Britain's competition regulator said Sainsbury's £7.3bn ($9.3bn) takeover of Walmart owned Asda should either be blocked entirely or require the sale of a significant number of stores, or even one of the brands.
The Competition and Markets Authority said on Wednesday its current view was "that it is likely to be difficult for the companies to address the concerns it has identified".
Sainsbury's, the second largest chain of supermarkets in the United Kingdom, and Asda, a British supermarket retailer, headquartered in Leeds first announced their merger in April 2018.
Morgan Stanley, UBS and Brunswick advised Sainsbury's. Rothschild & Co advised Walmart.
Flybe Group said it had received a preliminary proposal from Bateleur Capital, Mesa Air Group with support from Stobart Group former boss Andrew Tinkler for a possible optional financing proposal. Flybe said that the proposal was "highly conditional" and it does not believe it was executable in the time-frame required to enable Flybe to continue to trade.
Richard Branson's Virgin Atlantic, Stobart Group and Cyrus Capital agreed to buy Flybe for an initial £2.2m ($2.8m), a far cry from its £215m pounds valuation when it joined the London Stock Exchange in 2010. Additionally, they have committed to make available a £20m ($26m) bridge loan facility to support Flybe's ongoing working capital. Following completion of the Acquisition, Cyrus, Stobart Group and Virgin Atlantic are intending to provide up to £80m ($103m) of further funding to the Combined Group to invest in its business and support its growth, as well as a contribution of Stobart Air.
Evercore and Bryan Cave Leighton Paisner advised Flybe. Barclays and Hill Dickinson advised Stobart. Morgan Lewis & Bockius advised Cyrus. Rothschild & Co, Herbert Smith Freehills and FTI Consulting advised Virgin.
DP World acquired P&O Ferries for £610m.
DP World acquired the holding company of P&O Ferries and P&O Ferrymasters, a pan-European integrated logistics business consisting of ferries operation and European transportation and logistics, for £322m ($421m), implying a 2017 EV/EBITDA multiple of 6.1x. The transaction is subject to customary completion conditions and is expected to close in the first half of 2019.
Sultan Ahmed Bin Sulayem, Group Chairman and CEO, DP World, said: "We are pleased to announce the return of P&O Ferries back into the DP World family. P&O Ferries is a strong, recognisable brand and adds a best-in-class integrated logistics provider into our global portfolio. Importantly, P&O Ferries provides efficient European freight connectivity building on last year's acquisition of Unifeeder. This transaction is in line with our strategy to grow in complementary sectors, strengthen our product offering and play a wider role in the global supply chain as a trade enabler."
Mexico's Cemex to divest assets in the Baltics and Nordics.
Mexico's Cemex, one of the world's largest cement producers, agreed to the sale of assets in the Baltics and Nordics to the German building materials group SCHWENK, for approximately €340m ($385m).
Monterrey-based Cemex will use the money from the deal to reduce its debt. The firm has aggressively seeking to slash debt and regain its investment-grade rating. Consolidated operating EBITDA generated by the divested assets was approximately €27m ($31m) in 2018.
Bridgepoint acquired a minority stake in French Bee2link. (FS)
Bridgepoint Development Capital, the smid-cap division of the international private equity group, Bridgepoint, has taken a minority shareholding in bee2link – a publisher of SaaS software and digital solutions for automobile players. The terms of the transaction are confidential.
Supported by BDC, Xavier Cotelle and his team will continue to develop bee2link, focusing mainly on the company's European expansion. Xavier Cotelle and the management team reinvested significantly in the transaction and will continue to manage bee2link.
Olivier Nemsguern, Managing Partner of BDC in France, added: "In a rapidly changing automobile market, bee2link is a pioneer in the digitalization of automotive retail businesses. Its solutions cover the entire value chain and are extremely popular with leading global manufacturers. We're delighted to partner with bee2link's management team, at the cutting-edge of digital innovation in the automobile industry. With our international network and additional financial resources, our aim to assist the company in accelerating its European expansion".
SODICA Corporate Finance advised bee2link. Alantra, Mayer Brown, Deloitte, Eleven Strategy, Mckinsey and PwC advised Bridgepoint. Idinvest provided unitranche financing.
Ophir investor Petrus demands alternatives to Medco buyout offer. (FS)
Ophir Energy shareholder Petrus Advisers on Wednesday called for alternatives to Medco's buyout offer to be presented immediately and asked the company to put Petrus-backed directors in charge of overseeing the proposed changes.
