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AMERICAS
Pioneer generates twice as much annual cash as Hess, but the all-stock transactions value Pioneer at just 6.35 times its 12-month cash flow compared with 11.65 times for Hess, Reuters reported.
This means Chevron is paying close to double the price for every dollar of acquired cash flow compared with Exxon. The discrepancy shows how Chevron values Hess' production prospects more highly than Exxon values Pioneer's.
Brookfield Renewable, one of the world's largest owners and operators of renewable power and climate transition assets, completed the acquisition of the utility-scale commercial renewables business of Duke Energy, an American electric power and natural gas holding company, for $2.8bn.
"The completion of this sale marks the final step in our transition to a fully regulated utility. As we work to address the growing needs of our customers in our regulated jurisdictions, we will continue investing in cleaner energy resources and significant grid enhancements that will deliver value and energy resiliency to our customers and stakeholders," Lynn Good, Duke Energy Chair, President, and CEO.
ORMAT Technologies, a global provider of renewable energy solutions, agreed to acquire geothermal and solar portfolio, that consists of approximately 150 MW of operational geothermal and solar facilities, from Enel, a manufacturer and distributor of electricity and gas, for $271m.
"The deal is in line with Enel’s Strategic Priorities, leveraging on asset rotation to foster returns on capital employed in support of future development plans while achieving a progressive simplification of the Group’s structure," Enel.
Enel is advised by Jefferies & Company.
CIRCA Jewels, an international buyer of pre-owned jewelry, gemstones and watches, agreed to merge with Worthy, a premier online auction house, in a $100m deal.
"Combining with Worthy creates an even larger, more powerful platform with greater scaling opportunities. Consumers are embracing luxury jewelry and watch resale now more than ever, and our combined platform is ideally positioned to capture this demand. Together, we will empower sellers by offering greater flexibility, either through in-office purchases or online auctions. Our category expertise and deep product knowledge creates a significant advantage over generalist resale platforms and will allow us to continue expanding the market, while bolstering our leadership position in the space," Oren Schneider, CIRCA CEO.
Worthy is advised by Kekst CNC.
Roark Capital-backed Youth Enrichment Brands, a youth enrichment franchise platform, completed the acquisition of School of Rock, a performance-based music education provider, from Sterling Partners, a private equity firm. Financial terms were not disclosed.
“We’re thrilled to add School of Rock to our Youth Enrichment Brands platform and help support its next chapter of growth. As the leader in the music education space, School of Rock fits seamlessly with our other category-defining brands. Rob Price, the leadership team, and the company’s dedicated franchisees have built a differentiated and thriving business that will greatly contribute to our mission of helping every kid discover and develop lifelong passions," Justin Hoeveler, Youth Enrichment Brands CEO.
Pearl Street Equity, a private equity firm, completed the acquisition of a franchising business from Famous Brands International, a company that markets and distributes its products such as cookies, frozen yogurt, brownies, chocolates, nuts. Financial terms were not disclosed.
“We are thrilled about this new chapter for Famous Brands Franchising as a stand-alone company and are confident Pearl Street is the ideal strategic partner for the future. This transaction will take our franchisee support to the next level while enabling investment to grow both brands globally and bring our delicious products to more customers and families,” Joe Lewis, Famous Brands Franchising President and COO.
Pearl Street Equity was advised by Joele Frank (led by Tim Ragones).
Procaccianti Companies-backed Smith Hill and Bain Capita, two private equity firms, agreed to form a joint venture in a $1bn deal. Financial terms were not disclosed.
“Rising interest rates coupled with lender pullback in the real estate debt capital markets has created a significant opportunity to deliver flexible financing solutions to high-performing, growth-oriented hospitality borrowers. We believe our joint venture with Smith Hill Capital is tailor-made for this moment in hospitality because it combines decades of industry and capital markets experience with a highly attractive market opportunity,” David DesPrez, Bain Capital Managing Director.
Bain Capital is advised by Stanton PRM (led by Charlyn Lusk).
WEX, a global commerce platform, agreed to acquire Payzer, a high-growth, cloud-based, field service management software provider, for $261m.
