Acquisitions Monthly articles from September 2007

Acquisitions Monthly archives from September 2007

Nominate your M&A deals and your firm for awards.(AWARDS PROCESS)
September 1, 2007... Acquisitions Monthly magazine encourages firms to make submissions for the 2008 Acquisition Monthly Awards for M&A and buyout work completed during 2007. The winners will be influenced primarily by the range of submissions, our own...

Changing times.(Germany report)
September 1, 2007... [ILLUSTRATION OMITTED] German dealmakers face opportunities and challenges as key industries consolidate. Private equity is increaslingly targeting Germany's family-run companies--the mainstay of the country's economy--but it is still...

Sub-prime contagion infects global M&A: the credit crisis precipitated by the meltdown in the US sub-prime mortgage market has had a rapid and severe impact on global M&A activity. Sponsors of leveraged buyouts have found that sources of cheap debt--so plentiful up to June--have dried up, while investment banks have struggled to offload the short-term commitments they have underwritten.(LEAD FEATURE)
September 1, 2007... [ILLUSTRATION OMITTED] By the beginning of August, there was estimated to be about US$400bn of debt for cash-financed LBOs and MBOs sitting on bank balance sheets. The lending institutions that put up these facilities did so in the belief...

Dealmakers assess market earthquake: the M&A boom could revive despite the seismic shift in market sentiment that has hit deals lately.(LEAD FEATURE)
September 1, 2007... [ILLUSTRATION OMITTED] The current crisis in the credit markets stems from several sources. "Subprime" lending is foremost amongst them. But dealmakers are increasingly asking why the unwise provision of home loans to people with poor...

August snapshot: synopses of the largest global deals announced last month.(MARKET INTELLIGENCE)
September 1, 2007... US: Fiserv has agreed to acquire all the outstanding common stock of CheckFree Corp, a provider of electronic billing services, for US$48 in cash per share or a total value of US$4.29bn. The transaction was subject to shareholder and regulatory...

Premia and the underperformance puzzle: in the largest study of its kind, Cass Business School studies the impact merger premia have on the post-merger underperformance of UK public acquirers.(MARKET INTELLIGENCE)
September 1, 2007... There has been much research into the underperformance of acquiring companies post-merger as well as an increasing view that the underperformance could be attributable to overpayments on transactions. A recent study carried out by Cass...

Emerging markets provide telecoms buzz: acquirers in the telecoms sector are looking at riskier territories, such as Africa, to secure faster growth.(SECTOR REPORTS: SPECIAL FOCUS ON TELECOMS)
September 1, 2007... This year is developing into one of contrasting halves for telecom mergers and acquisitions. In the first six months, the largest deals involved financial buyers taking over maturing businesses in the West. But advisers are expecting the focus...

Kaupthing's marriage of convenience: the Icelandic bank's US$4bn purchase of Benelux lender NIBC helps solve conundrums for both companies.(SECTOR REPORTS: FOCUS ON FIG)
September 1, 2007... Dutch bank NIBC has temporarily stolen the limelight from compatriot ABN Amro, after agreeing to a 2.99bn [euro] (US$4.04bn) offer from Icelandic lender Kaupthing. Both parties in this transaction have proved of interest to sector followers in...

NCB seals largest-ever Islamic banking deal: National Commercial Bank paid a record book-to-value figure for Turkiye Finans to position itself in the fast growing Turkish Islamic banking sector. Did it overpay?(SECTOR REPORTS: FOCUS ON FIG)
September 1, 2007... Saudi Arabia's National Commercial Bank (NCB) grabbed the headlines back in July with the biggest ever purchase of an Islamic bank--60% of Turkiye Finans. It was also the bank's first major foray outside Saudi Arabia's borders. On the...

Hard sell down the river: the Macquarie-led Kemble consortium that paid 8bn [pounds sterling] (US$16bn) for Thames Water last year has had an uphill struggle to refinance the debt it raised for the acquisition.(SECTOR REPORTS: FOCUS ON UTILITIES)
September 1, 2007... The cornerstone of the refinancing--up to 4bn [pounds sterling] (US$8bn) of long-term, securitisation-type bonds--fell foul of the deterioration in the capital markets from mid-July. The five banks arranging the deal--Macquarie, HSBC, Barclays,...

