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AMERICAS
Microsoft, Activision CEOs to defend $69bn deal in fight with FTC.
Microsoft Chief Executive Officer Satya Nadella and Activision Blizzard CEO Bobby Kotick will be in court this week to try to persuade a federal judge in California to reject the Federal Trade Commission’s effort to block their $69bn deal.
US District Judge Jacqueline Scott Corley is presiding at a five-day hearing in San Francisco starting Thursday over the FTC’s bid to prevent Microsoft from acquiring Activision while the agency’s legal challenge to the deal is pending. Nadella and Kotick were listed as key witnesses in a joint court filing Tuesday, Bloomberg reported.
Activision Blizzard is advised by Allen & Company (led by Nancy Peretsman), Morgan Stanley (led by Anthony Armstrong), Skadden Arps Slate Meagher & Flom (led by Sonia Nijjar and Kenton J. King), Brunswick Group (led by Jonathan Doorley) and FGS Global (led by Paul Verbinnen). Financial advisors are advised by White & Case (led by Denise A. Cerasani). Microsoft is advised by Goldman Sachs (led by Sam Britton), Osler Hoskin & Harcourt, Sidley Austin (led by C. Frederick Beckner, Christopher T. Shenk and Robert Keeling), Simpson Thacher & Bartlett (led by William Allen, Anthony Vernace and Alan Klein), Weil Gotshal and Manges (led by Mike Moiseyev) and Assembly Media.
J.F. Lehman-backed Trident, a maritime systems and solutions provider, completed the acquisition Custom Alloy, a vertically integrated provider of highly specialized alloyed forgings, fittings, and pipe to defense and industrial end users. Financial terms were not disclosed.
"The acquisition of CAC expands our presence on key U.S. Navy nuclear vessel programs, a critical element of our growth strategy. Trident's growing scale and breadth of offerings allow us to more holistically partner with our shipbuilding customers to efficiently deliver the solutions required by them and the U.S. Navy," Alex Harman, Trident Chairman and J.F. Lehman Partner.
Custom Alloy was advised by SSG Capital, Cole Schotz and Rabinowitz Lubetkin & Tully. Trident was advised by Blank Rome and Keller Benvenutti Kim.
Flexpoint Ford, a private equity firm, agreed to acquire Baker Hill, a provider of cloud-based, end-to-end loan origination, risk management, and analytics software. Financial terms were not disclosed.
"Baker Hill has a long-standing reputation for being a trusted provider of differentiated loan origination and risk management software, which has helped fuel our consistent growth each year. This ongoing market validation is a source of inspiration for our team and by partnering with Flexpoint we can continue to elevate the lending experience for our bank and credit union clients. Our team is confident this partnership will provide new opportunities to deliver more value for our clients and the communities they serve," John M. Deignan, Baker Hill President and CEO.
Baker Hill is advised by Leonis Partners, Raymond James and Jones Day. Flexpoint Ford is advised by William Blair & Co and Paul Weiss Rifkind Wharton & Garrison (led by Krishna Veeraraghavan and Brian Kim).
Arkon Energy, a data center infrastructure company, completed the acquisition of a 200MW Ohio data center facility. Financial terms were not disclosed.
"The successful acquisition of the site in Hannibal, Ohio is a significant milestone in the Arkon Energy story and establishes the Company as a leading globally diversified data center provider. We are excited to expand our footprint in Ohio, which is quickly becoming a leading state for data center infrastructure. Arkon will create rural technology jobs, expand Ohio's electrical customer base, and invest in the local community," Joshua Payne, Arkon CEO.
Arkon Energy was advised by Cohen & Company Capital Markets, Bull & Co, McCullough Robertson and Winston & Strawn. Debt financing was provided by Barkers Point Capital.
Fortune Brands, an industry-leading home and security products company, completed the acquisition Emtek and Smart Residential business in US and Canada of ASSA ABLOY, a Swedish conglomerate, for $700m.
