Daily Review

 

In response to the £1.3bn ($1.7bn) offer for Provident Financial made by Non-Standard Finance on Feb. 22, the board of Provident expressed its disappointment at the unsolicited and highly opportunistic approach and NSF’s decision not to engage with the board prior to the announcement. The unsolicited bid is led by John van Kuffeler, former CEO of Provident for 22 years.

"This transaction will create a market leader in the non-standard finance sector with a strong position in all four main segments. We have recognized the strong logic and value creation potential of a combination with Provident for some time and hence approached the Provident Board with a proposal in January last year." said John van Kuffeler, NSF founder and Chief Executive.

Provident Financial is advised by Barclays, JP Morgan, and Brunswick Group. Non-Standard Finance is advised by Shore Capital & Corporate, Deutsche Bank, Ondra Partners, Slaughter & May, and Maitland.

 

The Weir Group agreed to sell its Flow Control division to First Reserve, a leading global private equity investment firm focused exclusively on energy, for an enterprise value of £275m ($358m), payable in cash and subject to customary working capital and debt-like adjustments at closing. The transaction remains subject to certain regulatory and other approvals, with completion expected in Q2 2019.

Flow Control primarily provides highly engineered pumps, valves and other solutions used in power, industrial and downstream oil and gas applications. The plan to sell the division was first announced on 19 April 2018 alongside the Weir's acquisition of ESCO, which further strengthened Weir's leadership position in global mining markets. Once this transaction completes, on a pro forma basis, more than 80% of Weir's revenues will be from attractive aftermarket-intensive mining and upstream oil and gas markets.

Jeff Quake and Neil Hartley, Managing Directors of First Reserve, commented: "First Reserve has deep historical experience creating value for our investors in the flow control space, and we are pleased to partner with Weir in this carve-out transaction. In our view, Weir Flow Control represents an attractive growth platform in a fragmented sector, with internationally recognized brands driven by recurring high-margin aftermarket parts and services which have proven to be resilient through multiple economic environments. We look forward to supporting David Paradis and his talented management team to promote both organic growth and acquisitive expansion of the platform as we seek to drive value on behalf of our investors."

Joele Frank advised First Reserve. Goldman Sachs, Herbert Smith and Brunswick Group advised Weir Group.

 

RockRose Energy, the independent oil and gas company, acquired the UK unit of Marathon Oil, an American petroleum and natural gas exploration and production company headquartered in the Marathon Oil Tower in Houston, for $140m. The deal gives RockRose 37-40% operated interests in the Greater Brae Area, a 28% stake in the BP-operated Foinaven field, and 47% of Foinaven East.

RockRose Executive Chairman, Andrew Austin said: "This acquisition marks a major step change in the Group's reserves and production profile. Given the quality of these assets the Board's view is this is a good opportunity to make the transition to the role of operator. We look forward to welcoming  Marathon Oil UK employees, who have an excellent track record operating in the North Sea, to the RockRose team at closing."

Hannam Partners, Cantor Fitzgerald and Celicourt advised RockRose Energy.

 

Ericsson, a Swedish multinational networking and telecommunications company, acquired the antenna and filters business of Kathrein, a world-leading provider of antenna and filter technologies. Financial terms were not disclosed.

Fredrik Jejdling, Executive Vice President and Head of Business Area Networks, Ericsson, said: “Strengthening our in-house antenna competence is another important step in our Networks portfolio strategy. The acquisition of Kathrein’s antenna and filters business will expand our capabilities and competencies in the advanced active and passive antenna domain further. With the additional focus on the antenna and filter business led by Kathrein professionals, we will broaden our offering to further optimize site space, which is vital for the introduction of 5G.”

Rothschild & Co advised Kathrein.

 

KKR acquired Universum Film, a Munich-based company that acquires and co-produces feature film and series rights in all genres on the national and international markets and exploits them in cinemas and home entertainment, from Mediengruppe RTL Deutschland, a media company in Cologne, Germany. Universum becomes the second company within KKR's new independent audio-visual content platform in Germany. The platform was created by KKR through its recent acquisition of Tele München Gruppe, the largest independent media company in Germany which combines all parts of the value chain for audio-visual content across platforms. Financial terms were not disclosed.