“We are thrilled at the prospect of providing an exciting new offering for our Mobility customers with the anticipated acquisition of Payzer. Payzer's top-tier service offering and feature set is at the convergence of SaaS and payments. Payzer is an example of us finding a high-growth market with a customer base that overlaps with our current customer footprint, with a great product and service offering to address the needs of these customers,” Melissa Smith, WEX Chair, CEO and President.
United Parcel Service, a multinational shipping & receiving and supply chain management company, agreed to acquire Happy Returns, a software and reverse logistics company, from PayPal, a multinational financial technology company. Financial terms were not disclosed.
“We know that returns have long frustrated shoppers and retailers looking for quick and easy solutions. By combining Happy Returns’ easy digital experience and established drop-off points with UPS’s small package network and footprint of close to 5,2k The UPS Store locations, box-free, label-free returns will soon be available at more than 12k convenient locations in the US,” Carol B. Tomé, UPS CEO.
ConocoPhillips weighs CrownRock bid to challenge rivals.
ConocoPhillips is considering an offer for CrownRock, an energy producer in the west Texas area of the Permian basin as consolidation in the sector picks up pace. Houston-based Conoco, has expressed interest in participating in the sale process for privately held CrownRock, which is valued between $10bn and $15bn.
Diamondback Energy, Devon Energy, Marathon Oil and Continental Resources are also studying potential bids for CrownRock, Reuters reported.
Bain Capital explores options for $5bn Rocket Software. (FS)
Bain Capital is exploring options including a sale of Rocket Software, which could be valued at more than $5bn, including debt, in a transaction, Bloomberg reported.
The private equity firm is planning to solicit interest in the Waltham, Massachusetts-based company in 2024. Bain hasn’t made a final decision to pursue a sale and its plans could still change. Rocket is also continuing to pursue growth, including via acquisitions of its own.
Silver Lake working on offer to buy Endeavor Group. (FS)
Silver Lake Management, the private equity group, is considering making a takeover bid for Endeavor, the talent agency and entertainment company behind World Wrestling Entertainment and Ultimate Fighting Championship, Bloomberg reported.
The statement followed Endeavor’s announcement that it’s weighing strategic options for its businesses, which includes its original talent-management business, combat sports like WWE and a variety of other assets including Professional Bull Riders. Silver Lake’s Co-CEO, Egon Durban, is Chairman of Endeavor, which is led by Hollywood superagent Ari Emanuel.
Choice Hotels asks Wyndham to engage in merger talks.
Choice Hotels had asked the board of US budget hotel operator Wyndham Hotels and Resorts to engage in merger talks, Reuters reported.
This comes about a week after Wyndham rejected Choice's $7.8bn acquisition offer, deeming it "underwhelming" and citing regulatory risks around a potential deal.
"We respect Wyndham's desire to achieve the best outcome for its shareholders, but that can't happen if Wyndham unilaterally ends our discussions," Patrick Pacious Choice CEO.
Private credit lenders giving up protections to win bigger deals.
Private credit firms seeking to capture market share from traditional bank lenders are giving up investor protections as they snag larger financings.
Direct lenders have been siphoning business from the broadly-syndicated leveraged loan market in recent years, in part by staking a claim to increasingly larger deals. But an analysis by the credit-rating firm shows that legal safeguards that protect investors tend to weaken as the size of the transactions increase, Bloomberg reported.
Toymakers Hasbro, Mattel slump after sounding alarm over holiday spending.
Toymaker Hasbro disappointed investors with its results, joining Barbie-maker Mattel in warning of a weak holiday season and indicating that consumers are being frugal heading into the most important period for retailers, Reuters reported.
Demand across the toy industry has weakened since a pandemic surge as consumers re-allocate their budget to cover for household essentials amid rising prices and higher borrowing costs.
Textron raises profit forecast as private jet demand holds steady.
Textron raised its full-year adjusted earnings forecast after beating estimates for quarterly profit, betting on demand for its business jets despite higher prices, Reuters reported.
The Cessna parent now expects full-year adjusted profit per share of between $5.45 and $5.55, an improvement over its previous expectation of $5.20 to $5.30. Demand for private jets remains resilient after surging during the pandemic when the wealthy took control of their travel as a result of public health concerns.
Lazard quarterly profit misses estimates on dealmaking drought.