“This Acquisition is perfectly aligned to our strategy as a brand, innovation and channel leader. Yale and August will bring two great brands and significant engineering expertise into our already powerful security portfolio. Emtek and Schaub allow us to enter a branded, growing and highly profitable category in a leadership position, where we can accelerate innovation and leverage our channel and consumer insights to create significant value over time. This transaction is consistent with Fortune Brands’ disciplined approach to value-creating acquisitions,” Nicholas Fink Fortune Brands CEO.
accesso Technology Group, a technology solutions provider for attractions and venues worldwide, agreed to acquire VGS, a ticketing and visitor management system provider for leisure, entertainment and cultural businesses around the globe, for $53m.
"I am beyond excited to announce the transformative acquisition of VGS. Its solution fits squarely into our technology roadmap and its top-tier customer base speaks volumes for the quality, scalability and functionality of the platform. This acquisition will allow us to provide our clients and future partners with technology that has the capacity to scale with their business long into the future and keep up with the growing demands of the modern consumer," Steve Brown accesso CEO.
Topspin, a private equity firm that makes investments in established, profitable, and fast-growing middle-market consumer businesses, completed the acquisition of consumer products division of Three Dog Bakery, a company that sells biscuits, cookies, cakes, and meals intended for dogs. Financial terms were not disclosed.
“Topspin has extensive experience building consumer brands and a strong network within the pet sector, making them the perfect partner as we enter our next phase of growth. Pet parents are becoming increasingly aware of the importance of providing their best furry friends with more wholesome options, and we are confident that our unique product offering, which directly taps into pet humanization trends, is changing the way people think of dog treats. As the pet food industry continues to evolve, we will be well-positioned with Topspin’s support to expand our brand and increase our market share in the US,” Jerry Dear, Three Dog Bakery President.
Topspin was advised by Lowenstein Sandler and FGS Global (led by Julie Rudnick).
Oldcastle, a vertically integrated manufacturer, fabricator and distributor of architectural hardware, glass and glazing systems, completed the acquisition of Syracuse Glass, an independent fabricator and distributor of architectural glass and aluminum products serving glazing contractors, manufacturers and glass retailers. Financial terms were not disclosed.
"Syracuse Glass Company has delivered high quality products and excellent customer service in its markets for more than a century. We are excited about the prospect of leveraging our collective cultures and capabilities to build on SGC's great reputation. This acquisition will allow our teams to provide industry-leading glazing solutions to better serve our customers and partners and help them be successful. Our enhanced presence in the Northeast region of the U.S. will enable OBE and SGC to capitalize on the market opportunity and grow our industry-leading market position," Bruno Biasiotta, Oldcastle BuildingEnvelope CEO.
Oldcastle was advised by Paul Weiss Rifkind Wharton & Garrison (led by Cullen Sinclair).
Blackstone, an active investor across energy, transportation, digital infrastructure and water and waste infrastructure sectors, completed the $1bn investment in Invenergy, company that operates in renewable fuels sector.
“We are proud to support the continued growth of Invenergy’s business. Invenergy has a premier platform for developing, owning, and operating clean energy projects and we are excited to continue supporting the realization of these projects and their important contribution to decarbonizing the energy sector,” Matthew Runkle, Blackstone Senior Managing Director.
Gilinski Group, an investment firm, JGDB, a holding company, Nugil, a financial services company, and IHC, an investment manager company, agreed to acquire a majority stake in Nutresa, a food processing company. Financial terms were not disclosed.
KKR agrees to buy up to $44bn of PayPal’s pay-later loans. (FS)
KKR agreed to purchase as much as $44bn of buy-now-pay-later loan receivables from PayPal in a deal that frees up the payments giant to do more share repurchases. The agreement is part of a €3bn ($3.3bn) loan commitment that allows private credit funds and accounts managed by KKR to purchase loans originated by PayPal in France, Germany, Italy, Spain, and the UK. PayPal expects the transaction to generate $1.8bn in proceeds, allowing it to repurchase an additional $1bn of shares this year, Bloomberg reported.
While the concept of split installment payments for consumer purchases has been around for decades and online consumer financing has been a strategic offering of PayPal since 2008, BNPL has dramatically increased in popularity over the past several years. Since launching its first BNPL offering in 2020, PayPal has become an industry leader with its PayPal Pay Later products, issuing more than 200m loans to over 30m customers in eight markets around the world.
