AMERICAS
Cenovus Energy, a Canadian integrated oil and natural gas company, is set to merge with Husky Energy, a Canadian-based energy company, in a $2.9bn deal. After the deal closes, Cenovus shareholders would own 61% of the combined entity, with Husky shareholders controlling the rest. Hong Kong tycoon Li Ka-shing-controlled Hutchison Whampoa would hold a 15.7% stake in the new company.
“We will be a leaner, stronger and more integrated company, exceptionally well-suited to weather the current environment and be a strong Canadian energy leader in the years ahead. The diverse portfolio will enable us to deliver stable cash flow through price cycles, while focusing capital on the highest-return assets and opportunities. The combined company will also have an efficient cost structure and ample liquidity. All of this supports strong credit metrics, accelerated deleveraging and an enhanced ability for return of capital to shareholders,” Alex Pourbaix, Cenovus President and Chief Executive Officer.
Husky Energy is advised by CIBC World Markets, Goldman Sachs, Norton Rose Fulbright, Joele Frank and Osler Hoskin & Harcourt. Cenovus Energy is advised by RBC Capital Markets, TD Securities, Bennett Jones and Paul Weiss Rifkind Wharton & Garrison. Hutchison is advised by Skadden Arps Slate Meagher & Flom and Stikeman Elliott.
The US Department of Justice announced that it is requiring Waste Management, the provider of comprehensive waste management environmental services in North America, to divest assets in order to proceed with its $4.6bn acquisition of Advanced Disposal Services, the fourth largest solid waste company in the US, that was announced in April.
The Antitrust Division of the US Department of Justice filed a civil suit, along with a proposed settlement, that paves the way for Waste Management to finally close the deal.
The proposed settlement requires the divestiture of 15 landfills, 37 transfer stations, 29 hauling facilities, over 200 waste collection routes and other assets across 10 states. GFL Environmental is the planned buyer of a package previously valued at $863.5m.
Advanced Disposal is advised by UBS, Mayer Brown and Shearman & Sterling. UBS is advised by Sullivan & Cromwell. Waste Management is advised by Centerview Partners, Simpson Thacher & Bartlett, Vedder Price and Joele Frank. CPPIB is advised by Debevoise & Plimpton.
Blackstone Real Estate Income Trust, a perpetual-life, institutional quality real estate investment platform, agreed to acquire Simply Self Storage, a self-storage company, from Brookfield, for $1.2bn.
“This transaction is a complementary addition to BREIT’s high-quality portfolio of income-generating real estate, which is heavily weighted towards logistics and multifamily primarily in growth markets. Simply Self Storage is a best-in-class company with significant potential for growth through future acquisitions in a highly fragmented sector, and similar to logistics, self-storage is a resilient sector through economic cycles because of low tenant turnover, minimal maintenance costs and stable cash flows. We look forward to continuing to acquire high quality assets on behalf of our BREIT investors," Frank Cohen, BREIT Chairman and CEO.
BREIT is advised by Deutsche Bank and Simpson Thacher & Bartlett. Brookfield is advised by Bank of America Merrill Lynch, Newmark Group, RBC Capital Markets and Fried Frank Harris Shriver & Jacobson.
AE Industrial Partners, a private equity firm, completed the acquisition of PCI, a provider of cybersecurity, computer network operations, cloud, systems engineering, enterprise IT, and data analytics to the intelligence and defense communities. Financial terms were not disclosed.
"We believe that PCI, with its full spectrum of solutions and premier relationships, is well-positioned and aligned with the national security community's most strategic priorities. We look forward to working closely with the world-class team at PCI," Jeffrey Hart, AEI Principal.
PCI is advised by Aronson Capital Partners and Miles & Stockbridge. AEI is advised by Ernst & Young, Kirkland & Ellis and Lambert & Co.
Bayer to acquire Asklepios Bio for c. $4bn.
Bayer, a global enterprise with competencies in the life science fields of health care and nutrition, agreed to acquire Asklepios Bio, an unlisted US biotech firm, for c. $4bn. Closing of the transaction is contingent on customary closing conditions, including receipt of the required regulatory approvals, and is expected to take place during the fourth quarter of 2020.
“As part of our strategy, we are building new therapeutic platforms including cell and gene therapies. As an emerging leader in the rapidly advancing field of gene therapies, the expertise and portfolio of AskBio supports us in establishing highly innovative treatment options for patients and further strengthens our portfolio. We want to help patients whose medical needs are not yet met by today’s treatment options and we are looking forward to work together with the team at AskBio,” Stefan Oelrich, Bayer Member of the Board of Management and Bayer Pharmaceuticals Division President.