Sarkozy strikes a blow at open markets: EU competition law has not just broken up cartels and dealt with mergers. Throughout its almost 50-year history competition law has also been deployed to open up markets and crack down on state subsidies.(LEGAL & REGULATORY)
September 1, 2007... Following the negotiations on the EU Reform Treat in June, President Nicolas Sarkozy in a significant coup managed to delete the key competition principle from the new Treaty. Unless other EU governments step up to the plate at the final treaty...

Heard on the grapevine: insider trading thrives on M&A boom: insider trading is rife. There's plenty of evidence of suspicious trading ahead of M&A announcements and although it can't be stamped out, there's no reason to be complacent about it.(LEGAL & REGULATORY)
September 1, 2007... [ILLUSTRATION OMITTED] Insider trading is an easy crime to commit for those in the know. Various pieces of research appear to demonstrate that perpetrators are seldom caught. And even when suspected of insider trading, proving it in a...

CIT takes Pulse of market: (US$500m-US$30m): financing might currently prove problematic for larger deals, but mid market transactions remain viable.(MOVING IN THE MID-MARKETS)
September 1, 2007... The private equity purchase of London listed Alba's Pulse Home Products division never looked like being an easy deal to pull off. In mid July the parent company, which makes a variety of budget electrical consumer goods, reported a 44m [pounds...

Cycle ride: technology M&A may have passed its peak, but any trip downwards should be a gentler journey than last time.(MOVING IN THE MID-MARKETS: FOCUS ON TECHNOLOGY)
September 1, 2007... [ILLUSTRATION OMITTED] Competition for technology acquisitions can be pretty intense--and can come from surprising sources. When Kennet, a small technology venture capital fund based in London and Silicon Valley, lost out in the race to...

Crunch time at the gym: problems at Esporta show that property investors need to think carefully before buying into the fitness and health clubs sector.(MOVING IN THE MID-MARKETS)
September 1, 2007... Over the past few years, the health and fitness sector has changed dramatically in terms of ownership, with a swathe of private equity investors bulking up on gym chains before selling out to increasingly muscular property and trade buyers. ...

Battle for talent is tight: corporate finance departments are selectively recruiting but finding it hard to find dealmakers to move at present.(INSTITUTIONS)
September 1, 2007... [ILLUSTRATION OMITTED] Head-hunters are finding it hard to persuade top dealmakers to move jobs in the current climate. However, the current credit problems have little to do with this state of affairs. Instead, the boom in M&A work during...

Recent people moves within European coporate finance.(INSTITUTIONS)
September 1, 2007... RECENT PEOPLE MOVES WITHIN EUROPEAN COPORATE FINANCE (Q2 2007) Name Title Moved to Moved from John Carrington Advisor Alegro Capital Cellnet Mark Goldstein MD, co-Head of...

Risk for hire: private equity has increasingly lured star talent from the public markets, but has a higher profile and the threat of increased regulation dented their ambition?(INSTITUTIONS)
September 1, 2007... [ILLUSTRATION OMITTED] As private equity's influence swells, so does its ranks. Increased fund sizes and ever-larger targets have required greater manpower and more pressure on recruiting the right talent to continue managing expanding...

The specialist: consultancy M&A is heating up, with private equity interested and US buyers scouring the UK for targets. Paul Collins, founder of adviser Equiteq, tells Tim Burke why the market is so busy--and why he doesn't offer advice on any other sector.(INSTITUTIONS)
September 1, 2007... [ILLUSTRATION OMITTED] There's a world of difference between selling business consultancy and battered cod, and Paul Collins has little time for M&A advisers who take pride in their lack of sector specialisation. "Yesterday, they could...

For better or for worse: working with private equity: private equity can be a collaborator, a means to an end or a potential lifeline in this uncertain market.(BEHIND THE BUYOUTS: PRIVATE EQUITY COLUMN)
September 1, 2007... No-one is breathing a sigh of relief just yet, but there is continued optimism that the global stock markets are rallying after a few weeks of continued battering. Whether we have just witnessed what might be termed a 'healthy correction' or...

