AMERICAS
A Delaware judge ruled this week that former Viacom shareholders may pursue a lawsuit accusing Shari Redstone of engineering a “patently unfair” merger that created ViacomCBS so she could become a media magnate like her late father, Sumner Redstone, Reuters reported.
Vice Chancellor Joseph Slights of the Delaware Chancery Court said it was reasonable to infer from the plaintiffs’ claims that the December 2019 merger was “not entirely fair,” and that Redstone used it “to consolidate her control of Viacom and CBS at the expense of the Viacom minority stockholders.”
Shari Redstone’s National Amusements had controlled about 80% of the voting power of both Viacom and CBS, despite owning about 10% of the respective shares.
Viacom was advised by LionTree Advisors, Morgan Stanley, Cravath Swaine & Moore, Shearman & Sterling, Community Group, and Finsbury Glover Hering. Financial advisors were advised by Latham & Watkins. CBS was advised by Centerview Partners, Evercore, Goldman Sachs, JP Morgan, Lazard, Moelis & Co, Hughes Hubbard & Reed, Jones Day, and Paul Weiss Rifkind Wharton & Garrison. National Amusement was advised by Evercore and Cleary Gottlieb Steen & Hamilton.
Thoma Bravo, a private equity investment firm focused on the software and technology-enabled services sector, completed an investment in Venafi, a privately held cybersecurity company that develops software to secure and protect cryptographic keys and digital certificates, at a $1.15bn valuation.
“We are thrilled to partner with Thoma Bravo at a time when companies around the world are realizing that the foundation of security for all digital transformation initiatives is a solid machine identity management program. Thoma Bravo’s strategic investment will allow us to build on this momentum and deliver machine identity protection solutions to an expanded customer base, while continuing to drive product innovation and growth," Jeff Hudson, Venafi CEO.
Venafi was advised by JP Morgan and Orrick Herrington & Sutcliffe. Thoma Bravo was advised by Barclays, Nomura, Truist Bank, Kirkland & Ellis, and Finsbury Glover Hering. Debt financing was provided by Barclays, Nomura, and Truist Bank.
Devon Energy and WPX Energy, announced the shareholders of both companies voted in favor of all proposals necessary for the closing of the previously announced all-stock merger of equals between Devon and WPX. The merger is anticipated to close on January 7, 2021.
“We are pleased with the strong support we received from both companies’ shareholders. This is an important milestone as we move toward uniting our complementary assets to create a leading US energy company, with a focus on accelerating free cash flow growth and the return of capital to shareholders," Dave Hager, Devon President and CEO.
WPX Energy is advised by Citigroup, Kirkland & Ellis, and Brunswick Group. Citigroup is advised by White & Case. Devon Energy is advised by JP Morgan, Skadden Arps Slate Meagher & Flom, and Joele Frank. JP Morgan is advised by Cravath Swaine & Moore. EnCap Investments is advised by Vinson & Elkins.
New York Life, America's largest mutual life insurer, completed the acquisition of the group life and disability insurance business of Cigna, a global health service company, for $6.3bn.
"This acquisition, the largest in our company’s history, reinforces our financial strength by generating capital that can contribute to our surplus, dividends, and earnings. We are excited to welcome to New York Life our new employees and the millions of new customer relationships that we will gain through this milestone transaction. We look forward to building on our leading group benefit solutions market position in the years ahead," Ted Mathas, New York Life Chairman and CEO.
New York Life was advised by Credit Suisse, Debevoise & Plimpton, and Sloane & Company. Credit Suisse was advised by Sullivan & Cromwell. Cigna was advised by Bank of America Merrill Lynch, Paul Weiss Rifkind Wharton & Garrison, Sidley Austin, and Wachtell Lipton Rosen & Katz.
Private equity firm Clearlake Capital Group completed the acquisition of PrimeSource, a global distributor of specialty building materials, from Platinum Equity. Financial terms were not disclosed.