Petrus, which owns a more than 3% stake in Ophir, said the company must present an alternative to Indonesia-based Medco's offer of 55 pence per Ophir share that guarantees at least $100m in tax-efficient distributions to investors.
"At this point, Medco is paying less than the fair value of Ophir's South East Asian production assets meaning they are gifted substantial synergies and the upside potential from Ophir's licenses in Tanzania, Mexico and Equatorial Guinea," Petrus said.
Israel's Rafael to buy out drone maker Aeronautics for $235m.
Israel's state-owned Rafael Advanced Defense Systems and businessman Avihai Stolero agreed to buy unmanned aerial vehicle maker Aeronautics for ILS850m ($235m) in cash, according to a regulatory filing.
The purchase price of ILS15.36 ($4.24) per share is double that of Aeronautics' average share price in the 30 days prior to Rafael making its buyout offer on Jan. 13. Aeronautics' market value has jumped to $217m from $507m on Jan. 10.
Aeronautics, which manufactures unmanned aerial vehicles for military surveillance and defence purposes, as well as for the commercial sector, will become private and its shares delisted from the Tel Aviv Stock Exchange.
South Africa unveils $5bn bailout of state power monopoly Eskom.
South Africa has unveiled the largest bailout in the country’s history for Eskom, the struggling state power monopoly, whose financial troubles have pushed it to the brink of collapse and caused rolling national blackouts.
The government will inject ZAR69bn ($4.8bn) over three years to stabilise Eskom’s $30bn debt as it attempts a turnaround, Tito Mboweni, South Africa’s finance minister, said on Wednesday as he delivered the national budget.
The risk of collapse at Eskom is a serious threat to South Africa’s already stretched public finances as its debt is mostly state-guaranteed. Without a plan to control Eskom’s rising costs, a bailout could also imperil the country’s last remaining investment-grade credit rating, with Moody’s.
GIP considers selling stake in Terminal Investment. (FS)
Investment firm Global Infrastructure Partners is considering the sale of its stake in Terminal Investment, according to
Bloomberg. GIP and a group of its investors are said to own a nearly 49% stake in the Geneva-based company.
GIP and a group of its co-investors completed the acquisition of 35% in TIL for €1.5bn ($1.9bn) from the Mediterranean Shipping Company in 2013.
German rail firm Netinera is looking for a new investor.
Netinera, the German rail subsidiary of Ferrovie dello Stato, is looking for a new investor as minority shareholder Cube is putting its 49% stake on the block, according to
Reuters.
While Ferrovie will stay invested, Cube will shortly start marketing its stake to other infrastructure investors, with a view of striking a deal before the summer break. Sales agent Rothschild & Co is expected to send out information packages on the company, which may fetch a valuation of €650-800m ($736-906m), including debt, to suitors next month.
Rothschild & Co is advising Cube.
Delta & EasyJet consider up to €400m stake in Alitalia.
According to
Bloomberg, Delta Air Lines and EasyJet may invest as much as €400m ($452m) in the latest attempt to revamp struggling Italian airline Alitalia.
Investors in a group led by rail operator Ferrovie dello Stato are evaluating the financial needs of the "new Alitalia" that would emerge after the second bankruptcy process in a decade.
Cat Rock Capital says Just Eat shareholders back merger proposal. (FS)
Just Eat shareholder Cat Rock Capital Management said it was pleased to find "strong support" from several other stakeholders for its suggestion that the London-listed takeaway ordering website actively engages in merger discussions.
An activist investor urged online food delivery firm Just Eat to pursue merger talks with a peer such as Takeaway, saying it did not trust the board to get the appointment of a new CEO right.
"We have been particularly encouraged to hear that several other Just Eat shareholders have written to the Board to express their view... that it should be actively engaging in merger discussions with well-run industry peers," Cat Rock said in a statement.
Cat Rock Capital, which has stakes in both Just Eat and Dutch-listed Takeaway, said Just Eat was likely to attract significant interest from potential partners if it chose to seek a deal as a route to strong management and growth.
FSN makes a final exit from Netcompany. (FS)
FSN Capital launched an accelerated bookbuild to institutional investors to sell a block of over 3m shares (6.23%) in Danish IT services business Netcompany. Based on DKK225 ($34.12) closing share price entire stake is valued at DKK700m ($106m).
FSN sold 7.1m shares in November valued at $244m.