Lazard missed Wall Street estimates for third-quarter profit, as the independent investment bank's advisory business reeled from a prolonged slump in dealmaking. Tighter monetary policy and escalating geopolitical tensions have held back corporate dealmaking, putting pressure on some of Wall Street's biggest banks to announce layoffs and other cost cuts, Reuters reported.
"On the M&A front, we think that the market is bottoming out. Client discussions have been turning more constructive over the past several months," Peter Orszag, Lazard CEO.
Tesla gets $100m US ultra-fast charger order from BP EV charging unit.
BP's electric vehicle charger unit is ordering $100m worth of Tesla ultra-fast chargers for rollout in the US, the first deployment of Tesla's chargers on an independent network, Reuters reported.
The purchase is part of BP Pulse's plans to invest up to $1bn in charging stations across the US by 2030 and it offers EV market leader Tesla a new revenue stream.
Soaring Treasury yields threaten long-term performance of US stocks.
Soaring US Treasury yields are further boosting the appeal of bonds over stocks, deepening an already painful equity selloff while threatening to weigh on equity performance over the long term.
This year’s climb in Treasury yields is changing that calculus, as government bonds offer income that is viewed as risk-free to investors who hold them to term. The yield on the benchmark 10-year US Treasury - which moves inversely to bond prices - hit 5% earlier this week, its highest level since 2007, in a climb fueled by hawkish Fed policy fears and fiscal worries, Reuters reported.
Ackman's bet against US Treasuries pays off with $200m profit.
Billionaire hedge fund manager Bill Ackman, who traditionally invests in stocks, earned roughly $200m from a bet against US 30-year Treasury bonds, Reuters reported.
"The economy is slowing faster than recent data suggests. There is too much risk in the world to remain short bonds at current long-term rates," Bill Ackman.
Flourish Ventures raises $350m more for fintech-focused global venture fund. (FS)
US-based investor Flourish Ventures has announced raising another $350m for its early-stage, open-ended venture fund that invests globally, including in Southeast Asia, DealStreetAsia reported.
The fresh commitment brings the firm’s total assets under management to $850m, which includes an initial investment of $200m and the additional $300m obtained during its spinoff from Omidyar Network in 2019.
UPenn fights back against billionaire ultimatum as divisions rise. (People)
Scott Bok has spent decades advising corporate titans on how to fend off hostile takeovers. Now he’s in a fight of his own against a growing list of billionaires who are angry over his work at the University of Pennsylvania, Bloomberg reported.
The chairman of Greenhill is being forced to defend Penn President Liz Magill and his own position as chair of the board of trustees, while a group of alumni and students demand the exit of both leaders amid a growing storm over antisemitism on campus and Bok’s treatment of some of the school’s Jewish trustees.
EMEA
Bain Capital, an American private investment firm, Corbis, a company operating mainly in the infrastructure, mining & metals and electric power sector, Security Trading, an investment company, and Fennogens Investments, an investment management firm, completed the acquisition of Caverion, an industrial services provider, for $1.3bn.
“The offer made by the consortium provides clear evidence that Caverion’s goal to achieve “Sustainable Growth” by delivering to our customers along the building’s lifecycle and assisting in their Smart Building and green transitions is an attractive strategy for the future. I believe that with the support and resources from Bain Capital and the Consortium we will be able to further accelerate our business and deliver value to all stakeholders. We at Caverion continue our daily work as usual, focusing on serving our customers and working together across the company,” Jacob Götzsche, Caverion President and CEO.
Caverion was advised by Bank of America and Castren & Snellman (led by Janne Lauha). Bain Capital was advised by Advium Corporate Finance, BNP Paribas, Goldman Sachs, Nordea Bank (led by Alexandra Therman-Londen), UBS, Hannes Snellman, Kirkland & Ellis, and Roschier Attorneys (led by Petri Avikainen). Debt financing was provided by Goldman Sachs. Goldman Sachs was advised by Sullivan & Cromwell (led by Juan A. Rodriguez) and White & Case (led by Ken Barry). Triton was advised by Danske Bank, Deutsche Bank, JP Morgan, Avance (led by Ulf-Henrik Kull) and Tekir. Debt financing was provided by DNB Bank, Danske Bank, Deutsche Bank, JP Morgan, OP Corporate Bank and Swedbank.