“I am proud that we have come one step closer to realizing our vision of creating something truly new and unique in the German entertainment industry. Universum ideally complements our platform, delivering tailor-made content to viewers through cinemas and homes. The extensive experience, as well as marketing and sales expertise of Universum’s employees, will help drive the future success of the platform. With Universum and TMG, the platform is already one of the best in the industry in many areas. We want to build on these strengths and drive its growth further,” said Philipp Freise, Member and Head of the European Technology, Media and Telecommunications Industry team at KKR.

 

JBM Group, the $1.5bn conglomerate with business interest in auto systems and assemblies, acquired German vehicle parts manufacturer Linde-Wiemann, a leading manufacturer of complex structural components & assemblies to automotive OEM's worldwide. Financial terms were not disclosed.

 

Speaking on the acquisition, Mr. Nishant Arya, Executive Director, JBM Group said: "This business activity is a strategic fit perfectly in sync with our existing scope of operations & solutions and will also further consolidate our global footprint. Both entities together will bring forward an impeccable combination of frugal engineering & world class technology. We are looking forward to leveraging L+W's experience in Europe coupled with our expertise in the auto component domain. JBM and L+W will together focus on developing new products that contribute towards improving the safety and performance of vehicles through light-weighting, thereby increasing the product quality and minimizing the time to market for OEMs, making it an integrated one-stop solution".

ICICI Bank advised JBM and provided debt financing.

 

Vivendi, a French mass media conglomerate and largest shareholder of Telecom Italia, said on Sunday it would back a merger of the fixed-line networks of TIM and rival Open Fiber if conditions were right. Simultaneously Vivendi attacked another Telecom Italia stakeholder, Elliott Management Corporation, which owns a 10% stake. Elliott is battling with Vivendi over how to re-launch the firm after wresting control of its board from the French media giant.

Vivendi said Telecom Italia’s fixed network was core to value creation, adding it would support a merger of Open Fiber with Telecom Italia if conditions were right from an operational, financial and regulatory standpoint and overseen by an independent board.

“Any potential decisions involving its ‘crown jewel’ assets must be taken with the utmost care and consideration,” it said.

The future of Telecom Italia’s fixed network has been a bone of contention between the two investors with Elliott pushing for a merger and Vivendi reluctant to lose control. Telecom Italia’s shares have lost more than 30% since March last year, partially due to the governance battle between its top two shareholders.

 

Danaher Corporation, a global science and technology innovator, acquired the biopharma business of General Electric, an American multinational conglomerate, for $21bn. GE Biopharma is a leading provider of instruments, consumables, and software that support the research, discovery, process development and manufacturing workflows of biopharmaceutical drugs. The business is comprised of process chromatography hardware and consumables, cell culture media, single-use technologies, development instrumentation and consumables, and service.

Danaher's President and CEO, Thomas P. Joyce, Jr., said: "GE Biopharma is renowned for providing best-in-class bioprocessing technologies and solutions. This acquisition will bring a talented and passionate team as well as a highly innovative, industry-leading product suite to our Life Sciences portfolio, providing an excellent complement to our current biologics workflow solutions."

PJT Partners, JP Morgan, Goldman Sachs, Citigroup and Paul Weiss Rifkind Wharton & Garrison advised General Electric. Kirkland & Ellis advised Danaher.

 

Barrick Gold, the largest gold mining company in the world, made an $18bn offer for Newmont Mining, an American mining company. The proposal is for a merger in which each Newmont shareholder would receive 2.5694 Barrick shares per Newmont share. Barrick shareholders would own approximately 55.9% of the merged company and Newmont shareholders would own approximately 44.1%.

Barrick President and CEO Mark Bristow said the proposed merger is expected to unlock more than $7bn net present value of real synergies, a major portion of which is generated by combining the two companies’ highly complementary assets in Nevada, including Barrick’s significant mineral endowments and Newmont’s processing plants and infrastructure.

“The combination of Barrick and Newmont will create what is clearly the world’s best gold company, with the largest portfolio of Tier One gold assets and the highest level of free cash flow to drive future growth and support sustainable shareholder returns, run by a management team with an unparalleled record of delivering value,” he said.