"PrimeSource showcased the breadth of our M&A&O toolkit and the ways Platinum creates value throughout the entire lifecycle of an investment. We started by providing a divestiture solution to a large corporate seller, then executed a comprehensive transition and transformation program that established PrimeSource as a solid platform for growth as an independent company. The business thrived under our stewardship, to the benefit of its customers, suppliers, employees and their communities," Jacob Kotzubei, Platinum Equity Partner.
Clearlake Capital was advised by Deutsche Bank, Stikeman Elliott, Lambert & Co and Kirkland & Ellis. Platinum Equity was advised by Moelis & Co and Gibson Dunn & Crutcher.
Golden Gate Capital, a private equity firm, and Scott Blackstock, the CEO of Tidal Wave, completed the acquisition of a minority stake in Tidal Wave Auto Spa, a premium conveyor car wash services provider. Financial terms were not disclosed.
"We have tremendous respect for Scott and the amazing and innovative Tidal Wave management team, who have consistently delivered outstanding quality and growth. We look forward to working together to accelerate the Company’s trajectory through organic growth at existing sites, aggressive new unit expansion and an enhanced acquisition program," Neale Attenborough, Golden Gate Capital Operating Partner.
Tidal Wave was advised by JP Morgan and Troutman Pepper. Golden Gate Capital was advised by Nob Hill, Ropes & Gray, and Sard Verbinnen & Co.
Central Garden & Pet, a gardening products and pet products provider, agreed to acquire Green Garden Products, a supplier of branded consumable gardening products, from Freeman Spogli, a private equity firm, for $532m. The transaction is expected to close in the second quarter of fiscal 2021, subject to customary closing conditions, including regulatory approval.
"As a company that has historically focused on the early season gardener, we feel that this combination can now provide an opportunity to deliver new products and experiences throughout the entire journey of the gardener. In addition, this transaction is a testament to the outstanding work of our associates and our management team, and an acknowledgement of the excellent partnerships that we have established with our retail customers, suppliers, and Freeman Spogli, who, in particular, has been an excellent and very supportive partner over the last six years," Michael Pietrasiewicz, Green Garden Products President and CEO.
Green Garden Products is advised by BlackArch Partners, William Blair and Morgan Lewis & Bockius. Central Garden & Pet is advised by Orrick Herrington & Sutcliffe.
HelloFresh, a provider of meal kits, completed the acquisition of Factor75, a provider of fully-prepared, fresh meals, for $277m.
"Direct-to-consumer ready-to-eat meals are a nascent food vertical that we believe has the potential to grow into a multi-billion dollar category over time. With Factor, HelloFresh, EveryPlate and Green Chef, we have four high-growth food brands in our Group, all benefiting from our strong growth engine, technology and supply chain infrastructure," Uwe Voss, HelloFresh US CEO.
Factor75 was advised by Rothschild & Co and Kirkland & Ellis. HelloFresh was advised by Sullivan & Cromwell.
The Jordan Company-backed iNRCORE, a manufacturer of magnetic components, completed the acquisition of Gowanda Components Group, an electronics components manufacturer, from Addison Capital Partners, a private equity firm. Financial terms were not disclosed.
"iNRCORE and Gowanda are both engineering, customer and culturally-focused businesses. Bringing the two businesses together will result in a more comprehensive set of solutions for our customers. We look forward to supporting Sarah Harris and the iNRCORE and Gowanda teams alongside Addison Capital," Erik Fagan, The Jordan Company Partner.
The Jordan Company was advised by Kirkland & Ellis. Addison Capital was advised by Akerman and Stearns Weaver Miller Weissler Alhadeff & Sitterson.
Alden Global Capital, a private equity firm, offered to acquire Tribune Publishing, the publisher of the New York Daily News, for $520m.
"We believe that, as a private company, Tribune would be able to unlock significant strategic and financial value, thereby allowing us to make an offer to acquire all of the common stock of Tribune not already owned by Alden," Alden Global Capital.
Tribune Publishing is advised by Lazard and Davis Polk & Wardwell.
Amazon, an American multinational technology company, agreed to acquire Wondery, an American podcast network, for $300m.