TowerBrook Capital, an investment management company, completed the acquisition of a majority stake in Team EIFFEL, a specialist professional services provider. Financial terms were not disclosed.
“With Gilde as a strong and committed shareholder, a dedicated, talented management team, a group of highly skilled expert consultants and sound strategic choices in brand, culture, and service, we have managed to grow to where we stand today. We aim to enhance our impact by not only continuing to grow in our home market but also by developing our service offering across Europe. We are pleased to welcome TowerBrook as a new shareholder and we are looking forward to delivering these ambitious plans together," Gert-Jan Meppelink, Team EIFFEL CEO.
Team EIFFEL was advised by Boston Consulting Group, Citigroup, Ernst & Young and Simmons & Simmons. TowerBrook Capital was advised by Roland Berger, 1602 Capital Partners, Alvarez & Marsal, RBC Capital Markets, Goodwin Procter (led by Christian Iwasko) and Loyens & Loeff (led by Roel Fluit).
Epiris, a private equity manager, completed the acquisition of GSF Car Parts, a supplier of aftermarket automotive parts, from LKQ, a provider of alternative aftermarket, specialty salvage and recycled auto parts. Financial terms were not disclosed.
“GSF serves a large and resilient market: in the UK there are more than 25m cars that are over three years old, and all need to be maintained to the standards set by the MOT test. GSF has an established position supplying the myriad products required to maintain these vehicles, with an offering built on customer service, product range and availability. We look forward to building on the strong platform that the GSF team have created," Chris Hanna, Epiris Partner.
Epiris was advised by AJ Gallagher, DC Advisory (led by Michael Mariaz), JLL Corporate Finance, Macfarlanes, PricewaterhouseCoopers, Endava and Greenbrook (led by Peter Hewer). Debt financing was provided by Atlantic Park. GSF Car Parts was advised by Robert W Baird (led by Adam Czaia).
TGS, a scientific data and intelligence provider to companies active in the energy sector, completed the merger with PGS, a technologically focused oilfield service company, in a $2.6bn deal.
“We are excited to announce a merger with PGS, completing a major milestone of building a fully integrated and robust global energy data provider. Our clients will benefit from scale, a unique technology portfolio and premier service quality. Bringing together two distinct, yet complementary, companies positions us even better for a continued upcycle in the energy sector", Kristian Johansen, TGS Chief Executive Officer.
PGS was advised by Pareto Securities and BAHR. TGS was advised by SpareBank 1 Markets and Schjodt.
Rhône, a private equity firm, agreed to acquire a 40% stake in Orkla, a supplier of bakery and ice cream ingredients for $555m.
“The partnership search for OFI attracted strong interest. I am proud that we are joining forces with a best-in-class organisation in Rhône. The Rhône team’s partnership commitment and strategic attributes clearly stood out. This is a landmark deal for Orkla that puts OFI in a position to continue its organic and structural growth journey. This transaction is an example of the flexibility and value creation ambition that we have sought to create with Orkla’s new operating model,” Nils K. Selte, Orkla President and CEO.
Rhône is advised by Rothschild & Co and Brunswick Group (led by Alex Yankus). Orkla is advised by Bank of America.
Public Investment Fund, a private equity firm, and Pirelli, a tire manufacturer, agreed to form a joint venture in a $550m deal.
“Through this Joint Venture with Pirelli, PIF is building production capabilities in the automotive and mobility value chain and enhance opportunities for private sector contribution. This collaboration marks another pivotal milestone in our journey to diversify the economy, enhance sustainability and localize manufacturing capabilities in Saudi Arabia,” Yazeed A. Al-Humied, PIF Deputy Governor and Head of MENA Investments.
Pirelli is advised by JP Morgan.
Apax, a private equity firm, completed the investment in GAN Integrity, a provider of technology that enables proactive, integrated, real-time management and monitoring of third-party and employee risk, ethics and compliance programs. Financial terms were not disclosed.
"We’re incredibly excited to partner with Apax in this next stage of our journey. This investment provides us with the resources and flexibility to execute on our ambitious customer product road map and growth plans, providing even more organisations around the world with a platform that makes good governance effortless. With our talented team, and Apax’s unique insights and operational expertise, we have an exciting future ahead," Nicholas Manolis, GAN Integrity CEO.