Bayer is advised by Credit Suisse and Baker McKenzie. AskBio is advised by JP Morgan and Ropes & Gray.
PAE to acquire CENTRA Technology for c. $208m.
PAE, a global company in delivering smart solutions to the US government and its allies, agreed to acquire CENTRA Technology, an independent provider of high-end intelligence support, information analytics, engineering services and other advanced technology solutions, for c. $208m.
“The acquisition firmly aligns with PAE’s strategy of expanding the business to higher-margin market areas. By acquiring CENTRA, PAE realizes a significant milestone in the execution of our strategic growth plan to be a provider of innovative, higher-margin, knowledge-based offerings in attractive, resilient end markets. This exciting opportunity builds on our intelligence analysis capabilities while increasing customer access, accelerating growth and enhancing shareholder value. Additionally, the acquisition of CENTRA is expected to be accretive to adjusted EBITDA margins and free cash flow,” John Heller, PAE President and CEO.
CENTRA is advised by Citizens Capital Markets and Greenberg Traurig. PAE is advised by Renaissance Strategic Advisors and Morgan Lewis & Bockius.
Liberty Latin America confirms that the company has entered into a consent judgment with the US Department of Justice regarding the previously announced acquisition of AT&T’s wireless and wireline operations in Puerto Rico and the US Virgin Islands. The DOJ has cleared the transaction subject to the terms of the consent judgment, which includes a requirement that Liberty Latin America divest certain B2B operations that are part of their operations in Puerto Rico. Liberty Latin America expects a preliminary court order in the next few days permitting them to close on their transaction with AT&T, FT reported.
“The merger, as originally structured, would have eliminated competition for critical fiber-optic-based telecommunications services that businesses in Puerto Rico rely on every day. Settlement will ensure that businesses throughout Puerto Rico continue to benefit from vigorous competition in the provision of these services,” Makan Delrahim, Justice Department’s Antitrust Division Assistant Attorney General.
Liberty is advised by Ropes & Gray, Credit Suisse and LionTree Advisors.
Ansys, an engineering simulation software provider, agreed to acquire Analytical Graphics, provider of mission-driven simulation, modeling, testing and analysis software for aerospace, defense and intelligence applications, for $700m. The 67% of the consideration will be paid in cash and 33% will be paid through the issuance of Ansys common stock.
"Ansys' acquisition of AGI will help drive our strategy of making simulation pervasive from the smallest component now through a customer's entire mission. It will also expand the use of simulation in the key aerospace sector, where the stakes can be at their highest levels. We are excited to welcome the expert AGI team – and to expand the reach of their world-class technology to industries outside of aerospace, including for autonomy and 5G applications," Ajei Gopal, Ansys President and CEO.
Ansys is advised by Allen & Company, Fairmount Partners and Joele Frank.
Quarles Petroleum, a regional provider of residential and commercial fuels, agreed to acquire propane and petroleum operations of Dixie Gas & Oil, third-generation family-owned propane, commercial fuels and home heating oil distributor based in Verona, Virginia. Financial terms were not disclosed.
"We believe that Dixie's customers will be in great hands with Quarles. Our family has invested 75 years in Dixie, we're pleased that the Quarles family has a similar history in the industry and, as a family-owned firm, understands our commitment to our customers," Christopher Earhart, Dixie Gas & Oil President.
Dixie is advised by Matrix Capital Markets Group and Nelson McPherson Summers & Santos.
Lion Equity Partners, a Denver-based private equity firm, completed the acquisition of distributors of linens T-Y Group and Harbor Linen from Bed Bath & Beyond, an American chain of domestic merchandise retail stores. Financial terms were not disclosed.
“The company is a highly strategic fit with our existing portfolio company, Riegel Linen. The combination will form an industry-leading provider of textiles and amenities for hotels, cruise lines, restaurants, commercial laundries, linen suppliers and healthcare facilities," Jim Levitas, Lion Equity Co-Founder and Partner.
EVOTEK, enabler of secure digital business, agreed to acquire Mystic River, an intelligent automation services provider. Financial terms were not disclosed.
"Robotic Process Automation is the next frontier to support the digital workforce movement. This acquisition is about much more than a purchase of brilliant ideas and technology. This is about the coming together of relationships and cultures. I have known Brian for nearly a decade and previously built a successful business together. He is the perfect addition to EVOTEK, as is the next-generation business he founded. This will be another differentiator for the company, further highlighting that the days of the box-pushing-VARs are over," Cesar Enciso, EVOTEK Founder and CEO.
