M&A daily wrap: AlixPartners, Innovation Works, TPG, Anastasia Beverly Hills, self-driving cars, robotics
Self-driving and electric cars are fueling activity in the booming auto sector, according to an AlixPartners study. By 2023, about $255 billion will be spent on research and development and capital expenditures to build electric cars. Self-driving cars will account for 3 million auto sales by 2030. On the M&A side, about 55 percent of automotive deals between 2016 and 2017 were electric and self-driving related. “A pile-up of epic proportions awaits this industry as hundreds of players are spending hundreds of billions of dollars on electric and autonomous technologies as they rush to stake a claim on the biggest change to hit this industry in a hundred years," says AlixPartners global vice chairman John Hoffecker. "The winners in this free-for-all will be those who have the right strategies and, equally important, execute on those strategies to their fullest potential, as billions will be lost by many." Check out our slideshow on auto deals: Car parts makers fuel M&A, as industry readies for self-driving vehicles. Highlights include: Intel bought Mobileye, and Delphi bought nuTonomy. Meanwhile, private equity firms, including Clearlake, CenterOak Partners and Wabash National, are scooping up all sorts of car-related companies from parts makers to service providers.
Robots, once the stuff of science fiction, have become big business. Fewer places have been as instrumental in the development of robots as Pittsburgh, home to Carnegie Mellon University and its Robotics Institute, founded in 1979. One of the companies at the forefront of the community is Innovation Works, a venture capital firm that has backed a wide away of high-tech startups, including: Bossa Nova Robotics, Civic Science, JazzHR, Wombat Security and 4Moms. Exits have included: Modcloth (acquired by Walmart), NoWait (acquired by Yelp) and Vivisimo (acquired by IBM). IW and CMU recently teamed up to host the 1st Annual AI/Robotics Venture Fair. The event showcased 20 of the area’s artificial intelligence and robotics developers and attracted more than 100 investors. It was held at IW’s headquarters in Nova Place, a multi-million dollar urban redevelopment of the former Allegheny Center Pittsburgh. Rich Lunak, the president and CEO of IW and a graduate of CMU, joined the firm in 2005 after a storied career as an entrepreneur and executive. He helped grow Automated Healthcare, a company that pioneered the use of robots to dispense drugs in hospitals, from a three-person shop into a $65 million acquisition by McKesson Corp. (NYSE: MCK). After the sale, Lunak served as group president of McKesson Automation for a decade. Eventually, Francisco Partners bought McKesson Automation and renamed it Aesynt (pronounced ascent), and then Omnicell Inc. (Nasdaq: OMCL) bought Aesynt for $275 million in 2016. Mergers & Acquisitions asked Lunak to share his perspective on the investment opportunities for middle-market dealmakers in robotics. Read our Q&A: Robotics developers are ripe for investment, says Innovation Works CEO Rich Lunak.
TPG Capital has agreed to buy a minority stake in beauty company Anastasia Beverly Hills, a maker of beauty products for eyes, face and lips. The investment will help the target grow globally and through e-commerce. Imperial Capital, Kirkland & Ellis are advising Anastasia. Goldman Sachs & Co. (NYSE: GS), RBC Capital Markets, UBS Investment Bank, and Deutsche Bank are advising TPG and are providing financing. Ropes & gray is representing TPG.
The Blackstone Group LP (NYSE: BX) has agreed to buy PSAV, a creator of event experiences, from Goldman Sachs and Olympus Partners. PSAV provides creative, production, staging and technology services to help event planners. J.P. Morgan (NYSE: JPM), Goldman Sachs, Morgan Stanley (NYSE: MS) and Weil, Gotshal & Manges LLP are advising PSAV. AGM Partners, Barclays, Credit Suisse, Moelis & Co. (NYSE: MC) and Simpson Thacher & Bartlett LLP are advising Blackstone.
PayPal's next phase as its relationship with eBay fades will require a focus on grabbing a greater share of business from online marketplaces and contract workers, two quickly expanding parts of the global economy. Read the full story: PayPal to buy Hyperwallet in an aggressive move for post-eBay growth.
PayPal's $400 million deal to acquire Hyperwallet will give it a readymade base of technology and relationships that can serve both of those segments.
BC Partners and GIC-backed data provider Acuris has bought SparkSpread, an online news service that covers M&A and financing in the energy sector. Ernst & Young advised SparkSpread.
P. H. Glatfelter Co. has acquired Georgia-Pacific Steinfurt GmbH, the European nonwovens business subsidiary of Georgia-Pacific, for $185 million. Shearman & Sterling advised the buyer.
Mark Ties has been promoted from COO/CFO to CEO at Clearlake-backed software company Perforce Software. Mike Goergen was hired as Peforce's CFO. Goergen was most recently the CEO at Digi International.
"Clamoring to be the loudest person in the room” is not the way to bring more women into the middle market, says Suzie Doran of SingerLewak, in this video interview shot at ACG InterGrowth 2018. Doran serves as president of ACG Los Angeles, which recently took the Women of ACG Los Angeles on a private viewing of the 100th Anniversary Exhibition of King Tut at the California Science Center. “We're about making connections and being able to take those connections to the next level.” Watch the full video: No “clamoring to be the loudest person in the room” at women dealmaker events.
More than 2,000 dealmakers from 1,100 companies, representing 16 countries, headed to sunny San Diego for three days of networking at ACG InterGrowth 2018. Jeff Immelt, who served as CEO and chairman of General Electric Co. (NYSE: GE) from 2001 to 2017, was the keynote speaker. Check out our slideshow: InterGrowth 2018 in pictures.
Peter Van Raalte, co-founder of Corinthian Capital, and Mary Kathleen Flynn, editor-in-chief of Mergers & Acquisitions, were featured speakers at the ACG NY Industrial Conference at the New York Athletic Club. The conference is part of the ACG Northeast Industry Tour, sponsored by ACG New York, ACG Boston and ACG Philadelphia. View our slideshow: Manufacturing M&A: high prices but plenty of opportunities.
From stories of star athletes Arnold Palmer, Keith Hernandez and Tiger Woods to advice from entrepreneurs Bridgewater Associates’ Ray Dalio, KPCB’s John Doerr, Nike’s Phil Knight and Brava Investments’ Nathalie Molina Niño, plus strategies to help business leaders in general, and female dealmakers in particular, the 15 books on Mergers & Acquisitions’ summer reading list entertain, instruct and inspire. Check out our listicle: Dealmaker’s guide to summer reading: 15 new books.
Read full coverage of Mergers & Acquisitions' 11th annual M&A Mid-Market Award winners: Campbell Soup, Huron Capital, Idera CEO Randy Jacops, LLR Partners, McGuireWoods, Stryker, Twin Brook and William Blair.