Private equity-backed Savers Value Village targets $2.7bn valuation in US IPO. (FS)
Savers Value Village said it aims to raise up to nearly $320m for an initial public offering that would value the US thrift store operator at about $2.7bn. Owned by private equity firm Ares Management, the company plans to sell up to 18.8m shares at $15 to $17 apiece, Reuters reported.
Based in Bellevue, Washington, Savers Value Village is one of the largest retailers of secondhand clothing, books, toys, shoes and household goods, with 317 stores in the United States and Canada. Revenue totaled $1.44bn in 2022, up 19% from the prior year, while net income was flat at $84.7m. Ares Management will retain an 88% stake in Savers Value Village after the IPO. The company said two large institutional investors, Canada's Ontario Pension Plan and Norway's Norges bank Investment Management, have indicated interest in buying up to $130m worth of the shares.
EMEA
Cadeler, an offshore windmills installation services provider, agreed to merge with Eneti, an offshore wind farm construction and services, in a $597m deal.
“The combination will represent a significant step up in our ability to meet the increased demand globally for projects with larger scopes and project sizes in service of the much-needed green transition. To deliver on this ambition, we will provide our customers with the largest and most diverse fleet in the industry, operated by highly skilled teams with unique expertise and track records. For customers, the combined fleet will unlock unrivalled value due to increased cross-utilization of resources and improved flexibility, capacity, and agility," Mikkel Gleerup, Cadeler CEO.
Eneti is advised by Perella Weinberg Partners, Bech-Bruun, CMS and Seward & Kissel. Cadeler is advised by DNB Bank, Campbell Johnston Clark, Davis Polk & Wardwell (led by Connie I. Milonakis), Gorrissen Federspiel and Thommessen.
CVC Capital Partners, a private equity firm, completed an investment in SD Worx, an HR and Payroll solutions provider. Financial terms were not disclosed.
“We are convinced that this partnership will help SD Worx further solidify its leading position in the European HR services and software industry. In our long journey, we have moved from a Belgian domestic player to a European leader, present in 26 countries. In CVC, we have found a strong financial partner endorsing our strategy of organic growth and further international expansion. CVC’s complimentary experience will be important in helping us to achieve our European growth ambition, with WorxInvest as long-term majority shareholder," Filip Dierckx, SD Worx Chairman.
SD Worx was advised by Belfius Bank, Morgan Stanley and Freshfields Bruckhaus Deringer. CVC Capital was advised by BNP Paribas, Ernst & Young, Kumulus Partners and Allen & Overy.
Harvest Partners, an investment firm, completed the acquisition of a majority stake in Sparq, a provider of outsourced digital engineering to build, deploy and support digital applications, products, and experiences. Financial terms were not disclosed.
“We’ve been impressed by the Harvest Partners Ascend team’s industry knowledge, expertise, and record of success, and believe we’ve found the right partner to help us scale the business to the next level. This partnership will help to drive our expansion into new geographies and add new high-value digital consulting and product engineering capabilities as we continue to build Sparq into a leading provider of outsourced digital engineering for technology driven and Fortune 1000 companies. We are grateful to Bain Capital Double Impact for their support and partnership to date,” Monty Hamilton, Sparq CEO.
Harvest Partners was advised by William Blair & Co and Ropes & Gray. Sparq was advised by Houlihan Lokey, Morris Manning & Martin and Lambert & Co (led by Lisa Baker).
SEB Kort Bank, a corporate payment solutions provider, agreed to acquire AirPlus, a provider within corporate payment services, from Lufthansa, a company that provides passenger and cargo air transportation services worldwide, for €450m ($491m).
“We are pleased to have found a strong new owner for AirPlus from the financial industry. SEB Kort brings along a great amount of experience in the payment business and has the full support of the AirPlus management. AirPlus is perfectly positioned in the market and, as part of a larger financial group, will be able to realize its potential better than in the Lufthansa Group. In turn, it enables us to focus even more on further improving the profitability and capital return of the Lufthansa Group core business. My thanks go to the employees of AirPlus. They have made their company a global leader in B2B payment services,” Remco Steenbergen, Lufthansa CEO.