Allianz X increased fund size to €1bn. (FS)
Allianz X, the digital investment unit of the Allianz Group, received additional investment from Allianz, increasing its fund size to €1bn ($1.1bn). The increase is the result of Allianz X's investment track record, successful collaborations with growth companies as well as the contribution towards the Group's overall digital transformation strategy.
The funds will be used to make additional direct investments in digital companies globally that are strategically relevant for the Allianz Group. Allianz X becomes one of the largest European firms dedicated to digital investment by fund size, uniquely leveraging the world's leading insurer and asset manager.
"We are very pleased with the progress Allianz X has made thus far and are committed to invest further and develop the next generation of digital growth companies related to Allianz's core business," says Iván de la Sota, Chief Business Transformation Officer of Allianz. "Our digitalisation approach is multifaceted; Allianz X is a valuable addition – not only in meeting the changing expectations of our customers."
HIG Capital closed €673m European real estate-focused fund. (FS)
HIG Capital's value-add Europe property fund has exceeded its €500m ($566m) fundraising target by more than a third at final close. The HIG Europe Realty Partners II fund will principally make investments in the small and mid-cap real estate sector in Europe.
The fund, which raised €673m ($761m), already made 8 investments, including an office building in Paris, a retail park in Italy, logistics assets in Denmark, an office building in Milan, two credit deals to a German and a UK borrower respectively, a hotel in Germany and offices in Norway.
Sami Mnaymneh and Tony Tamer, Co-CEOs of HIG, said: "The fund will continue to build on our local, on the ground pan-European presence and is already 16% committed."
GIC & Atlas Merchant bought 25% stake in Ascensus. (FS)
Singapore's GIC teamed up with Atlas Merchant Capital to acquire just under a 25% stake in Ascensus, the largest independent retirement and college savings services provider in the US from Genstar Capital and Aquiline Capital Partners. Financial terms were not disclosed.
The sellers will continue to maintain control over the company. The transaction is expected to close in the first quarter, following regulatory approvals and other customary closing conditions.
"We're extremely pleased that the Atlas investor group has chosen to invest in Ascensus," said Bob Guillocheau, chairman and chief executive officer of Ascensus. "We're also grateful to have the continued support of our owners Aquiline and Genstar as we continue to focus on delivering exceptional service to our clients and boost our future growth."
Barclays, JP Morgan and Willkie Farr & Gallagher advised Ascensus. Debevoise & Plimpton advised Atlas Merchant Capital and Sidley Austin advised GIC.
The US Federal Trade Commission has given Germany's Fresenius Medical Care and US home dialysis equipment maker NxStage Medical antitrust approval for their merger.
To win approval for the $2bn deal, the companies agreed to sell NxStage's bloodline tubing set business. Fresenius and NxStage together dominate the market for the single-use plastic tubes used during dialysis, the agency said.
"We would anticipate closing the NxStage deal over the next couple of days," said Fresenius Chief Executive Rice Powell.
BofA Merrill Lynch and Sullivan & Cromwell advised Fresenius Medical Care. Piper Jaffray advised NxStage.
Tilray to buy hemp food maker for about CAD419m.
Tilray, a global leader in cannabis research, cultivation, production and distribution, agreed to acquire all of the issued and outstanding securities of FHF Holdings (known as Manitoba Harvest), from Compass Group Diversified Holdings and other shareholders of Manitoba Harvest. Tilray will acquire Manitoba Harvest on a cash and debt-free basis for up to CAD419m ($316m).
“Tilray’s acquisition of Manitoba Harvest is a milestone for the cannabis industry. It builds on the strategic partnerships we have formed with consumer brand industry leaders and demonstrates our track record of disrupting the global pharmaceutical, alcohol, CPG, and functional food and beverage categories,” said Brendan Kennedy, Tilray President and CEO. “We’re excited to work with Manitoba Harvest to develop and distribute a diverse portfolio of branded hemp-derived CBD food and wellness products in the U.S. and Canada.”
Cowen, Cooley and Blake Cassels & Graydon advised Tilray. Stikeman Elliott advised vendors. Jefferies advised Compass Group Diversified Holdings.
Starboard, a hedge fund, bought shares in Bristol-Myers.
Bristol-Myers Squibb said that activist hedge fund Starboard Value wants to add five directors to its board and bought one million shares after the pharmaceutical company said it plans to buy biotech company Celgene.