Intermountain Healthcare and Sanford Health declare intent to merge.
Intermountain Healthcare, a company at the forefront of value-based and digital healthcare, and Sanford Health, rural health care delivery and clinical research system, have signed a letter of intent to develop a strategic partnership.
"Intermountain and Sanford have a shared vision of the future of healthcare and have the aligned values needed to better serve more communities across the nation. This merger enables our organizations to move more quickly to further implement value-based strategies and realize economies of scale. Through coordinated care, increased use of telehealth and digital health services, we will make healthcare more affordable for our communities," Marc Harrison, Intermountain Healthcare President and CEO.
Dunkin' Brands considers potential sale to Inspire Brands.
Dunkin' Donuts and Baskin Robbins chains owner Dunkin' Brands Group has held preliminary discussions to be acquired by Inspire Brands, a private equity-backed restaurant company, Reuters reported.
The deal being discussed would take Dunkin’ Brands private at a price of $106.50 a share. Inspire’s portfolio includes more than 11k Arby’s, Buffalo Wild Wings, SONIC Drive-In, Rusty Taco, and Jimmy John’s locations worldwide.
“There is no certainty that any agreement will be reached,” Karen Raskopf, Dunkin’ Brands Chief Communications Officer.
GoldCamps acquires gold assets near Bathurst camp.
Canadian GoldCamps agreed to acquire, through the purchase of a private BC corporation, thirteen mineral claims referred to as the Elmtree and Alcida Gold Claims, located in New Brunswick, Canada.
"This asset is an additional building block in the company's evolving Atlantic Canada strategy, as well as its strategy of consolidating exciting projects in known Gold Camps across Canada. The company intends to have critical mass wherever it operates and to truly be not only an exploration company, but also a development company with a pipeline of the most promising projects at every stage from new discovery to pre-production," Alex Terentiew, GoldCamps President & CEO.
Blackstone raised $8bn for long-term PE fund. (FS)
Blackstone Group's private equity business raised $8bn for a fund that aims to hold companies for longer periods than its typical investments, Bloomberg reported.
The firm's second core private equity fund will be more than 70% larger than its first, which closed in 2016. Investments will focus on essential business services and companies with compelling intellectual property or content. The group’s previous long-term fund made investments that included music-rights company SESAC Holdings and Servpro Industries, a provider of cleaning and emergency restoration services.
Blackstone was advised by Simpson Thacher & Bartlett
Charles Ergen-backed CONX cuts IPO size. (FS)
CONX, a blank-check company, led by billionaire Charles Ergen, downsized its IPO, the latest special-purpose acquisition company to cut its offering size in recent weeks.
The company is now looking to raise $750m, selling 75m shares at $10 apiece, its regulatory filing showed. It had earlier aimed to raise $1bn. Ergen is the chairman of Dish Network, a satellite TV provider, and also serves as the chairman of satellite operator EchoStar. Deutsche Bank Securities is the underwriter for CONX's offering.
EMEA
Automakers Fiat and PSA are set to win EU approval for their $38bn merger of equals, Reuters reported.
Previously, to allay EU antitrust concerns, PSA has reportedly offered to strengthen Japanese rival Toyota Motor, with which it has a van joint venture, by ramping up production and selling it vans at close to cost price.
Fiat Chrysler is advised by Bank of America Merrill Lynch, Barclays, Citigroup, Goldman Sachs, JP Morgan, UBS, D'Angelo & Co, Darrois Villey Maillot Brochier, De Brauw Blackstone Westbroek, Legance, Loyens & Loeff, Sullivan & Cromwell, Community Group, Image Sept and Sard Verbinnen & Co. Financial advisers of Fiat Chrysler are advised by Cleary Gottlieb Steen & Hamilton and Macfarlanes. PSA is advised by Mediobanca, Messier Maris & Associes, Morgan Stanley, Perella Weinberg Partners, Bredin Prat, Cabinet Bompoint, Linklaters and Stibbe. Peugeot is advised by Zaoui & Co. Bpifrance is advised by Willkie Farr & Gallagher. Exor is advised by Lazard.
Bridgepoint Capital, a pan-European private equity investor focused on the middle market, completed the acquisition of credit business from EQT Partners. Financial terms were not disclosed.
"This is an important step on our path of focusing on investment strategies which can fully utilize EQT’s governance and impact ownership model. We are delighted to have found such a great new home for the Credit business segment and the dedicated team of credit specialists. Together with Bridgepoint, the Credit platform is well-positioned to capture the future growth prospects and develop its offering even further," Christian Sinding, EQT CEO.
