Acquisitions Monthly articles from October 2003

Acquisitions Monthly archives from October 2003

Risk of third consecutive yearly decline.(Insight)
October 1, 2003... Global M&A volume in the third quarter of 2003 registered a sombre US$278.1bn in announced transactions, according to statistics released by Thomson Financial. These results represent a 6% decline from the US$295.9bn in announced deals during...

Piecemeal progress in France: France has seen a number of large-scale deals in recent months but market conditions are still difficult.(Focus on France)
October 1, 2003... A late flurry of big-cap deals last month again put the spotlight on the French M&A market. France often flatters to deceive, however, and the latest announcements, including the largest buyout of the year, follow a flat period. The...

Investing in the regions: even the biggest advisory firms are finding plenty of worthwhile work among French regional companies.(Focus on France)
October 1, 2003... Falling transaction volumes at the top end of the M&A market in recent years means advisers are focusing more energy on mid-market deals. In casting their nets wider more attention is being paid to the small-cap and SME deals that can be found...

Little fizz in Europe: the market is taking longer than expected to recover but the mood of optimism is continuing.(Q3 Review)
October 1, 2003... A glance at the figures suggests little fizz or ferment in European M&A. The total value of deals announced involving European companies in the first three quarters of 2003 was up only 2.2% on last year to US$354bn, while the number of deals...

Synopses of the largest global deals in September 2003.(Market intelligence)
October 1, 2003... US: Manulife Financial Corp (MFC) agreed to merge with John Hancock Financial Services Inc (JHF), an insurance company, in a stock-swap transaction valued at US$11.063bn. MFC offered 1.1853 common shares per JHF share held. Based on MFC's...

When deals work--and why they don't: in the second of a series of articles Michael Cahill, author of the recently published "Analysing Companies & Valuing Shares", writes about making deals work.(Market intelligence)
October 1, 2003... Given the high risks attached to acquisitions and their poor record in adding value, when do they have a good chance of working? Management track record is crucial--a history of not overpaying and a management culture and resource that ensure...

Public-to-private offers have flourished: shareholders are rumbling uneasily that firms are now being snapped up too cheaply.(Market intelligence)
October 1, 2003... Acquisitions Monthly below examines the annual volume, value and premia of public-to-private (PTP) transactions since 2000 to see what has happened. The criteria for inclusion are similar to those for the quarterly bid premium surveys,...

M&A capital markets round-up: Acquisitions Monthly reviews the financing of leading M&A transactions in September, providing details and pricing of deals.(Acquisition Finance)(Mergers and Acquisitions)
October 1, 2003... SEAT Pagine Gialle's record 3.2bn [euro] LBO facility has been launched into general syndication, through mandated lead arrangers and joint bookrunners Barclays, BNP Paribas, CSFB and RBS. Banks have been invited to join as arrangers earning...

Bank of America eyes Europe: Bank of America plans to double European M&A strength as it seeks to remedy a "missing component".(Institutions)
October 1, 2003... Bank of America is planning to double the size of its European M&A team in an attempt both to service US clients and to build a new franchise. The bank has hired Paul Mullins, a former managing director in M&A at Citigroup, as co-head of...

Dawnay, Day moves into media: boutique hires Dolf Campman from WestLB Panmure.(Institutions)
October 1, 2003... UK-based boutique Dawnay, Day Corporate Finance is growing in confidence and is now establishing a media division after hiring Dolf Campman from WestLB Panmure. The firm is firmly upbeat about prospects for the mid-market, "There's no lack...

Fighting for the client: having clocked up nearly 30 years acting for and against unsolicited offers, leading lawyer David Cheyne is something of a specialist in hostile bids. He talks with Neil Sen.(AM Interview)(Interview)
October 1, 2003... The head of the corporate department at law firm Linklaters admits to enjoying a good corporate scrap. "A contested public bid is always entertaining. There is a huge amount of human interest," he beams. This cheerful, buoyant attitude must...

Microsoft: the EU zones in: the jury is out, but it would be a brave soul who bet that Microsoft will remain one company for much of the 21st century.(Legal and Regulatory)
October 1, 2003... At first sight, Microsoft executives should be feeling fairly relaxed about the European Commission's investigation into its commercial practices. After all, the Commission can only fine Microsoft a maximum of 10% of its worldwide turnover....

Year-to-date M&A volume falls.(Legal and Regulatory)(Mergers and Acquisitions)
October 1, 2003... Undeterred by a sluggish world market, legal viser Skadden Arps Slate Meagher & Flom advanced to the top of the worldwide announced rankings after the first three quarters of the year. The cumulative rank value of US$127bn generated by...