"Starboard Value sent Bristol-Myers Squibb a notice of nomination in connection with Bristol-Myers Squibb's 2019 Annual Meeting of Stockholders," the company said in a regulatory filing, adding that the hedge fund proposed five directors, including the firm's co-founder, Jeffrey Smith.
Starboard target Magellan Health to explore a potential sale.
US healthcare plan and pharmacy benefits manager Magellan Health will explore selling itself after coming under pressure to do so from activist hedge fund Starboard Value, according to
Reuters.
Magellan is in the early stages of considering acquisition interest expressed in the company cautioning there is no certainty a deal will materialize.
Goldman Sachs advises Magellan Health.
Warburg to weigh possible sale of jet-parts maker CPP. (FS)
According to
Bloomberg, Warburg Pincus is considering a sale of Consolidated Precision Products that could value the aerospace parts manufacturer at more than $2bn. Its parts are used in Boeing and Airbus aircraft and F-35 fighter.
Cleveland-based CPP is working with an adviser to examine strategic options including the possibility of a sale in the second half of the year. If Warburg pursues an auction, CPP is likely to attract interest from other private equity firms as well as strategic buyers.
Australia's APA is looking for US gas pipeline acquisition.
Australia's biggest gas pipeline company, APA Group, has resumed its search for a U.S. acquisition, after putting the move on hold last year while it dealt with a takeover offer, its chief executive said.
APA Managing Director Mick McCormack said the company, which has a market value of AUD11bn ($7.9bn), had identified a few opportunities to acquire a US gas transmission or distribution business potentially.
"We want to buy something that's meaningful, worth the effort, diversifies our assets geographically, but not so big that it would cause indigestion to APA," McCormack said.
Google to buy data migration company Alooma in cloud push.
Alphabet's Google said it would buy data migration company Alooma, as part of efforts to catch up with bigger cloud service rivals Amazon and Microsoft. Alooma helps enterprise companies streamline database migration in the cloud with a tool that enables moving data from multiple sources to a single data warehouse.
Google trails Amazon and Microsoft in the fast-growing business of helping companies move to the cloud, with Google Cloud holding 8.5% of worldwide cloud market share at the end of 2018. Amazon Web Services had a 31.7% share and Microsoft Azure 16.8% during the same period.
AngloGold Ashanti puts Argentina mine up for sale.
AngloGold Ashanti said it was putting its interests in an Argentine mine Cerro Vanguardia up for sale as it looks to focus on operations with a longer shelf life and ability to deliver higher returns.
AngloGold Chief Executive Kelvin Dushnisky, Barrick Gold's former president, was appointed to head the firm last year and has rolled out plans to streamline its portfolio, set a 15% hurdle on returns on investment and cut debt leverage targets to a ratio of 1.0 times net debt to adjusted EBITDA.
"As we look at the assets portfolio it is very important that we can see the assets in our mix have long-term potential and to the extent that they don't or there is other strategic reasons to disinvest, we will do that. [...] It's a single asset in an area where we are not likely to be focusing and investing more given the other opportunities we have in the pipeline to invest elsewhere in higher return projects and in areas where we have critical mass," Dushnisky said.
APAC
Chocolatier Godiva to sell Asian-Pacific operations to MBK Partners. (FS)
Godiva Chocolatier, the Belgian manufacturer of gourmet chocolates, agreed to sell parts of its Asia-Pacific business to private equity firm MBK Partners. The deal includes Godiva's operations in Japan, South Korea and Australia, and the production facility in Belgium supplying these regions. Financial terms were not disclosed, but the transaction is rumoured to be worth between $1-1.5bn.
Annie Young-Scrivner, CEO of GODIVA Chocolatier added, "We believe this deal is a win-win for everyone. It gives us the financial flexibility we need to execute our 5x growth strategy by accelerating efforts in new and existing markets and supporting the plan of opening of more than 2,000 cafes globally while preserving our Belgian legacy, quality, and craftsmanship that have helped to make our brand iconic."
Hong Kong Exchange to buy 51% stake in Chinese financial tech firm.
Hong Kong Exchanges and Clearing, the stock exchange operator in the Asian financial hub, agreed to buy 51% stake in Ronghui Tongjin Technology, a unit of Shanghai-listed Shenzhen Kingdom Sci-Tech, to bolster the markets' technological capabilities. Financial terms were not disclosed.
"The proposed acquisition will support HKEX's strategy to further build its financial markets' technological capabilities, at a time of rapid change in the global exchange landscape," said the exchange statement.