CIBC, M. Klein, Cravath Swaine & Moore and Davies Ward Phillips & Vineberg advised Barrick Gold Corporation. BMO Capital Markets, Citigroup, Goldman Sachs, Goodmans, Wachtell Lipton Rosen & Katz and White & Case advised Newmont.

 

Roche, a global pioneer in pharmaceuticals and diagnostics, acquired Spark Therapeutics, a fully integrated, commercial gene therapy company dedicated to challenging the inevitability of genetic disease, for $4.8bn. Under the terms of the agreement, Roche will acquire Spark Therapeutics at a price of $114.50 per share. The per share price represents a premium of 122% to Spark’s closing price on Feb. 22, 2019. The merger agreement has been unanimously approved by the boards of both Spark and Roche.

“As the only biotechnology company that has successfully commercialized a gene therapy for a genetic disease in the U.S., we have built unmatched competencies in the discovery, development and delivery of genetic medicines. However, the needs of patients and families living with genetic diseases are immediate and vast,” said Jeffrey D. Marrazzo, chief executive officer of Spark Therapeutics. “With its worldwide reach and extensive resources, Roche will help us accelerate the development of more gene therapies for more patients for more diseases and further expedite our vision of a world where no life is limited by genetic disease.”

Centerview Partners, Cowen and Goodwin Procter advised Spark Therapeutics. Citigroup and Davis Polk & Wardwell advised Roche.

 

Platinum Equity acquired Multi-Color Corporation, a leader in global label solutions supporting a number of the world’s most prominent brands including leading producers of home and personal care, wine and spirits, food and beverage, healthcare and specialty consumer products, for $50 in cash for each share of MCC, in a transaction valued at $2.5bn including the assumption of $1.5bn of debt. The purchase price represents a premium of approximately 32% over Multi-Color Corporation’s 30-day volume weighted average share price.

“We are pleased to reach this agreement with an affiliate of Platinum Equity,” said Nigel Vinecombe, Executive Chairman of Multi-Color Corporation. “This transaction is the culmination of our Board’s review of strategic alternatives to maximize value for our shareholders. As a result of this process, our Board, with the assistance of independent advisors, unanimously determined that this all-cash transaction will deliver immediate, significant and certain value to our shareholders and is in the best interest of our shareholders and our company. We believe this transaction represents a winning proposition for all of our stakeholders, including our employees.”

Goldman Sachs, William Blair, Sidley Austin and Keating Muething & Klekamp advised Multi-Color Corporation. Sullivan & Cromwell advised Goldman Sachs. Latham & Watkins advised Platinum Equity. Deutsche Bank and Bank of America Merrill Lynch provided debt financing and were advised by Cahill Gordon & Reindel.

 

Funds advised by Triton Partners and a wholly-owned subsidiary of the Abu Dhabi Investment Authority acquired IFCO, the leading global provider of reusable packaging solutions for fresh foods, from Brambles, an Australian company that specializes in the pooling of unit-load equipment and associated services, for $2.5bn.

Peder Prahl, Director of the General Partner for the Triton funds, said: "We look forward to actively supporting the management and employees of IFCO as a stable owner by investing in the growth and development of the company. Our strong industry expertise, gained through other investments and strengthened by senior industry experts, will contribute in taking the company to the next level.”

Rothschild & Co advised Brambles. Latham & Watkins advised Triton Partners.

 

Ipsen, a French pharmaceutical company headquartered in Paris, acquired Clementia Pharmaceuticals, a clinical-stage company innovating treatments for people with ultra-rare bone disorders and other diseases with high medical need, for $1.3bn. Under the terms of the agreement, Ipsen will pay $25 per share in cash upfront on completion of the transaction, for an initial aggregate consideration of $1.04bn, plus deferred payments on the achievement of a future regulatory milestone in the form of a contingent value right of $6 per share upon FDA acceptance of the NDA filing for palovarotene for the treatment of MO, representing an additional potential payment of $263m. The initial cash consideration represents a premium of 77% to Clementia’s 30-day volume-weighted average stock price.