Will chemicals come back in the future? There was a time not so many years ago, when mega mergers and acquisitions in the chemical industry were almost in danger of being considered commonplace. Not so today.(Chemicals sector report)
October 1, 2003... "This year to-date it is definitely true that there have been no real mega mergers, and that is true of the past two to three years," says Sybren Brouwer, Dutch chemicals analyst at ABN AMRO in Amsterdam. With a fizzling economy and a slew...

You can get it if you really want it: the lyrics of Jimmy Cliff's 1970 recording sum up the gritty determination of EMI to get its hands on Warner Music labels.(TMT sector report)
October 1, 2003... EMI seized on a decision last month by Warner and BMG, the music publishing arm of Germany's Bertelsmann, to let the exclusivity clause on their merger talks lapse and is understood to have tabled an audacious US$1.6bn bid for Warner Music just...

Manulife merges with John Hancock: the life insurance industry has seen a series of recent mergers with the John Hancock purchase following AXA's intention to acquire MONY and sale of Safeco's life insurance and investment businesses.(FIG sector report)
October 1, 2003... Canadian life insurance finn, Manulife Financial is on the verge of completing the largest takeover in the county's corporate history with the announcement that it has received approval for a US$11bn takeover of US rival John Hancock. Once...

PowerGen in Midland Electricity bid? Energy group PowerGen is poised to make a move on Midlands Electricity after a separate US$1,58bn takeover deal collapsed last month.(Utilities sector report)
October 1, 2003... PowerGen emerged as the likely buyer for the Midlands Electricity distribution business in late September, after Scottish & Southern Energy withdrew its 1.1bn [pounds sterling] (US$1.58bn) bid because it could not secure bondholders' agreement...

Macquarie Bank acquires South East Water: Australia's only listed investment bank has unveiled its Macquarie European Infrastructure Fund and also announced the fund's first investment, the US$715m acquisition of the UK's second biggest water only company.(Utilities sector report)
October 1, 2003... Macquarie Bank Group Australia acquired South East Water (SEW for 426m [pounds sterling] (US$715m) from France's Bouygues art October 1 as the "seed investment" for an 1bn European infrastructure fund it aims to close within the next six...

Moving in the mid-markets: (US$500m-US$30m).
October 1, 2003... Overview Financials was once again the hot mid-market sector this month. One such notable deal was the US$260m acquisition of ABN AMRO's brokerage business in New York by UBS. In Italy, Banca Popolare di Milano acquired a 50% interest in...

Improving deal flow over next two years: British Engineering has not given rise to the spectacular acquisitions seen in continental Europe over the past 18 months--such as France's legrand in July 2002. However, the sector faces strong pressures to consolidate.(moving in the mid-markets)
October 1, 2003... Both investors and advisers are confident that the market will pick up from the low levels of activity seen in the sector during 2002 and the first half of this year, when depressed asset values made companies reluctant to sell. Non-core...

Consolidation leads the way: consolidation is the key word in the automotive sector, with "tier two" component suppliers and the severely fragmented dealership sector coming under the spotlight.(Moving in the mid-markets)
October 1, 2003... As a decrease in consumer spending continues to have an effect on the productivity levels of the large vehicle manufacturers (VMs), the squeeze on the tier-one and tier two automotive suppliers in Europe continues apace. This has translated...

Fast growing companies more successful at acquisitions: Judith McMath, regional managing director of Enterprise Finance Europe, the UK working capital funder, analyses the findings of a research project focusing on the financial challenges facing today's managing directors and CEOS.(Mid-markets column)
October 1, 2003... Like so many before them, this government identified the existence of an "equity gap" for businesses and made enterprise in general and the owner-manager in particular a major focus of its policy. But what are the financial challenges facing...

Behind the buyouts.
October 1, 2003... Overview The battle for Scottish and Newcastle s pubs is over, with the consortium led by Texas Pacific, Blackstone Private Equity and CVC Capital Partners emerging as the victorious bidder. The 1,400 pubs, the last major estate to be put...

Stapling on the debt? Private equity funds are increasingly using stapled financing to squeeze more value at exit.(Private equity column)(stapled financing)
October 1, 2003... In a market with very limited IPO exit options, some private equity investors are using stapled financing to "squeeze" more value from the sale of their portfolio companies. These investors see stapled financing as a mechanism by which they can...

Debenhams take-private heats up.(Behind the buyouts)(Brief Article)
October 1, 2003... The private equity consortium of CVC Europe, Texas Pacific Group (TPG) and Merrill Lynch Global Private Equity sent out offer documents for its 1.664bn [pounds sterling] (US$2.78bn) bid for Debenhams to shareholders of the department store...