ArcelorMittal looks to buy Essar's power plant.
ArcelorMittal, the world's biggest steelmaker, has bid INR48bn ($673m) to acquire Essar's 1200MW power plant in central India, one of the most prized assets in the debt-ridden group's power portfolio.
The bid for the power plant once again pits ArcelorMittal chief Lakshmi Mittal against the Ruia family, who are already fighting to prevent their flagship steel asset from falling into the hands of the global steel giant. Essar's creditors are selling many of the group's assets to recover billions of dollars of loans, leaving Essar Group with little say over who buys the assets. Government-owned Power Finance Corp is the lead creditor of the power plant and PFC's Chairman Rajeev Sharma disclosed ArcelorMittal's bid. He said that the Essar family had also made an INR35bn ($490m) bid for the power plant, but ArcelorMittal's bid was 37% higher.
Sharma said PFC has yet to decide on either offer for the asset, known as the Mahan power plant, which has debt worth INR74bn ($1bn).
India is an investment priority for Saudi Aramco.
Saudi Aramco said that investing in India is a priority for the company, and it expects the country's oil demand to rise to 8.2m barrels per day by 2040, while today's demand is 800k barrels per day.
CEO Amin Nasser is part of the entourage travelling with Saudi Arabia's Crown Prince Mohammed bin Salman, who is in India for a one-day visit. The prince is in India along with leading Saudi businessmen and company representatives at the invitation of Prime Minister Narendra Modi.
Tencent will not scale back on investments this year.
Tencent Holdings will not scale back on investments this year after a record high of 16 companies it invested in launched IPOs last year, President Martin Lau said at a closed-door investor conference according to
DealStreetAsia.
Lau said 2018 was the best year for the company in terms of investment. Tencent invested in more than 700 companies in the past 11 years and 63 of those are now listed, while 122 are valued at more than $1bn.
Shares of Tencent fell 23% in 2018.
TPG Capital acquired 35% stake in Australian Safe Work Laboratories. (FS)
TPG Capital Asia is said to have acquired a significant minority stake in Melbourne-based drug testing company Safe Work Laboratories, according to
Australian Financial Review. SWL offers drug and alcohol policy advice, training and education, onsite drug and alcohol testing, and laboratory services.
The deal comes just six months after the US private equity firm took over the Southeast Asian pathology operations of Australian healthcare group Healthscope. The report said, PAH (Australia), a business linked to TPG Capital Asia, has purchased a 35% stake in Safe Work Laboratories' ordinary shares and all of the company's preference shares, and the acquisition was closed last week. A couple of TPG's Asia-based executives have joined the target firm's board.
TPG Capital is expected to add Safe Work Laboratories to its current Asia pathology platform, Pathology Asia Holdings, and form a broader regional play.
GIC & Mitsubishi eye GMR Airports stake. (FS)
GMR Infrastructure is in the final round of discussions with GIC and Mitsubishi to sell 25-30% stake in its unit GMR Airports, according to
Business Standard. The proposed equity sale, which could generate INR70-80bn ($979m-1.1bn), is likely to be announced very soon. The potential deal will help GMR to reduce the overall debt of the company to around INR125bn ($1.7bn) from INR199bn ($2.8bn).
Bain & GIC to pare $322m stake in Genpact. (FS)
According to
DealStreetAsia, Genpact's investors, Bain Capital and GIC, are trimming their stake in the business process management firm by selling around 10m shares. Bain is selling about 8.5m shares while GIC about 1.5m shares, amounting to a total of 21% stake. The sellers are estimated to rake in over $322m from the share sale. Last week, Genpact announced a follow-on public offering by its largest shareholders. Both investors will continue to hold around 20% stake in the company post the share sale.
Bain hired managers for Toshiba Memory IPO. (FS)
Bain Capital has picked Nomura and Mitsubishi UFJ Morgan Stanley to manage an initial public offering of Japan's Toshiba Memory, a deal that could happen as early as September, according to
Reuters.
In preparation for the listing, Toshiba Memory is likely to buy back some JPY400bn ($3.6bn) in preferred shares currently held by US tech firms Apple, Dell, Seagate and Kingston.
The listing of the world's second-largest maker of NAND flash memory chips, which a Bain-led consortium bought for $18bn last year, could be Japan's biggest IPO this year. It would also mark a swift exit by Bain - the firm had previously flagged it was looking for an IPO within three years.