Apax was advised by Kekst CNC.
Trafigura-backed Congo miner puts itself on sale amid debt woes.
A mining company in the Democratic Republic of Congo backed by commodity trader Trafigura Group has put itself up for sale after a slump in the cobalt price left it struggling to finish key projects, Bloomberg reported.
The attempted sale of Chemaf Resources comes after the company’s ambitious expansion drive ran into financial trouble, leaving it in need of fresh investment. The firm is trying to build one of the biggest copper and cobalt mines in Congo, as well as two new processing plants, and last year arranged a $600m loan from Trafigura.
Wagamama parent gets offer feelers from PizzaExpress owner. (FS)
The Wagamama owner, which has been struggling with falling margins amid soaring costs and sluggish recovery post-pandemic, will consider Wheel's proposal.
Payments stocks wipeout hits $80bn on worldline shock.
France’s Worldline cut its outlook and plummeted about 60%, dragging Adyen and Nexi down with it. The moves came just one day after newly-listed CAB Payments plunged 72% in London after reducing its revenue guidance, making it the world’s worst major initial public offering this year, Bloomberg reported.
Once the domain of the biggest global banks, payments companies became a darling of private equity and stock market investors over the past decade as the sector expanded into everything from providing card-readers at store checkouts to apps that allow everyday customers to split bills to the plumbing behind billions of transactions a year for global blue-chip companies.
Mercedes says 'brutal' EV market will pressure car sales margins.
Mercedes-Benz said a "brutal" electric vehicle market of heavy price cuts and supply chain issues meant it would likely hit the lower end of its 12-14% adjusted return on sales forecast for the cars division, as third-quarter earnings fell, Reuters reported.
The luxury carmaker said it remained committed to its EV targets, but could bolster earnings with better returns from its combustion engine portfolio if margins on EVs remained lower than previously assumed.
JLR to build electric Defender model at Slovak plant.
Jaguar Land Rover will produce an electric version of its signature Defender vehicle as part of plans to launch nine fully electric models by 2030, with manufacturing based at its plant in Slovakia, Reuters reported.
The British carmaker, which is owned by India's Tata Motors, said earlier this year it will invest $18.1bn over the next five years to develop electric vehicles, with a new electric Jaguar coming in 2025.
Siemens Energy shares slide 39% after company seeks guarantees from German government.
Shares in Siemens Energy plunged nearly 40% on October 26, wiping €3bn ($3.16bn) off its market value, after it was in talks with the German government about state guarantees after major setbacks at its wind division, Reuters reported.
Siemens Energy shares slid to all-time lows on the news, down more than 39% at 1055 GMT, implying a €3.3bn ($3.49bn) loss in market value.
Ozempic craze drives big flows into pharmaceutical, Danish funds.
Investors piled into exchange-traded funds tracking Novo Nordisk in the last three months as the Danish drugmaker rides a wave of demand for its diabetes and weight-loss drugs Ozempic and Wegovy, Reuters reported.
The VanEck Pharmaceutical, which has Novo Nordisk, among its biggest holdings and total assets of $414m, has seen net inflows of $52m from August 8, even as prices fell 2.8%. Meanwhile, Novo's shares have climbed 27% and rival Eli Lilly has rallied 31.7% since August 8.
Sofinnova Partners raises $200m digital medicine fund. (FS)
Sofinnova Partners, a leading European life sciences venture capital firm, announced the successful close of Sofinnova Digital Medicine I at €190m ($200m), significantly exceeding its target.
“The successful closing of Sofinnova Digital Medicine I above its target size marks yet another milestone in our growth as a global firm fostering disruptive innovations in life sciences. This newest fund in our platform of investment strategies is a testament to the trust our limited partners place in our vision and to Sofinnova’s longstanding commitment to shaping the future of healthcare,” Antoine Papiernik, Sofinnova Chairman and Managing Partner.
AXA IM Private Capital unit to launch NAV financing fund. (FS)
A unit of AXA Investment Managers is raising a new fund to provide so-called net-asset-value loans, an increasingly popular financing option for private equity firms in difficult markets, Bloomberg reported.