Astorg hits first base: Astorg's Xavier Moreno talks to Ben Harding about independence, fundraising and the current institutional appetite for the French mid-market.(Behind the buyouts)
October 1, 2003... The recent 110m [euro] first close for Astorg's latest fund represents a vindication of its desire to seek full independence from its former parent, the giant French industrial conglomerate Suez. Astorg III, as the latest vehicle is known,...

Goldman closes largest ever mezz fund.(Funds)(Brief Article)
October 1, 2003... GS Mezzanine Partners, the latest offering from Goldman Sachs, has closed on US$2.7bn, making it easily the largest ever. The GS Mezzanine Partners III fund is larger than its nearest rival by more than US$1bn and increases the total raised by...

Carlyle to enter the mezz fray.(Funds)(Brief Article)
October 1, 2003... In a further sign of the fizz surrounding mezzanine, the Carlyle Group, one of the world's most prolific investors in private equity, has announced plans to launch a fund that is dedicated to the product. The phenomenon of the...

Mezzanine fund-of-funds.(Funds)(Brief Article)
October 1, 2003... Swiss-based fund-of-fired specialists Golding Capital Partners and VCM Venture Capital have announced the launch of the first ever such product for the mezzanine market. Titled VCM Golding Mezzanine, the vehicle, which is seeking to raise 100m...

100m [euro] first close for Accent.(Funds)(Brief Article)
October 1, 2003... Accent Equity Partners, the private equity firm born out of the marriage between Nordico and Euroventures, has so far raised 100m [euro]. Launched after the merger in April 2003, the firm hopes to raise a total of 200m [euro to 300m [euro for...

Astorg.(Funds)(Brief Article)
October 1, 2003... Astorg Partners has announced the first close of its Astorg III fund at 110m [euro], which represents nearly 40% of Astorg III's final target of 300m [euro]. Astorg Partners has also gathered significant additional commitments contingent only...

Towards a leveraged market: a glut of large telecom deals has raised the profile of buyouts in Central and Eastern Europe. Many of these deals attracted debt financing from Western European sources.(Central Europe)
October 1, 2003... Over the last 18 months, the development of a leveraged buyout market in Central and Eastern Europe has finally begun to look like a feasible proposition, but there are still major hurdles to be overcome. At the moment, we are at the stage...

Central Europe enjoys M&A growth: what current trends are discernible? Who are the leading players in the Central and Eastern European marketplace? Keith Boyfield reports from Vienna and Budapest for Acquisitions Monthly.(Central Europe)
October 1, 2003... Compared with Western Europe, Central and Eastern European (CEE) countries economies are enjoying a far higher level of growth. Over the last few years, despite the economic downturn within Europe, the CEE "economies did extremely well", notes...

Meals and appetites: Simon Walsh reviews ... the Curzon Restaurant & Bar.(Meals and Appetites)(Restaurant Review)
October 1, 2003... A brave boast this summer was the opening of "the best and most authentic Italian restaurant in London". I say brave because that's quite an achievement. We are fairly lucky when it comes to Italian food in the capital. There's a clutch of...

Islington restaurant Granita.(News & Views)(Brief Article)
October 1, 2003... * Islington restaurant Granita (of the eponymous Blair-Brown leadership "Pact") has closed.

Marcus Wareing has now opened the new Petrus.(News & Views)
October 1, 2003... * Marcus Wareing has flow opened the new Petrus in the Berkeley Hotel.

Back to the city: Conran is celebrating a summer in the Royal Exchange's redundant floorspace with a courtyard cafe and first-floor bar.(News & Views)
October 1, 2003... * Back to the city: Conran is celebrating a summer in the Royal Exchange's redundant floorspace with a courtyard cafe and first-floor bar. Simple but elegant fare with an accent on seafood indicates they've got it right again.

Simpson's in-the-Strand is celebrating its 175th birthday with exclusive "Cuvee Simpson's wines from France and Spain.(News & Views)(Brief Article)
October 1, 2003... * Simpson's in-the-Strand is celebrating its 175th birthday with exclusive "Cuvee Simpson's wines from France and Spain; they are also used in the "Aniversary Menu" featuring roast rib of beef for 38 [pounds sterling], all-in. Simpson's, Tel....

M&A deal data.
October 1, 2003... M&A deal data Benelux Target Bidder ChemGas BV-European Activities Reederei Jaegers GmbH (GM) - (NE) - Chemical gas Shipping company transportation services Sales ($): n/a...

Monthly sector analysis.(Monthly sector analysis)
October 1, 2003... THIS SECTOR ANALYSIS INCLUDES ACQUISITIONS AND BUYOUTS ANNOUNCED DURING SEPTEMBER. UK PUBLIC OFFERS COMPLETED BETWEEN THESE DATES ARE INCLUDED, WHEREAS NEW AND PENDING OFFERS ARE EXCLUDED. THE TRANSACTIONS ARE CLASSIFIED ACCORDING TO THE US SIC...