Investing in talent: recruitment firms may have profited from the burgeoning private equity industry's need for talent, but the relationship is not just one way. Robert Venes looks at financial investors seeking returns on the firms themselves.(BEHIND THE BUYOUTS)
September 1, 2007... According to IE Consulting, a private equity-focused consultancy firm, UK private equity deals in the recruitment sector totalled more than 266m [pounds sterling] in 2006, more than 10 times the total for 2005. In the past year, Baird...

Liberty Global puts Virgin Media top of potential buys.(BEHIND THE BUYOUTS)
September 1, 2007... Liberty Global, a US-headquartered global broadband cable operator, has admitted it is interested in the delayed sale of Virgin Media as it has about US$5bn of liquidity available for purchases. Liberty's Mike Fries said in a conference...

Lion Capital buys Nidan Soki.(BEHIND THE BUYOUTS)
September 1, 2007... US private equity Lion Capital, which owns Orangina, announced that it is buying Russia's fourth largest juice producer, Nidan Soki, valued at some US$500m. This is Russia's biggest foreign LBO to date. The Moscow-based Russian company...

Tesco wins Dobbies.(BEHIND THE BUYOUTS)
September 1, 2007... Supermarket chain Tesco has declared its 155.6m [pounds sterling] (US$309m) acquisition of Dobbies Garden Centre unconditional after securing more than the necessary 50% of shareholder votes. Tesco received acceptances for 23.5% of Dobbies...

Dover to guide TPG on Jaguar offer.(BEHIND THE BUYOUTS)
September 1, 2007... [ILLUSTRATION OMITTED] Bob Dover, former chief executive of automotive group Ford's Jaguar and Land Rover brands, is understood to be advising private equity firm TPG Capital on a possible bid for the businesses. Dover isn't the only...

Carlyle and Advent sell German plastics.(BEHIND THE BUYOUTS)
September 1, 2007... International private equity firms Carlyle Group and Advent International have sold HT Troplast, a Germany-based plastics manufacturer, in a secondary buyout to Bahrain-based investor Arcapita. Terms were not disclosed for the transaction....

Mecom gets second extension for Wegener offer.(BEHIND THE BUYOUTS)
September 1, 2007... Mecom, the listed investment vehicle of former Mirror Group chief executive David Montgomery, has again been granted an extension for its offer for Dutch newspaper publisher Koninklijke Wegener. AFM, the Netherlands Authority for the...

Eurazeo.(M&A capital markets review)
September 1, 2007... French private equity firm Eurazeo last month agreed a deal to buy ELIS, a France based supplier of workwear and linen rental and hygiene services. The business has an enterprise value of 2.28bn [euro], which will include a 500m [euro] equity...

Applus.(M&A capital markets review)
September 1, 2007... The loan backing the buyout of Applus by Carlyle Group for 1.48bn [euro] has been mandated to Barclays Capital, Calyon, Caja Madrid, SG and ICG. Caixa Catalunya will be taking a 25% stake in Applus and will lead a group of institutional...

Scandlines.(M&A capital markets review)
September 1, 2007... The eight-year 1.5bn [euro] loan backing the acquisition of the Scandlines ferry business by Allianz SE, a consortium formed of Allianz Capital Partners, 3i and Deutsche Seereederei (DSR), has been launched to a small group of sub-underwriters....

CBR Holdings.(M&A capital markets review)
September 1, 2007... CBR Holdings has asked lenders to respond to a request for a pricing and structural flex on its 1.25bn [euro] debt facility. The facility is mandated to HVB and RBS. Calyon, Dresdner Kleinwort, Mizuho, NordLB, Nykredit and WestLB joined as...

Camaieu.(M&A capital markets review)
September 1, 2007... The c. 1.45bn loan backing Cinven's buy-out of French clothing retailer Camaieu, with Calyon, BNP Paribas and RBS as mandated lead arrangers, may go into a second phase of syndication for its senior and second lien tranches, though the residual...

