Daily Review

Long-Term Asset Partners made a $2.4bn offer for GrainCorp. (FS)

Grab invested $100m in OYO.

Unilever signed an agreement to acquire the Health Food Drinks portfolio of GlaxoSmithKline in India, Bangladesh and 20 other predominantly Asian markets for €4.6bn ($5.2bn).

The transaction includes: the all-equity merger between Hindustan Unilever Ltd, Indian subsidiary of Unilever, and publicly listed GSK Consumer Healthcare India, which implies a total equity value of €3.96bn ($4.5bn); acquisition of 82% stake in GSK Bangladesh Limited at an equity value of €169m ($191m) and acquisition of certain other commercial operations and assets outside India for a total consideration of €470m ($531m) in cash. In 2018, the GSK HFD portfolio delivered a total turnover of €550m ($622m), primarily through the Horlicks and Boost brands. Almost 90% of the turnover is in India.

"The acquisition is transformative for our Foods and Refreshment business allowing us to enter the Health Foods Drinks category, further strengthening our position in health and wellness." Nitin Paranjpe, Unilever Food & Refreshment President.

Unilever was advised by Bank of America Merrill Lynch, Baker McKenzie and Cyril Amarchand Mangaldas. GSK was advised by Greenhill & Co, Morgan Stanley, Nova Dhruva Capital, AZB & Partners and Slaughter & May.

 

RPC Group Plc ended the takeover talks with Bain Capital, leaving Apollo Global Management in the lead to buy Europe’s biggest plastics packager. Apollo has time until Dec. 21 to make firm buyout offers or walk away, in the third extension of a deadline. Shares of London-listed RPC have gained about 5% since reports of merger talks emerged in September.

RPC Group was advised by Rothschild, Credit Suisse, Deutsche Bank, Evercore, Slaughter & May and Jefferies & Company.

 

American chipmaker Qualcomm Inc rejected a suggestion by the White House that its collapsed $44bn acquisition of Dutch peer NXP Semiconductors could be revived, saying the deal had been terminated as the deadline had expired. After high-stakes talks on Saturday between US President Donald Trump and Chinese President Xi Jinping in Argentina, the White House said that China was “open to approving the previously unapproved” deal for Qualcomm to acquire NXP “should it again be presented.”

“While we were grateful to learn of President Trump and President Xi’s comments about Qualcomm’s previously proposed acquisition of NXP, the deadline for that transaction has expired, which terminated the contemplated deal,” a Qualcomm representative told Reuters.

On the deal, Qualcomm was advised by Goldman Sachs, Allen & Overy and Sullivan & Cromwell.

 

Antonio Mexia, EDP’s CEO, said that some regulatory hurdles still need to be resolved before the deal completes. The $10bn takeover of EDP, one of Europe's major electricity operators, was first announced on May 12, 2018.

“It’s an inevitably long process because there are many countries, many authorizations involved, especially in the United States and Europe. So the results of the offer will be some time in 2019, certainly,” Mexia told reporters.

 

Fortum, an energy company focusing on the Nordic and Baltic countries, Poland, Russia and India, and the largest shareholder of Uniper, a German energy company, held talks with activist fund Elliott Management over how to gain control of Uniper. Fortum is growing increasingly frustrated over the slow pace of progress in discussions with Uniper regarding a cooperation agreement after it took a 47% stake this year. Uniper has opposed Fortum’s purchase of the stake.

Talks between Fortum and Elliott, Uniper’s second-largest shareholder with a 16.51% holding, also touched on possible conditions in which Fortum could buy Elliott’s stake.

Shares in Uniper rose as much as 5 % on the news.

 

Chip Wilson, the Canadian founder of yoga-apparel retailer Lululemon Athletica Inc, looks to join the group of Chinese investors, which pursues a takeover of Amer Sports, a Finnish headquartered sporting goods company with brands including Salomon, Wilson Sporting Goods, Atomic Skis, Arc’teryx, Mavic, Suunto, ENVE Composites, Peak Performance and Precor. He is rumored to be interested in acquiring a 20% stake.

The Chinese investor group is led by Anta Sports Products Ltd. Tencent is also rumored to be interested in joining the bid. In September Anta had teamed up with Chinese buyout firm FountainVest Partners to make an indicative offer valuing Amer at about €4.7bn ($5.3bn).

Shares of Amer climbed by the most in almost three months.

 

Anta Sports and FountainVest are being advised by Citigroup.

 

Reuters reported that Nestle’s Chairman Paul Bulcke said the stake in French cosmetics firm L’Oréal was “something active on the board’s agenda.” The company is currently under pressure from New York-based hedge fund Third Point, run by investor Daniel Loeb, to overhaul its business and sell its stake in L’Oréal.

Asked whether Nestle would consider allowing Third Point on its board, Bulcke declined to answer, the FT reported. “We are open to all ideas and then we judge what is best for the company,” he said.

 

 

GlaxoSmithKline, a global healthcare company, acquired TESARO, an oncology-focused company based in Waltham, Massachusetts, for $5.1bn. The acquisition price of $75 per share in cash represents a 110% premium to TESARO's 30-day Volume Weighted Average Price of $35.67.

The proposed transaction will significantly strengthen GSK's pharmaceutical business, accelerating the build of GSK's pipeline and commercial capability in oncology. Lonnie Moulder, Chief Executive Officer, TESARO, said: "This transaction marks the beginning of a new global partnership that will accelerate our oncology business and allow our mission of delivering transformative products to individuals living with cancer to endure."