"Wondery is already delighting listeners with its collection of immersive podcasts, and the company is evolving this entertainment medium into a truly new and exciting experience. When the deal closes, nothing will change for listeners, and they’ll continue to be able to access Wondery podcasts through a variety of providers. With Amazon Music, Wondery will be able to provide even more high-quality, innovative content and continue their mission of bringing a world of entertainment and knowledge to their audiences, wherever they listen," Wondery.
Wondery is advised by LionTree Advisors.
Accel-KKR-backed OrthoFi, a software and technology-enabled service platform in the Orthodontic specialty industry. agreed to acquire OrthoBanc, an orthodontic patient financial management company. Financial terms were not disclosed.
"OrthoFi's mission has always been to help orthodontic practices Start More Smiles and to simplify their lives. We are thrilled to work with OrthoBanc, and to leverage their legacy of trusted payment solutions and industry-recognized customer service. I am excited and honored to lead this team of talented individuals. Our collective product offerings and our customer-centric cultures are an ideal fit, and will undoubtedly enhance the experience of the customers we serve," Dave Ternan, OrthoFi CEO.
OrthoFi is advised by Lincoln International.
Sandvik, a Swedish multinational engineering company, completed the acquisition of CGTech, a software development company. Financial terms were not disclosed.
"This is in line with our strategic focus to grow organically and through acquisitions in the digital manufacturing space, with special focus on software solutions close to machining," Stefan Widing, Sandvik President and CEO.
CGTech was advised by Houlihan Lokey.
Approved Oil, the largest family-owned oil company in New York City, completed the acquisition of the heating oil and service division of Original Energy, a provider of heating oil and mechanical services to commercial and residential customers. Financial terms were not disclosed.
"This acquisition is in-line with Approved's strategy to increase market share throughout New York's Metropolitan area. We look forward to working with Jim Slattery and the rest of Original's sales team to help onboard their customers into the Approved family of service," Chris Fazio, Approved Oil Executive Vice President.
Actriv, a healthcare staffing company, agreed to merge with Action Healthcare Staffing, a healthcare staffing company. Financial terms were not disclosed.
"We are excited about the opportunities the merger will create for our customers and the Healthcare Industry, as well as our employees and the stakeholders. Together, Action Healthcare and Actriv Inc will be able to scale rapidly while delivering the best in class and most innovative Healthcare Workforce Solutions," Allan Njoroge, Actriv Chairman and CEO.
Broadside Enterprises, a media acquisition and development company, completed the takeover of MonteCristo International Entertainment, a media distribution company. Financial terms were not disclosed.
"After 15 years of attending all markets and most festivals, and reaching over 100 feature films under management, MonteCristo is responding to the deep transformation of the sales agency business brought about both by new technology and Covid, with a renewed commitment to producers worldwide," Michael Taverna, Broadside Enterprises CEO.
Hart Medical Equipment, a supplier and distributor of home medical supplies and equipment, completed the acquisition of McLaren Home Medical Equipment, a medical equipment distributor. Financial terms were not disclosed.
"Hart concentrates on patient outcomes, integrative technologies, timely delivery, and customer satisfaction, which has helped build trust within our communities. We look forward to bringing Hart's focus on continuity of care, reduced readmissions, and long-term patient outcomes to the northern Michigan community," Allen Hunt, Hart President.
TMS International, a steelmaker, completed the acquisition of Stein, a steel mill processing services provider. Financial terms were not disclosed.
"Stein has a long and distinguished history in our industry and nicely complements our existing services that we provide to world class steelmakers throughout the US. This acquisition is an excellent fit with our company and meaningfully strengthens our US footprint and will provide a breadth and depth of resources and talent to us," Raymond Kalouche, TMS President and CEO.
Penske Logistics, a provider of logistics services and solutions, completed the acquisition of Black Horse Carriers, a Chicago-based trucking company. The parties involved anticipate closing the transaction on December 31, 2020. Financial terms were not disclosed.
"We are pleased to have completed the acquisition and we now look forward to our work together as one team in the coming year. We remain focused on delivering exceptional customer service as we integrate this business into our existing dedicated contract carriage operations," Marc Althen, Penske Logistics President.
