; Editing by Peter Galloway, Steve Orlofsky and Alan Crosby)