Zodiac Marine.(M&A capital markets review)
September 1, 2007... ING as mandated lead arranger and bookrunner has completed the 1.18bn [euro] debt package supporting Carlyle's buyout of Zodiac Marine, a pool care product company. In keeping with the poor market theme, the deal required an upward flex on the...

Avanza Group.(M&A capital markets review)
September 1, 2007... The 495m [euro] loan backing the acquistion of Avanza Group by Doughty Hanson, mandated to UniCredit (HVB) as mandated lead arranger and sole bookrunner has closed. Banco Santander and Mizuho joined as mandated lead arrangers ahead of the...

ONE.(M&A capital markets review)
September 1, 2007... The circa 1bn [euro] loan backing the 1.4bn [euro] buy-out of ONE. the third mobile operator in Austria, by private equity group Mid Europa and France Telecom is close to mandate, with Morgan Stanley, SG and RBS thought to be close to the deal....

Maxeda.(M&A capital markets review)
September 1, 2007... Mandated lead arrangers ABN AMRO and Citi Group bowed to investor pressure last week and strengthened the covenant package of the 1.1bn [euro] loan package supporting the buyout of Maxeda. KKR, Permira and Cinven are sponsors. The arrangers...

Mauser.(M&A capital markets review)
September 1, 2007... The 825m [euro] loan backing the buyout of Mauser has closed with oversubscriptions on the fund and second lien tranches. The facility, which is mandated to Barclays and Citi, also has a toggle element, which remains in place. Despite the...

Lloyds TSB Registrars.(M&A capital markets review)
September 1, 2007... Lehman Brothers and Lloyds TSB have flexed upwards financing for Advent's 580m [euro] buyout of Lloyds TSB Registrars. The price flex see the margin on the term loan B increased to 250bp over Libor from 225bp and the margin on the term loan C...

Exterran.(M&A capital markets review)
September 1, 2007... Exterran has wrapped up a US$1.65bn senior secured credit facility via Wachovia and JPMorgan. The deal comprises a US$850m five-year revolver and a US$800m six-year term loan. In addition, the company completed a US$1bn asset-backed...

Enterprise Media Group.(M&A capital markets review)
September 1, 2007... Enterprise Media Group (EMG) has completed a US$137m credit facility to back its acquisition of Ziff Davis Media's Enterprise Group. EMG is an Insight Venture Partners' portfolio company. It will be combined with Developer Shed, another Insight...

Brake Bros.(M&A capital markets review)
September 1, 2007... Barclays has been mandated as sole mandated lead arranger and bookrunner on the loan backing the buyout of Brake Bros by Bain Capital. Bain is reported to be paying Clayton Dubilier & Rice around 1.3bn [pounds sterling] for the UK food service...

Bupa's hospitals.(M&A capital markets review)
September 1, 2007... The circa 1.1bn [pounds sterling] loan backing the buyout of Bupa's hospitals by Cinven has been mandated to RBS. Cinven is paying 1.44bn [pounds sterling] for the assets. The loan will have around 300m [pounds sterling] of opco and 800m...

Imperial Tobacco and Rio Tinto closed their multi-billion jumbo acquisition loans last month.(M&A capital markets review)
September 1, 2007... Imperial Tobacco and Rio Tinto closed their multi-billion jumbo acquisition loans last month. Both the 9.2bn [pounds sterling]-equivalent loan from Imperial supporting its acquisition of Altadis, and Rio's US$40bn line funding its takeover...

Polish M&A laws on EU convergence path: Poland's legal system basically resembles that of any Continental European country, largely due to EU rules. However, a bizarre wage-capping proposal by the country's twin rulers could crimp M&A activity.(REGIONAL REPORT: POLAND)
September 1, 2007... [ILLUSTRATION OMITTED] It appears that twin brothers Lech and Jaroslaw Kaczynski, who run Poland as President and Prime Minister, object to the level of fees earned by lawyers--often equivalent to 300 [pounds sterling] an hour. They would...

India Inc: coming of age: the Indian M&A boom witnessed in 2006 left many thinking there would be a slowdown in 2007, but the results of the first half proved them wrong.(FEATURE: INDIA)
September 1, 2007... India's growth story continues to attract overseas investors and has also paved the way for Indian corporates to execute global strategies by acquiring companies both within and outside India, not only to remain competitive but also to achieve...