Itaú calls shareholder meeting to decide XP stake spinoff.
Itaú Unibanco, Brazil’s largest lender by market value, has convened an extraordinary shareholder meeting on January 31 to decide on spinning off its 40.5% stake in brokerage XP, Reuters reported.
Itaú said last month that the new company would be directly owned by the bank’s shareholders. Itaú raised at least $956.4m by selling a 4.4% stake in XP in a share offering on December 3.
Itaú’s decision to divest in XP comes after its plans to take control of the major fintech group in 2017 were blocked for antitrust reasons two years later.
NYSE to delist China’s telecom operators.
The New York Stock Exchange will delist China’s three large telecom carriers, after a US government order barring Americans from investing in companies it says help the Chinese military, Wall Street Journal reported.
China Mobile - which is among the most valuable of China’s listed state-owned enterprises - will be kicked off the Big Board after more than two decades, along with China Telecom and China Unicom Hong Kong.
The NYSE decision is the latest setback for US investors in these companies, which rank among the largest global telecommunications providers but have largely lagged behind the broader markets since the companies began listing here more than two decades ago.
BlackRock scales back private equity fund ambitions. (FS)
BlackRock planned to shake up the private-equity world with a $12bn fund. Now the asset-management giant is setting its sights lower, Wall Street Journal reported.
BlackRock’s staffers conceded the target was unrealistic after struggling to meet fundraising goals. The firm’s staffers hope to grow the fund to between $4bn and $6bn in assets over time.
Best known for funds that track broad markets and trade on exchanges, BlackRock launched fundraising for a strategy in 2018 to make direct, long-term investments in private companies. The fund was an aggressive gambit to take on private equity’s big league deal makers.
EMEA
Fiat Chrysler Automobiles and PSA Group are poised to get shareholders’ sign-off on a combination that’s endured two years of extraordinary drama, marked by on-again off-again talks, the transformation of their industry and a global pandemic, Bloomberg reported.
At two separate meetings today, investors will be asked to approve a merger that will form Stellantis, the world’s fourth-largest automaker. The hurdles the two overcame to get to this point were plentiful and prodigious, with Fiat even managing to patch things up after a short-lived attempt to join forces with PSA’s archrival Renault.
Fiat Chrysler is advised by Bank of America Merrill Lynch, Barclays, Citigroup, Goldman Sachs, JP Morgan, UBS, d'Angelin & Co, Darrois Villey Maillot Brochier, De Brauw Blackstone Westbroek, Legance, Loyens & Loeff, Sullivan & Cromwell, Community Group, Image Sept, and Sard Verbinnen & Co. Financial advisors are advised by Cleary Gottlieb Steen & Hamilton and Macfarlanes. Bpifrance is advised by Willkie Farr & Gallagher. Peugeot Family is advised by Zaoui & Co. PSA Group is advised by China International Capital, Mediobanca, Messier Maris & Associes, Morgan Stanley, Perella Weinberg Partners, BonelliErede, Bredin Prat, Cabinet Bompoint, Clifford Chance, Cravath Swaine & Moore, Linklaters, NautaDutilh, and Stibbe. Exor is advised by Lazard.
Real estate agent Countrywide said it had agreed to Connells' sweetened buyout proposal after the realty management firm raised its offer for the second time, outbidding private equity firm Alchemy. The offer of $5.3 per share, revised from the initial proposal of $3.4 a share, gives the British company an enterprise value of about $304m, Reuters reported.
“We have been encouraged by their (Connells’) recognition of the need to put in place a sustainable capital structure and a willingness to support the company, which is a great business that has been constrained by too much debt,” David Watson, Countrywide Chairman.
Countrywide is advised by Barclays, Jefferies & Company, and Brunswick Group. Connells is advised by Evercore, Clifford Chance, and MHP Communications. Alchemy Partners is advised by Peel Hunt.