David Meek, Chief Executive Officer of Ipsen, commented: “The acquisition of Clementia Pharmaceuticals accelerates the ongoing transformation of Ipsen as we are successfully executing on our external innovation strategy to identify and acquire innovative medicines to serve patients with unmet medical needs. Through this transaction, we will gain scientific expertise, exceptional talent, and a cornerstone ultra-rare disease drug candidate with rare pediatric disease and breakthrough therapy designations, potential U.S. approval in 2020 and additional indications to follow. We look forward to working closely with Clementia to successfully integrate two companies that share a similar patient-centric culture and the ambition to deliver new treatments to patients with unmet medical needs.”

Centerview Partners, Goodwin Procter and Davies Ward Phillips & Vineberg advised Ipsen. Morgan Stanley, Stikeman Elliott and Skadden Arps Slate Meagher & Flom advised Clementia Pharmaceuticals.

 

Private equity firm Quad-C Management agreed to sell its stake in Compassion-First, a family of well-known and respected specialty, emergency and general practice veterinary hospitals across the United States, to JAB Holdings, a privately held German conglomerate, based on a total enterprise valuation of $1.2bn.

“We are pleased to invest behind John and the management team as Compassion-First continues to deliver industry-leading organic growth and execute on its long-term strategy,” said David Bell, Partner at JAB. “The dedication to being the best place for veterinarians to work, the absolute commitment to putting patients first and the continual focus on innovation to improve the lives of both pets and their families are values very much in line with the those at JAB, and we look forward to partnering with John and his team to further Compassion-First’s success.”

Jefferies and Gibson Dunn & Crutcher advised Compassion-First. Skadden Arps Slate Meagher & Flom advised JAB Holdings.

 

Warburg Pincus acquired a majority stake in Kestra Financial, a leading independent investment advisory services provider, from Stone Point Capital. Funds managed by Stone Point Capital and Kestra Financial’s management team will maintain a minority stake in the company. Financial terms were not disclosed. 

“We are thrilled to partner with James, the Kestra Financial team and Stone Point in the next chapter of Kestra Financial’s success. The company’s focus on providing best-in-class service and technology to its advisors and their clients positions the business for an exciting future,” said Arjun Thimmaya, Managing Director, Warburg Pincus. “We are committed to supporting Kestra Financial in their mission to build the leading wealth management platform to empower the success of their financial advisors,” added Jeff Stein, Managing Director, Warburg Pincus.

Goldman Sachs, Bank of America Merrill Lynch and Kramer Levin Naftalis & Frankel advised Kestra Financial. Kirkland & Ellis and Wachtell Lipton Rosen & Katz advised Warburg Pincus.

 

An investor group led by GTCR, a leading Chicago-based private equity firm, acquired AssuredPartners, a leading US insurance brokerage firm, from Apax Partners. The terms of the transaction were not disclosed.

Aaron Cohen, GTCR Managing Director, said: "We had an incredible experience working with the Assured team and have watched with admiration their continued success over the last three years. We want to congratulate the entire Assured organization on building a leading insurance broker with over $1bn of revenue in just eight years. AssuredPartners is a trusted advisor to its customers, offering unique capabilities to assist leading companies in all of their insurance and risk management needs. We are thrilled to be partners with Jim Henderson, Tom Riley and the team once again and look forward to the continued expansion of the AssuredPartners platform."

Bank of America Merrill Lynch, Kirkland & Ellis and Katten Muchin Rosenman advised AssuredPartners. Morgan Stanley and Latham & Watkins advised GTCR. Bank of America Merrill Lynch, Barclays, Harris Williams, Kirkland & Ellis and Simpson Thacher & Bartlett advised Apax.

 

 

 

 

 

Caesars Entertainment Corporation, an American gaming corporation based in Paradise, Nevada that owns and operates over 50 casinos and hotels, and seven golf courses under several brands, is in talks to offer Carl Icahn a role in selecting its new CEO as part of an agreement that would also give the billionaire investor board seats. The negotiations come after the investor disclosed a 9.8% stake in the company. 