EQT was advised by Macfarlanes, JP Morgan, Kirkland & Ellis, Travers Smith and Kekst CNC. Bridgepoint was advised by PricewaterhouseCoopers, Rothschild & Co, Clifford Chance, Simpson Thacher & Bartlett and Brunswick Group.
Spirit AeroSystems, which manufactures and distributes aerospace equipment and Bombardier, a Canadian multinational manufacturer of business jets and rail, announced they have changed the terms for Spirit's acquisition of Bombardier's aerostructure business by decreasing the net proceeds from $500m to $275m.
Additionally, Spirit will also acquire Short Brothers, an aerospace company and make a $130m special contribution to the pension scheme of Short Brothers.
Spirit is advised by Goldman Sachs, Morgan Stanley and Sullivan & Cromwell. Bombardier is advised by Credit Suisse.
The Carlyle Group agreed to acquire Calastone, a global funds network, from investment firms Accel and Octopus Ventures. Financial terms were not disclosed.
"We are delighted to partner with Julien and the management team and look forward to leveraging our global platform, network of relationships, and deep expertise in Financial Services and Technology to support Calastone in its next phase of growth," Fernando Chueca, The Carlyle Group Managing Director.
Calastone is advised by Barclays and FTI Consulting.
Institutional investors completed the acquisition of Adven Group, a provider of energy solutions and district heating, from Infracapital and AMP Capital, two private equity firms. Financial terms were not disclosed.
“The open-end structure and long-term investment horizon match very well with our long-dated customer contracts and relationships. Our investors said that they are delighted to invest in Adven, a platform that significantly enhances scale and capability in the region alongside their ownership of Värmevärden. I want to thank AMP Capital and Infracapital Teams as well as all board members for great cooperation and valuable support in recent years,” Jyrki Vainionpää, Adven Group CEO.
Institutional investors were advised by JP Morgan and DC Advisory.
EQT to sell Apleona. (FS)
Buyout group EQT has kicked off the sale of facilities manager Apleona, previously part of industrial services group Bilfinger, for up to $2.4bn, Reuters reported.
EQT, which is working with Deutsche Bank on the sale, last week sent out first information packages to prospective buyers such as CBRE, Cushman & Wakefield and Jones Lang Lasalle, as well as private equity groups.
A stock market listing in summer 2021, organised by Deutsche Bank and UBS, is also being considered.
IPR to acquire $236m worth of Egypt assets from Dana Gas.
Dana Gas, a natural gas company, agreed to sell its Egyptian oil and gas fields for as much as $236m, enabling it to repay debt associated with Islamic bonds that mature this month, Bloomberg reported.
The company, based in the United Arab Emirates, will receive $153m in cash and as much as $83m in contingent payments for the sale to IPR Energy Group. Dana Gas also will take an impairment charge in the third quarter related to the coronavirus pandemic’s impact on its overall business.
Al Mal Capital plans Dubai's IPO. (FS, RE)
Al Mal Capital plans to sell shares in its real estate investment trust in January, looking to draw a line on Dubai's property slump and setting the stage for the first IPO in the emirate since 2017, Bloomberg reported.
The company has received regulatory approval to list Al Mal Capital REIT on Dubai Financial Market. It’s targeting an offer size of AED500m ($136m) to acquire a diversified portfolio of assets in real estate and sectors such as health care and education.
"This drop in real estate is creating an opportunity for lower inflation, better income and more creativity of getting new businesses. The real estate market here is very volatile, and we understand that, but again the infrastructure has been built extremely well," Naser Al Nabulsi, Al Mal Capital Vice-Chairman and CEO.
APAC
Coca-Cola European Partners, a British multinational bottling company dedicated to the marketing, production, and distribution of Coca-Cola products, offered to acquire Coca-Cola Amatil, a bottler and distributor of ready-to-drink non-alcoholic and alcoholic beverages and coffee in the Asia Pacific region, for $6.6bn.
The proposed transaction would create a broader and more balanced footprint for CCEP whilst almost doubling CCEP's consumer reach, with the aim of ultimately driving sustainable and faster growth, through geographic diversification and scale.
CCEC is advised by Credit Suisse, Rothschild & Co, Corrs Chambers Westgarth, Slaughter & May, Citadel Magnus and Portland Communications.