Caisse de dépôt et placement du Québec-backed Xebec Adsorption, a Canadian public provider of gas generation, completed the acquisition of HyGear Technology and Services, which distributes gases, for €82m (c.$127.3m).
“This is the boldest move in the company’s history, with the objective to make Xebec a worldwide renewable gas leader. We are also very happy to have the strategic support of the Caisse de dépôt et placement du Québec, a large long-term institutional investor who also shares the same vision. As a result, we are now uniquely positioned to leverage a recurring, profitable, and industrial client base to support our growth in renewable natural gas and hydrogen. I would like to congratulate everyone on all their hard work and give HyGear a warm welcome to the Xebec family,” Kurt Sorschak, Xebec Adsorption Chairman, CEO and President.
CDPQ is advised by Norton Rose Fulbright. Xebec Adsorption is advised by Desjardins, TD Securities, Osler Hoskin & Harcourt and Stikeman Elliott.
Generali, an insurance services provider, agreed to acquire Greek operations of AXA, an insurance brokerage firm, for $201m.
"This acquisition is fully aligned with the ‘Generali 2021’ strategy, which aims to strengthen our leadership in Europe. With the purchase of AXA Greece and the exclusive long-term distribution agreement with Alpha Bank, Generali decidedly strengthens its position in the local market, becoming the second largest group in the non-life and the third in the health sector in Greece. The transaction will enable us to optimize our strategic positioning in the country, allowing for a multi-channel, dynamic business and securing valuable, significant economies of scale for a more effective and efficient overall operation," Jaime Anchústegui Melgarejo, Generali CEO.
Generali is advised by Nomura and Kyriakides Georgopoulos.
ALK Capital, a private equity firm, completed the acquisition of an 84% stake in Burnley F.C., a professional football club, for $230m.
“Today marks a new era for Burnley as we become stewards of this historic football club and build on the impressive work that Mike Garlick, Sean Dyche and everyone at Burnley has done to make it a financially stable, established Premier League club that is a cornerstone of the local community. With a rich heritage, a brilliant academy, and a passionate fan base, this club has solid foundations to build upon. This is the start of an exciting journey for the entire Clarets family," Alan Pace, ALK Capital Chairman and Managing Partner.
Enghouse Systems, a Canadian publicly traded company, which provides enterprise software solutions focusing on remote work, visual computing and communications, agreed to acquire Altitude Software, a software technology provider in Portugal. Financial terms were not disclosed.
"Altitude expands our presence in Latin countries - primarily in Spain, Brazil, Mexico and now Portugal – enabling us to capture additional opportunities within these markets," Steve Sadler, Enghouse Chairman & CEO.
ENGIE under pressure as it embarks on slimming plan.
ENGIE ousted a chief executive, hired another, dramatically changed strategy and sold a €3.4bn ($4.1bn) stake in water and waste group SUEZ, kicking off a corporate fight that is still shaking the world of French business, FT reported
Now the company has to prove to investors it can turn itself round under a new leader as it shifts away from services to focus on energy infrastructure and renewable power - while making sure it does not become a takeover target in the process.
“We needed to tick the box on some big subjects like Suez. With these boxes ticked, quarter after quarter, we need to demonstrate that, indeed, growth is happening where we expect it to happen. Now it’s not just aspirational,“ Jean-Pierre Clamadieu, ENGIE Chairman.
Deutsche Bank CEO seeks key role in banking consolidation.
Deutsche Bank Chief Executive Officer Christian Sewing wants Germany’s largest lender to play an active role in a possible consolidation of Europe’s financial services industry, Bloomberg reported.
The performance of the Frankfurt-based bank has been steadily improving, and that’s why the company is not willing to be a junior partner if mergers and acquisitions are discussed.
“That’s also important for Germany. Being dependent on imports of financial services would be a strategic mistake,” Christian Sewing.
Sugar sweetens revolt against Caffe Nero rescue deal.
Lord Sugar, the Amstrad founder and star of The Apprentice, is fuelling a landlord-led revolt against a rescue deal for Caffe Nero, the struggling chain of coffee shops, SkyNews reported.