Icahn has proposed Anthony Rodio, the CEO of privately held casino gaming company Affinity Gaming, as the successor to Mark Frissora, who is due to step down as Caesars CEO later this year. Rodio was previously CEO of Tropicana Entertainment, another casino and resort operator that Icahn sold last year to Eldorado Resorts for $1.8bn.

 

Kraft Heinz, an American food company formed by the merger of Kraft Foods and Heinz and partially owned by Brazil’s buyout fund 3G Capital and Warren Buffett’s Berkshire Hathaway, is seeking a sale of its Maxwell House coffee business. The unit has about $400m in EBITDA and could attract a price of at least $3bn in a sale.

“We will explore asset sales according to this framework and will engage if this alternative is superior to us keeping the business and helps to improve the company’s growth and margin trajectory,” said Kraft Heinz spokesman Michael Mullen in an email to Reuters on Sunday.

Warren Buffett, who entered the capital of the troubled food company in 2015, said on Monday that he was wrong about Kraft Heinz and that he overpaid for the company. Kraft Heinz’s share price drop of 27% on Friday cost Berkshire Hathaway to lose $4.3bn. Buffett also said he has “absolutely no intention” of adding to or subtracting from Berkshire’s stake.

Credit Suisse is advising Kraft Heinz on the sale.

 

Wind Point Partners is rumored to be looking to sell its portfolio company, Paragon Films, which manufactures and supplies stretch film products, for up to $500m. A final decision to pursue a sale hasn’t been made and Wind Point could decide to keep the company. The Chicago-based firm is currently working with an adviser to run an auction process for the company.

 

Colony Industrial, the industrial platform of Colony Capital, sold a light industrial portfolio to Nuveen Real Estate, a division of TIAA, the leading provider of financial services in the academic, research, medical, cultural and governmental fields, for $136m. The warehouse portfolio totals 2.3m square feet and is situated in four markets including eighteen buildings in Atlanta, five buildings in Dallas, five buildings in Houston and six buildings in Pennsylvania and New Jersey.

“We’ve owned and operated these assets for some time and the portfolio value had achieved Colony Industrial’s targets,” said Lew Friedland, Managing Director at Colony Capital and head of Colony Industrial. “We reevaluate the portfolio as opportunities arise, and this sale to Nuveen enables us to rebalance our property mix to align with Colony Industrial’s long-term strategic plans.”

CBRE National Partners advised Colony Industrial.

 

Genstar Capital, a leading private equity firm focused on investments in targeted segments of the financial services, software, industrial technology, and healthcare industries, announced the final closing of Genstar Capital Partners IX with $5.5bn in limited partner commitments. In addition, Genstar raised committed overage capacity of $1.1bn from select limited partners.

Commenting on the fundraising, Tony Salewski, Managing Director at Genstar, said: “We appreciate the tremendous support from our existing limited partners and the expansion of our base among leading global investors. The focus of this group allowed us to move quickly to close Fund IX within 15 weeks of the fund launch. We believe that our thesis-driven investing model of growing and building industry-leading businesses will continue to deliver superior performance for our investors.”

Evercore Partners served as Placement Agent for the fund, and Weil, Gotshal & Manges LLP provided legal advice.

 

SK Capital Partners, a private investment firm focused on the specialty materials, chemicals and pharmaceuticals sectors, announced the final close of SK Capital Partners Fund V with total committed capital of approximately $2.1bn. Fund V includes a separate overage fund that will enable the firm to provide greater speed and certainty to sellers when it pursues larger transactions.

“We are pleased by the tremendous demand for Fund V. Both the quality and diversity of our limited partners is indicative of their broad support for SK Capital’s disciplined strategy and strong team that incorporates both deep industry experience and diverse operating skill sets to deliver our targeted returns,” said Barry Siadat, Co-Founder and Managing Director of SK Capital Partners.

Kirkland & Ellis LLP served as legal advisor and UBS served as placement agent to SK Capital.

 

San Francisco-based DoorDash, an on-demand food service, raised $400m in Series F funding. Temasek and Dragoneer Investment Group led the round with participation from return backers Softbank Vision Fund, DST Global, Coatue Management, GIC, Sequoia Capital and Y Combinator. The investment values the company at $7.1bn.