SEB was advised by JP Morgan, SEB Corporate Finance and Freshfields Bruckhaus Deringer.
The shareholders of Sohar International have voted in favour of the merger with HSBC Oman. The shareholders of HSBC Bank Oman have also voted to approve the merger.
"We are working closely with HSBC Bank Oman to ensure a smooth process to minimize disruption, if any, to HSBC Bank Oman customers and, together, have set a tentative target date of 17th August 2023 as the date of completion of the merger. This timeline remains subject to all formal steps and actions being completed without any delays on account of factors beyond the control of Sohar International and HSBC Oman," Sohar International.
HSBC Oman is advised Clifford Chance. Sohar International is advised by Citigroup and Freshfields Bruckhaus Deringer.
Unigestion, an investment management company, completed the acquisition of Springer Fachmedien München, a publishing company, from Springer Nature, a German-British academic publishing company. Financial terms were not disclosed.
“We were attracted by the company’s leading position as well as its differentiated business model, which fits our investment strategy very well. From an ESG perspective, TecVia creates a direct benefit for society by providing quality education. We are pleased to support TecVia’s continued growth path, as an independent company in the future," Philipp Scheier, Unigestion Partner.
Engie, an energy company, and Meridiam, a private equity firm, agreed to acquire BTE Renewables, a renewable energy company, from Actis, an investor in sustainable infrastructure. Financial terms were not disclosed.
“I am delighted to announce that BTE Renewables will be sold to two leaders in energy and sustainable infrastructure both regionally and globally. The sale of BTE Renewables marks our fifth energy platform exit in Africa, where we have now built and owned 5GW of generation capacity, making Actis one of the largest investors in the regional energy sector. We are confident that BTE, with its new shareholders, will continue to play a leading role in the energy transition across Africa," Lisa Pinsley, Actis Head of Middle East & Africa Energy.
Actis is advised by Citigroup.
Novo, a holding and investment company, agreed to acquire Ellab, a company that provides software and hardware for validation and monitoring for the life sciences industry, from EQT EQT Partners, a private equity firm. Financial terms were not disclosed.
“Ellab’s solutions play a vital role in ensuring accuracy and compliance in its clients’ biotech and pharmaceutical processes, which is key for these companies. This was true when we first invested in Ellab and remains the case today. The difference now is the scale and flexibility that Ellab offers, as it has transformed into a full-suite provider of validation and monitoring solutions and services. It has been a privilege to partner with the entire Ellab management team, who have built a company with a strong culture and customer focus, dedication to innovation and commitment to consumer safety. We believe Novo Holdings is a great partner for the next stage of Ellab’s growth journey and we wish them all the best in the future,” Rikke Kjaer Nielsen, EQT Partner.
CSIC Longjiang GH Gas Turbine, a developer of small and medium-sized gas turbines in a 5 to 50 MW range as well as high performance and combustion technologies, agreed to acquire gas turbine business from MAN Energy Solutions, a producer of industrial grade engines. Financial terms were not disclosed.
"The acquisition of the MAN ES gas turbine business is based on the major decision made by GHGT for advanced technology and globalization strategy, which is in line with China's and even the world's "Carbon Peak & Carbon Neutrality" strategy for the development of energy equipment. GHGT has been focusing on the research and development of small and medium-sized gas turbine products and related cutting-edge technologies. Through this acquisition, it will accelerate the construction of our product spectrum and global supply chain and help GHGT to become a world-class small and medium-sized gas turbine enterprise. We are fully aware that the teams from Oberhausen, Germany and Zürich, Switzerland are one of the important forces to achieve the strategic goals. Therefore, we will make a series of efforts, starting from the establishment of a corporate culture of mutual trust and mutual integration, to create a highly reliable and more professional development platform for all foreign transferred employees," Lin Feng, GHGT Board Chairman.
Italy’s Eni nears $5bn deal for Neptune Energy.