The fund manager’s AXA IM Prime business has already raised about $400m from institutional investors for the vehicle. AXA is an anchor investor in the fund.
BluePeak Private Capital announces final closing of its flagship fund at $156m. (FS)
BluePeak Private Capital, an alternative asset manager firm supporting the growth of scalable businesses in Africa through privately negotiated and structured debt like instruments, has reached final closing at $156m for its inaugural private capital fund, BluePeak Private Capital Fund SCSp.
The African Development Bank and South Africa-based private investor Sango Capital are the most recent investors to back the Fund, marking their first ever commitments to a private debt fund. They join development finance institutions, BII, EIB, US DFC, FMO, SwedFund and CDC Tunisia, who backed the Fund at initial closing.
Ex Oliver Wyman Italy CEO Scardovi joins Deloitte. (People)
Claudio Scardovi, the former head of Oliver Wyman in Italy, has joined Deloitte Financial Advisory as equity partner to strengthen the firm's M&A and private equity advisory services, Reuters reported.
After stints in KPMG and Accenture, Scardovi founded Intervaluenet, which was taken over in 2002 by management consultancy firm Oliver Wyman. Scardovi led Oliver Wyman Italia as chief executive for the following five years.
Unilever’s Plan to revive growth underwhelms investors. (People)
Unilever named a new CFO and replaced division heads as new CEO Hein Schumacher promised to revive a company whose ability to win market share dropped to a record low, Bloomberg reported.
The Dutch executive said Unilever will focus investment on its top 30 brands, which represent around three-quarters of revenue, to drive growth, while paring back other parts of its portfolio.
APAC
Stellantis, a multinational automotive manufacturing company, agreed to acquire a 20% stake in Leapmotor, an automobile manufacturer, for €1.5bn ($1.6bn).
“As consolidation unfolds among the capable electric vehicles start-ups in China, it becomes increasingly apparent that a handful of efficient and agile new generation EV players, like Leapmotor, will come to dominate the mainstream segments in China. We feel it’s the perfect time to take a leading role in supporting the global expansion plans of Leapmotor, one of the most impressive new EV players who has a similar tech-first, entrepreneurial mindset to ours. Through this strategic investment, we can address a white space in our business model and benefit from Leapmotor’s competitiveness both in China and abroad. I want to thank Mr. Zhu Jiangming and the teams from both sides of our great companies for their leadership and collaboration in creating this new opportunity for both of us,” Carlos Tavares, Stellantis CEO.
SK Hynix says won’t agree to Western Digital-Kioxia merger.
SK Hynix declared its opposition to a merger of Kioxia and Western Digital, introducing more uncertainty to a landmark US-Japanese deal years in the making, Bloomberg reported.
SK Hynix “is not agreeing to the deal at this time in light of the overall impact on the value of the company’s investment” in Kioxia, Kim Woohyun CFO. The company “will make a decision for the sake of all stakeholders, including not only the shareholders but also Kioxia.”
Partners Group shows initial interest in Australian resort island. (FS)
Private equity firm Partners Group has shown initial interest in Hamilton Island as the family owners of the holiday destination in Australia conduct a strategic review for the asset, Bloomberg reported.
The buyout firm is studying the resort island for a potential bid. Partners Group and the Oatley family, who own Hamilton Island, have held preliminary discussions.
Japanese mid-market PE firm NSSK raises $665m for third fund. (FS)
Japanese buyout firm Nippon Sangyo Suishin Kiko announced that it secured JPY100bn ($665m) in total commitments for its third investment vehicle NSSK III, DealStreetAsia reported.
The fund, which was launched in May 2021, managed to close above its target despite global uncertainties, NSSK said. It secured commitments from existing and new investors.
McDonald's India franchisee Westlife posts surprise profit drop on higher costs.
Westlife Foodworld, which operates McDonald's restaurants in west and south India, reported a surprise drop in quarterly earnings on October 26 as increased costs overshadowed higher sales of its burgers and fried chicken, Reuters reported.
The franchisee said consolidated net profit after tax fell to INR223.7m ($2.7m) in the July-September quarter from INR315.4m ($3.79m) a year earlier.
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