The Singapore International Arbitration Centre granted an emergency interim order in Amazon’s favour, after the US tech group filed a complaint connected to a $3.4bn deal that Reliance struck with Future Group in August, FT reported.
Amazon, which acquired an indirect minority stake in the retail and fashion conglomerate last year, alleged that Future's sale of its retail, wholesale, logistics and warehousing businesses to Reliance breached its pre-existing contract, which included a right of first offer and a non-compete clause. The deal is now on hold until a final decision is given.
Alibaba-backed Ant Group set to raise more than $34bn in record IPO.
Alibaba-backed Ant Group is set to raise more than $34bn after setting the price of shares in its initial public offering, putting the Chinese payments group on track to top Saudi Aramco as the biggest-ever market listing, FT reported.
The financial technology company, controlled by Alibaba’s billionaire founder Jack Ma, will sell shares in a dual listing across Shanghai and Hong Kong. It is expected to make its market debut on November 5.
Ant said it would sell shares for the Shanghai portion, which will trade on the technology-focused Star market, at Rmb68.80 ($10.26) each. Ant also said it had set the price for its Hong Kong shares at HK$80 (US$10.32).
Google, Temasek agree to invest $350m in Tokopedia. (FS)
Google and Temasek Holdings have agreed to invest about $350m in PT Tokopedia, a major cash infusion that will bankroll the Indonesian online mall’s post-Covid-19 expansion, Bloomberg reported.
The Alphabet unit and Singapore’s state investment firm could sign an agreement for the funding soon. The financing falls short of the initial goal of between $500m to $1bn though Tokopedia may still be looking for more investors.
ByteDance in early talks to list Douyin in Hong Kong.
ByteDance, a TikTok-owner, is in discussions internally and with investment banks to list its Douyin, a Chinese short video app, in Hong Kong, Reuters reported.
ByteDance has discussed internally about the potential scenario, and its representatives have met several investment banks in recent weeks to talk about such a possibility for Douyin. TikTok is not available in China, and Douyin is TikTok's Chinese counterpart.
Warburg Pincus considers divesting a stake in CleanMax. (FS)
Warburg Pincus, a global private equity firm, is exploring stake sale in CleanMax. The other investors in the firm are International Finance and UK Climate Investments, a joint venture between Green Investment Group and the UK government's department for business, energy and industrial strategy.
In July 2017, Warburg Pincus had announced that it will invest up to $100m in CleanMax. CleanMax’s operating capacity has grown from 24MW in 2015-16 to more than 500MW in 2018-19, and the company expects to expand its customer base from 120 corporates to 300 corporates by 2022. It has expanded its portfolio in West Asia and is exploring further expansion in South-East Asian countries.
Advantage Partners considers investing in ANA-backed Star Flyer. (FS)
Advantage Partners, a Japanese fund, is looking to invest in Star Flyer, a domestic airline, offering much-needed funding amid a slump in air travel, Reuters reported.
Star Flyer is planning a third-party allocation of new shares to raise about JPY10bn ($95m). Advantage Partners is looking to take part, on condition that existing shareholders also participate.
ANA Holdings, Star Flyer's biggest shareholder with an 18% stake, expects a net loss of around JPY500bn ($4.8bn) for the year to March, and is eyeing cuts to both jobs and its aircraft fleet.
Gaorong Capital raised $1.5bn for its USD- and RMB-denominated funds. (FS)
Gaorong Capital, a Beijing-based venture capital firm focused on early- and growth-stage investments, has closed two funds — a new RMB-denominated fund and its fifth USD fund — at over CNY10bn ($1.5bn).
The new funds bring the assets under management of Gaorong to nearly CNY28bn ($4bn). The company claims the USD fund, comprising a $1bn main fund and $150m side fund, is the largest USD fundraised by a Chinese VC. Its limited partners are from sovereign wealth funds, charity foundations, endowment funds, and funds of funds.
The investors in the RMB fund include insurance groups, university endowments, large-sized enterprises, FOFs, and individual entrepreneurs. Going forward, Gaorong will continue to invest in new consumption, new technology, corporate services, and healthcare technology.
Nomura considers hiring M&A bankers as Japan deals surge during a pandemic. (FS, People)
Nomura is hiring bankers for its M&A business in Japan as a sharp rebound in domestic deal-making vaults the nation's biggest securities firm to the top ranks of global advisers, Bloomberg reported.
"We are recruiting people more eagerly than usual. Consultations on local deals are up about 30% to 40% from a normal year, with clients seeking advice on every kind of transaction during the pandemic," Shunichi Tsunoda, Nomura Global M&A head.
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