Italian energy group Eni is nearing a deal to acquire oil and gas explorer Neptune Energy Group for about $5bn. Eni could announce a deal as soon as this week for private equity-backed Neptune. Eni is poised to beat out suitors, including TotalEnergies, for the asset, Bloomberg reported.
No final decision has been made and the timing of the deal could change, or talks could still fall through. Neptune is backed by Carlyle Group and CVC Capital Partners. Eni has had Neptune on its radar since at least late last year as the company seeks to expand its natural gas business. Roughly three quarters of Neptune’s production comes from natural gas in the North Sea, North Africa and Asia — all regions where Eni operates.
German buyout of biggest power grid stalls as officials haggle.
Germany’s acquisition of its largest power grid from Dutch state-owned TenneT bütün ortaklık will be delayed until after the summer as government officials hammer out a deal. The purchase worth as much as €30bn ($33bn) is spilling into the second half of the year as negotiators struggle to agree on the price and how much investment the German unit will need to improve the network. An agreement was expected as early as the end of this month, Bloomberg reported.
The acquisition is part of Germany’s efforts to consolidate the country’s power grids and bolster energy security as the network needs investment that the current Dutch owners are seen as unlikely to provide. More control will also help Germany reach its goal of climate neutrality by 2045, an undertaking that requires a massive overhaul of the nation’s grid to balance its industrial heartland in the south with clean energy sources elsewhere.
Mike Ashley bought a $65m stake in Next and no one noticed.
Mike Ashley's company has this month made numerous “strategic investments” in listed rivals including Asos, Boohoo, Currys and AO World. The shopping spree adds to an investment portfolio that already included minority stakes in Hugo Boss, Mulberry and N Brown. Here’s another name for the list: Next, Britain’s biggest retailer by market value, Financial Times reported.
Frasers last year bought 1m Next shares with a value at the time of approximately £60m ($65m), according to data compiled by Argus Vickers, a specialist shareholding analysis service. Its data also shows that, between the end of March and mid May of 2023, Frasers then halved the Next stake to 500k shares. Asked about the investment in Next, Frasers said it had not made any regulatory filing to that effect and declined to comment further. A Next spokesman said he couldn’t give a definite answer on whether or not Frasers was a shareholder.
Financials Acquisition SPAC seeks extra time for insurance deal.
Financials Acquisition said it would seek shareholder permission next month for more time to create a billion pound ($1.28bn) insurance undertaking. The special purpose acquisition company, which was floated in April 2022, said it has identified a potential target company which could involve the company raising "substantial" additional funds. It would become a listed operating company deploying funds into the Lloyds of London insurance market for reinsurance purposes. The company said it will be seeking shareholder approval next month to extend the deadline for completing a deal until the end of December, Reuters reported.
Lloyd's has created a new structure, London Bridge 2 PCC, which allows easier access for institutional capital into the market. The company said it expects to have access to up to one billion pounds of capacity into the 2024 underwriting year. Proposals are at an early stage and the company said it remains confident that with the benefit of an extension it would be able to complete this deal or another business combination.
Vodafone hires Morgan Stanley to weigh options for its Spanish unit.
Britain telecoms company Vodafone has hired investment bank Morgan Stanley to evaluate the options for its Spanish unit, Spanish newspaper Expansion reported citing unidentified market sources.
The company has started a strategic review on the future of its Spanish unit and its CEO Margherita Della Valle said last month the company's management is open to "structural change", Reuters reported.
Yacht-maker Ferretti takes stock orders for Milan launch.
Italian yacht maker Ferretti, pursuing an additional listing of shares in Milan, started taking stock orders from investors on Wednesday, as the luxury sector defies a tough economic backdrop. The company, which already trades on the Hong Kong bourse, plans to sell up to 97m existing shares, representing around 28.7% of its share capital. It expects to price and allocate shares among investors by the end of the week, with a view to debuting in Milan on June 27, Reuters reported.