Amsprop Investments, the peer's private commercial property group, is among seven parties which have lodged a legal challenge aimed at blocking Caffe Nero's company voluntary arrangement.
Amsprop's involvement in the challenge, which is understood to have been filed on Christmas Eve, will intensify scrutiny of a restructuring that will affect the fate of thousands of high street workers.
APAC
Carrefour, a French multinational corporation specialized in retail, completed the acquisition of Wellcome Taiwan, a supermarket chain, from Dairy Farm, a Hong Kong retail company, for $108m.
“We have complete confidence in the future success of the business and believe, by bringing these businesses together, we have created a strong future for the team and a better shopping experience for our customers,” Laurent Piazza, Wellcome Taiwan Managing Director.
Wellcome Taiwan was advised by Lee and Li. Carrefour was advised by Clifford Chance, Deloitte, Tsar & Tsai and Brunswick Group. Dairy Farm was advised by HSBC.
Ford Motor said it was calling off its automotive joint venture with India's Mahindra and Mahindra due to the challenges caused by the Covid-19 pandemic.
The companies said in separate statements that the decision was driven by changes in the global economy over the last 15 months, causing both to reassess their capital allocation priorities.
“The global economy and business environment are not the same as October last year,” Ford.
Fosun International, a Chinese conglomerate and investment company, agreed to acquire a 70% stake in Sichuan Tuopai Shede Group, a brewery, from SkyOcean Holdings, a business conglomerate, for $694m.
The transaction underscores the domestic push underway at the insurance-to-tourism conglomerate as the Chinese economy rebounds from a pandemic-induced slowdown, even as western nations still struggle to contain the coronavirus outbreak.
PAG, an Asian private equity firm, led a c.$100m series C funding round in Shenzhen Pindao Restaurant Management, which operates as a a brand of freshly roasted tea drinks. Yunfeng Capital also participated in the round.
The bubble tea chain owner is considering an initial public offering in Hong Kong, after the coronavirus outbreak clouded its earlier plans for a US listing. Nayuki in February filed confidentially for an offering in the US.
Chinese regulators probe Ant Group's equity investments.
Chinese regulators are reviewing equity investments held by Ant Group in dozens of companies, Reuters reported.
Regulators are considering whether to instruct Ant to divest some of its investments, mainly in technology and fintech start-ups, if they violate any rules such as creating unfair competition in the market.
Any enforced divestments would deprive the group of potentially lucrative investments, compounding existing regulatory pressure to revamp its business structure and put up more capital for its key consumer lending business.
Indonesia says $9.8bn EV battery MOU agreed with LG Energy.
Indonesia and a unit of South Korean firm LG Group have signed a memorandum of understanding on a $9.8bn electric vehicle battery investment deal, Reuters reported.
The deal was signed on December 18 and includes investments across the EV supply chain, the board head, Bahlil Lahadalia said. An official at LG Energy Solution, a unit of LG Group, South Korea’s fourth-largest conglomerate, confirmed it had agreed an MOU.
Mahindra is in talks with investors to offload a majority of Ssangyong stake.
Mahindra Group is in discussions with an investor for selling a majority stake in Ssangyong Motor as India’s largest SUV maker reassesses its investments amid the pandemic, Bloomberg reported.
Mahindra will hold 30% or less in Ssangyong if the deal goes through and will also do a 25% capital reduction. It expects to sign the term sheet next week and will conclude the transaction by February 28. The company had purchased 70% stake in Ssangyong for $368m in 2010.
“Things have changed drastically in the last 12-15 months. With the kind of change that’s happening in business scenario and auto industry, we have to again re-prioritize where we put our money and where we put emphasis,” Pawan Kumar Goenka, Mahindra Managing Director.
KKR to float private InvIT in bid to house renewable assets.
Private equity firm KKR is setting up a private infrastructure investment trust to house operating renewable energy assets it aims to acquire in India.
InvITs manage income-generating infrastructure assets offering regular yield to investors and a liquid way to invest in infrastructure projects. They can be either publicly listed on stock exchanges or privately placed to a handful of investors.
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