About Deloitte.(Sponsored Profile)(Brief Article)
October 1, 2003... The ultimate test of success for a merger, acquisition or disposal is its impact on shareholder value. There is an increasing view that M&A transactions do not always deliver their promised benefit, and the global economic slowdown, corporate...

Marsh.(Sponsored Profile)(Company Profile)
October 1, 2003... The Private Equity and M&A Practice of Marsh targets concerns that impact deal negotiations and the long term success of a transaction. The Private Equity and M&A team work alongside the appointed accounting and legal teams to design and...

Transaction support by Enviros Consulting Ltd and the CAT Alliance Ltd.(Sponsored Profile)
October 1, 2003... Know the Risk in Advance Enviros and the CAT Alliance provide a network of offices in 25 countries and partners in a further 30 to deliver cross-border transaction advice to corporate clients, financial institutions and private equity,...

Tailoring due diligence to the deal: due diligence is an evolving practice and in today's uncertain economic climate advisers are having to tackle new challenges.(Financial due diligence)
October 1, 2003... Many advisers argue that the process is becoming more complex but at the same time more flexible, as clients demand less backward-looking number-crunching and more analysis of key issues for the future. This is an important area because,...

Views on how to improve due diligence: "could you suggest what steps you would take to improve the process of due diligence and, ultimately, the success of a deal?".(Viewpoints)
October 1, 2003... "The key to the successful delivery of environmental due diligence lies with the consultant understanding the context of the deal, and being given enough time to scope the due diligence to meet the specific requirements of the client, and the...

Scoping the right due diligence--the key to a successful deal: Lionel Young, Head of Corporate Transaction Services at Deloitte, is constantly surprised by the lack of understanding as to how to scope due diligence to be effective. Here he explains what it is about due diligence that is crucial in a transaction.(Sponsored Article)
October 1, 2003... It is alarming how many investors still regard due diligence as an exercise carried out by a team of box-ticking accountants as a way of minding their backs, or to ensure a tick in the box that indicates that due process has been followed....

M&A insurance to the fore: increasingly, M&A professionals are looking to the risk management community to help guard against unexpected occurrences that could scupper a successful transaction.(Risk insurance)(Mergers and Acquisitions )
October 1, 2003... "We've become much more conscious of insurance services being a crucial element in many deals," observes Rudolf Kinsky, head of 3i's buyout practice in German-speaking Europe. M&A transaction insurance is primarily focused on warranty and...

Transactional risk--an integrated paradigm for dealing with M&A risk: the past two years have witnessed a growth in use by both corporates and strategic investors of unsecured insurance capital to assist them in the efficient execution of M&A transactions.(Sponsored Article)
October 1, 2003... Whilst the awareness of specific approaches to using insurance in M&A deals is far from new, what has increased is a move by stakeholders towards using a co-ordinated and multi-faceted approach to engaging risk management advice and ultimately...

Growth of environmental due diligence: environmental due diligence has become a crucial part of the transaction process and has widened in scope as clients require a broader approach to risk assessment and risk management.(Environmental due diligence)
October 1, 2003... In the last few years, as the environment has occupied a prominent and growing space on governments' and institutions' agendas, rules and regulations have become more stringent while legislative controls at both the national and European levels...

Environmental due diligence added value in transactions and asset management: it is essential that environmental due diligence is introduced early in the M&A process and tailored to the particular transaction in order that material liabilities can be identified.(Sponsored Article)
October 1, 2003... Introduction In the eighties and early nineties the mergers and acquisitions (M&A) process was usually limited to the review of financial, legal and commercial issues relating to a specific target company. This was undertaken in order to...

The importance of cultural due diligence: integrating an acquisition is hard work and should not be taken for granted.(Cultural due diligence)
October 1, 2003... Most people who have experienced a takeover or a merger, whether working in an investment bank, a drug company or a law firm, tend to recount a painful process of integration that, despite the pain, often fails to deliver much of the...

Achieving sustained value: deal-making remains the key driver for M&A, not the delivery of lasting value through successful integration.(Cultural due diligence)(Mergers and Acquisitions )(Column)
October 1, 2003... In April this year Acquisitions Monthly kindly invited me to the journal's ceremony for their 2062 awards. The crush bar at Covent Garden was packed with all the great advisers on M&A--the accountants, the lawyers and the corporate financiers....

Case studies: we asked practitioners to highlight deals that they have worked on recently in which due diligence played a major role or altered the course of the transaction.
October 1, 2003... We all have war stories of due diligence turning up issues with a significant impact upon the deal--whether by altering the price, varying the transaction details or in fact simply bringing negotiations to an end. There will also be occasions...