M&A deal data.(Company overview)
September 1, 2007... This country analysis included acquisitions and buyouts announced between 19 July 2007 and 19 August 2007. Benelux Target Bidder Artwork Systems Group NV (BL) Kirkbi A/S (DN)--Provide...

Changing times: German dealmakers face opportunities and challenges as key industries consolidate.(OVERVIEW)(Cover story)
September 1, 2007... [ILLUSTRATION OMITTED] One telling transaction typifies the issues faced by dealmakers in I Germany during 2007. The sale of German automotive group DaimlerChrysler's US Chrysler division illustrates several trends-good and bad --that have...

Bank of Ireland acquisition finance.(SPONSOR'S PROFILE)
September 1, 2007... [ILLUSTRATION OMITTED] The Bank of Ire land Acquisition Finance unit was established in 1996 and has dedicated private equity sponsor coverage teams located in Dublin, London, Paris, Frankfurt, Stamford Connecticut and Los Angeles. The...

The rise and rise of secondary buyouts: Ralph Betz, Director, Bank of Ireland, Acquisition Finance--Germany, discusses the popularity of secondary buyouts and why they make sense for both vendors and purchasers.(SPONSOR'S ARTICLE: BANK OF IRELAND ACQUISITION FINANCE)
September 1, 2007... Historically a trade sale or--depending on deal size and the state of the public markets--an IPO were the classic exit routes typically followed by private equity investors in the European LBO market. However, in recent years, the popularity of...

Mittelstand makes waves: private equity is increasingly targeting Germany's family-run companies--the mainstay of the country's economy--but it is still trade players that rule the roost.(MITTELSTAND)
September 1, 2007... [ILLUSTRATION OMITTED] Politicians in Germany might criticise private equity because the industry is--well--private, and as such non-transparent, but so too are most of Germany's companies. They are the Mittelstand--sometimes described...

Fresh perspectives: PricewaterhouseCoopers.(SPONSOR'S PROFILE)
September 1, 2007... [ILLUSTRATION OMITTED] Germany is booming again--and today this applies not only to the economy but to the M&A business, as the Transactions specialists at PricewaterhouseCoopers (PwC) can testify. "Certainly, no-one can call Germany...

Private equity--meeting the market challenges: Richard Burton, PricewaterhouseCoopers' private equity leader in Germany and continental Europe, gives his views on the trends in the German private equity market and the related implications for private equity funds and their advisers.(SPONSOR'S ARTICLE: PRICEWATERHOUSECOOPERS)(Company overview)
September 1, 2007... After more than a decade of growing pains, the private equity market in Germany has finally 'come of age'. Where only 30 to 40 leveraged outs (LBOs) were completed annually in the early years of the new millennium (and a lot fewer still in the...

Banks supporting corporates and sponsors: the global credit downturn has resulted in a significant fall in secondary asset prices and institutional investor liquidity. The primary market is increasingly reliant on the continued support of bank participants.(LEVERAGED BUYOUTS)
September 1, 2007... [ILLUSTRATION OMITTED] The recent crisis engulfing sub-prime mortgages in the US has had major implications for many markets already. For private equity, the question is whether the crisis will hasten the end of the leveraged buyout as we...

Leveraged Finance at Commerzbank Corporate & Markets.(SPONSOR'S PROFILE: COMMERZBANK CORPORATES & MARKETS)(Company overview)
September 1, 2007... The Leveraged Finance Group at Commerzbank Corporates & Markets (CBCM) was established in 1998. The team is based across two locations--Frankfurt and London--and as a group has a wealth of experience in Germany and across Europe including the...

Building a solid foundation: Christopher Day, head of Leveraged Finance at Commerzbank looks at leveraged finance and discusses how product innovation and integrated financial solutions build solid foundations in the German marketplace.(SPONSOR'S ARTICLE: COMMERZBANK CORPORATES & MARKETS)(Company overview)
September 1, 2007... It is no secret that the foundation of the German economy is made up of thousands of small and medium-sized companies (SMEs), known as the 'Mittelstand'. Many of these enjoy the position of world market leaders in their respective market...