TESARO was advised by Centerview Partners, Citigroup, Ropes & Gray and Hogan Lovells. GSK was advised by Bank of America Merrill Lynch, PJT Partners, Shearman & Sterling and Slaughter & May.

 

Tianqi Lithium, a Chinese manufacturing company, acquired a 23% stake in Sociedad Química y Minera de Chile, a Chilean chemical company and a supplier of plant nutrients, iodine, lithium and industrial chemicals, from Nutrien, a Canadian fertilizer company, for $4.1bn.

 

“A minority stake in SQM is great from our perspective, especially when we look at long-term growth and expectations for the lithium industry,” said Ashley Ozols, business development manager for Tianqi, after the deal closed.

 

Murphy Oil Corporation, a petroleum and natural gas exploration company headquartered in El Dorado, Arkansas, and Petrobras, a semi-public Brazilian multinational corporation in the petroleum industry, completed the establishment of a strategic deepwater Gulf of Mexico joint venture for net cash consideration of approximately $795m. Murphy holds 80% of the newly formed company, MP Gulf of Mexico, while Petrobras holds 20%.

“We are excited to close this transformational joint venture and form a strategic partnership with Petrobras. Our newly expanded Gulf of Mexico portfolio is consistent with Murphy’s long-term vision of increasing profitable oil-weighted production in an area where we have a long history of success. We plan to allocate a portion of the cash flow generated by the joint venture to accelerate further high-value oil-weighted activity in our Eagle Ford Shale asset,” stated Roger W. Jenkins, Murphy Oil President and Chief Executive Officer.

 

Stone Point Capital acquired Rialto Investment and Asset Management, a fully integrated real estate investment and asset management company, from Lennar Corp, a home construction and real estate company based in Miami, for $340m on Oct. 29, 2018.

Diane Bessette, Chief Financial Officer of Lennar, said: “We are very pleased to announce the successful execution of this transaction, which is a significant component of our strategy of reverting to our pure-play core homebuilding platform. The closing of this deal generates substantial cash flow, which aligns with our previously stated capital and capital allocation strategy.”

Deutsche Bank, Wells Fargo Securities and Goodwin Procter advised Lennar Corporation. Kramer Levin Naftalis & Frankel advised Stone Point Capital.

 

GFG Alliance, a global industrial company, acquired Keystone Consolidated Industries, Inc, a leading manufacturer of welded wire reinforcement products, from Contran, an industrial holding company, for $320m. Under terms of the deal, GFG Alliance company Liberty Steel USA will acquire KCI, including all its subsidiaries, for $320m in cash less certain assumed liabilities.

"The Keystone acquisition is a core part of GFG's GREENSTEEL vision to become a leading US producer of high quality, cleanly produced steel," said Sanjeev Gupta, executive chairman of Liberty and the GFG Alliance. "As we look ahead to the future, GFG will benefit from Keystone's century-long history, its robust operations, and its reputation for producing top quality steel."

GFG was advised by Deutsche Bank, Wyelands Capital and Norton Rose Fulbright. Contran was advised by Stephens and Gibson, Dunn & Crutcher.

 

Playtika, an Israeli game developer, acquired Wooga, a mobile-first game developer in Berlin, for $100m.

 

“We see great opportunities for Playtika in the casual games genre and our acquisition of Wooga firmly positions us for this next phase of our evolution” said Robert Antokol, Playtika’s Founder and CEO.

“Playtika’s strengths in live-ops, advanced AI and personalization at scale will serve as a springboard for Wooga’s creativity in ideating and developing winning story-led titles. Together we’ll bring audiences worldwide a whole new level of game experiences that never cease to captivate and engage.”

 

Marlboro cigarette maker Altria Group Inc began negotiations with Canadian cannabis producer Cronos Group. Cronos has not agreed to any deal and there is no certainty it will do so, according to a Reuters report. The discussions between Cronos and Altria are expected to last for several weeks, one of the sources added.

A deal would mark one of the largest combinations between mainstream tobacco and the booming but volatile marijuana sector, which has seen interest from a variety of major consumer companies that are monitoring the industry for disruptive threats and faster-growing product possibilities.

Uber in talks to buy a scooter-sharing start-up.

Ride-hailing company Uber is looking to conduct a multibillion-dollar takeover of a scooter-sharing start-up. The company decided that its best path for acquiring a leadership position in this market is to acquire the leaders. Uber has held negotiations with Bird, a dockless scooter-share company based in Santa Monica, California. Moreover, Uber talked with Bird’s smaller rival Lime, in which it already holds a minority stake.

Uber is rumored to be looking to secure a deal with either Bird or Lime before the end of the year.

 

Martin Sorrell’s new company, S4 Capital, said it was in advanced talks to buy MightyHive, a San Francisco-based programmatic advertising group that partners with major brands. S4 plans to integrate the firm as part of its drive to form a new business combining media and technology. The acquisition has not been confirmed, and S4 did not disclose the potential value of the purchase, which has been reported as worth up to $200m.

“The potential transaction, if consummated, is in line with the company's stated strategy of creating a new era, new media solution embracing data, content, and technology in an always-on environment for global, multi-national, regional and local clients and for millennial-driven digital brands,” S4 said in a statement.