One of the investment banks acting on the share sale said shortly after launch that indicated investor demand covered the full size of the transaction. The broader economy has suffered from inflation, the lingering impact of pandemic and the Ukraine war, and a general lack confidence in other sectors has translated into a dearth of new listings, but European luxury stocks have boomed. French group LVMH became the first company in the region to reach a market capitalisation of more than €500bn ($546bn) earlier this year. Ferretti, which is controlled by Chinese conglomerate Weichai Group, completed its initial public offering in Hong Kong just over a year ago.
PIF-backed oil driller gets approval for $1bn Riyadh IPO. (FS)
Ades Holding, the oil and gas driller backed by Saudi Arabia’s sovereign wealth fund, has received regulatory approval for its initial public offering in Riyadh, which could be one of the kingdom’s biggest this year. The IPO will consist of a 30% stake in the company, Saudi Arabia’s Capital Market Authority said Wednesday. The listing could raise about $1bn, Bloomberg reported.
The Public Investment Fund teamed up with the major owners of Ades to take the business private in 2021, in a deal valuing the company at about $516m. Ades, which provides oil-and-gas drilling and production services in the Middle East and North Africa, has since grown through acquisitions. The company had initially targeted going public in the first half of the year but decided to hold off as it waited for a suitable market window.
APAC
Canal+ Group, a provider of premium-content and themed networks as well as bundled and distributed pay-TV offerings, agreed to acquire a 26.1% stake in Viu, a video streaming subscription service, from PCCW for $300m.
"I am extremely happy to announce this partnership with PCCW. CANAL+ already has leading market positions in Europe and Africa. We are now looking forward to developing Asia as an additional growth engine for the group. Our investment in Viu is a major step towards achieving this goal. Viu is already a business with scale, with its hybrid AVOD and SVOD business model and focus on local content, it has all the ingredients to deliver superior growth and continue to be a leading service in the region and beyond," Maxime Saada, CANAL+ Group CEO.
Canal+ Group is advised by Ernst & Young, Goldman Sachs, and Herbert Smith Freehills. PCCW is advised by Jefferies & Company and Slaughter & May.
CYVN Holdings, an investment vehicle majority owned by the Abu Dhabi Government, agreed to acquire a 7% stake in NIO, a smart electric vehicle manufacturer, for $739m.
“The strategic investments from CYVN Holdings demonstrate NIO’s unique values in the smart electric vehicle industry. The Investment Transaction will further strengthen our balance sheet to power our continuous endeavors in accelerating business growth, driving technological innovations and building long-term competitiveness. In addition, we are excited about the prospect of partnering with CYVN Holdings to expand our international business. With the vision of Blue Sky Coming, we will continue to strive for technological breakthroughs and user experiences beyond expectations, contributing to a more sustainable future for the globe," William Bin Li, NIO Founder, Chairman and CEO.
NIO is advised by Skadden Arps Slate Meagher & Flom (led by Yuting Wu).
CVC weighs a $1bn sale of Firm Fast Group. (FS)
CVC Capital Partners is considering options including a sale of its significant minority stake in Philippine logistics company Fast Group after receiving interest from potential buyers.
The alternative investments firm has been in talks with possible suitors for its stake, in a potential deal that could value the whole business at about $1bn. Other investment funds and companies in the industry have shown preliminary interest in a deal, Bloomberg reported.
Mazda eyes EV battery supply partnership with Panasonic Energy.
Japanese automaker Mazda Motor and the energy unit of Panasonic Holdings will start talks to set up a battery supply partnership for electric vehicles. Such an effort on lithium-ion batteries is likely to carry Mazda a step closer to ramping up production of EVs, in a $10.6bn spending plan it unveiled in November to drive electrification of vehicles. In the partnership, Panasonic Energy would supply Mazda with automotive cylindrical lithium-ion batteries made in Japan and North America for Mazda EVs expected to be rolled out in the latter half of this decade, Reuters reported.
The companies said their talks will focus on a partnership for the medium to long term. In 2012, Mazda used 1865 battery cells supplied by Panasonic in its Demio EV in Japan, leasing out 100 units of the subcompact as a trial for boosting knowledge about electrification. Japanese automakers are gearing up to compete for a bigger share of the global EV market.
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