Living with the locusts: locusts may still play a major role in the private equity debate in Germany, but the country's buyout market has moved on apace in the last two years.(GERMAN PRIVATE EQUITY)
September 1, 2007... [ILLUSTRATION OMITTED] When it comes to private equity in Germany, it is hard to avoid the subject of locusts. Back in April 2005, Franz Muntefering, Germany's deputy chancellor and former head of the SDP party, created an iconic image for...

Banking on consolidation: the owners of Germany's WestLB are continuing to examine all alternatives for the bank.(FOCUS ON FIG)
September 1, 2007... North Rhine-Westphalia, Germany's most populous state, has announced that a decision on the future of WestLB, the country's third biggest state-owned lender, could be made before the end of the third quarter. The state holds approximately...

Germany revs up for more car deals: the return of private equity and Porsche's strategic investment in Volkswagen are likely to kick-start a new wave of deals in the German car market.(FOCUS ON AUTOMOBILES)
September 1, 2007... Vorsprung durch technik ('progress through technology') has been Audi's company motto since the early 1980s and for the last few years, interest in the German automotive market has largely come in the technology and components sub-sectors...

Power plays: renewable energy is proving a popular focus for utilities deal making.(FOCUS ON UTILITIES)
September 1, 2007... German electricity and gas group E.ON has been busy since losing out in its long-running attempt to buy Spanish utility Endesa. Among key moves to shift its corporate structure, the group has initiated an 18-month, 7bn [euro] (US$9.6bn) share...

Screen grabs: broadcaster ProSiebenSat.1 is at the centre of recent media deal activity in Germany as the group strives to rival Bertelsmann's own RTL.(FOCUS ON MEDIA)
September 1, 2007... [ILLUSTRATION OMITTED] ProSiebenSat.1 Media, the German media conglomerate behind almost 50 commercial and pay-TV European broadcasters, has been a perennial player in the nation's deal-making scene during recent months, as an acquirer,...

Consolidating broadband in Germany: Freenet's broadband division is likely to attract takeover interest from United Internet, Accor, Hansenet and Versatel following the German TMT players decision to pursue a break-up.(FOCUS ON TELECOMS)
September 1, 2007... Freenet, the German IT and mobile telephony company, is in initial talks with interested buyers, according to Eckhard Spoerr, its chief executive. Spoerr had said he would like to prevent a break-up of Freenet, which only recently was put...

Chemical reactions: Germany's chemicals giants are still making moves on the M&A front.(FOCUS ON CHEMICALS)
September 1, 2007... [ILLUSTRATION OMITTED] Germany's chemicals industry has proved quieter than during 2006, when Bayer grabbed the headlines with its US$17bn (12.3bn [euro]) acquisition of domestic peer Schering. Nevertheless, the country's many key players...

Solid structure: HeidelbergCement's M&A strategy is helping the building materials group transform.(FOCUS ON BUILDING MATERIALS)
September 1, 2007... [ILLUSTRATION OMITTED] News that German building materials group HeidelbergCement was considering an 8bn [pounds sterling] (US$16.2bn) offer for UK rival Hanson in May caused quite a stir, to the extent that Hanson issued a stock exchange...

Behind the headlines: viewpoints: acquisitions Monthly asked German dealmakers to detail a transaction they worked on during the past year, explaining why the deal was notable, what challenges were overcome and what trends it illustrates in its wider markets.(CASE STUDIES)
September 1, 2007... [ILLUSTRATION OMITTED] Klaus Riehmer, a partner at law firm Cleary Gottlieb, looks at savings bank group DSVG's acquisition of a stake in Landesbank Berlin. "The sale of Landesbank Berlin Holding was certainly among the transactions...

Barclays back on track with Global Refund: Barclays Private Equity bolsters record in ever more competitive financial services sector.(BEHIND THE BUYOUTS)
September 1, 2007... Barclays Private Equity, the pan-European mid-market private equity arm of the UK bank, has strengthened its track record in the financial services sector with the agreed acquisition of Global Refund through a secondary management buyout of the...