M&A daily wrap: Del Frisco's, Barteca, Starbucks, Nestlé, Gulf Capital, Saudi Geidea, Carlyle, Advent
Del Frisco’s Restaurant Group, Inc. (NASDAQ :DFRG) has agreed to acquire Barteca Restaurant Group from Rosser Capital Partners and General Atlantic for $325 million in cash. Barteca operates two chains: Barcelona, the largest Spanish restaurant concept in the U.S., with 15 restaurants and three under development; and Bartaco, with 16 locations and four under development. “We believe Barteca’s innovative and ‘best in class’ concepts are highly complementary and will provide Del Frisco’s portfolio with significant growth and development opportunities," said Del Frisco's CEO Norman Abdallah. "They will provide opportunities to enable us to capture market share in the experiential dining segments, while mitigating the risk of seasonality and economic downturns to our current restaurant portfolio. Similar to Del Frisco’s own vision and mission, Barteca’s founders Andrew Pforzheimer and Sasa Mahr-Batuz created Barcelona and Bartaco to celebrate life in restaurants through great food, wine and hospitality. As a result, their award-winning concepts have become leading ‘experienced-based’ lifestyle brands that provide them competitive advantages in the marketplace. These include connectivity beyond the four-walls of the restaurants, culture and brand transcending food, and powerful ‘halos’ that drive appeal and loyalty." Piper Jaffray is acting as financial advisor to Del Frisco’s, and Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal advisor. Kirkland & Ellis LLP is acting as legal advisor to Barteca. JPMorgan Chase and Citizens Financial Group are providing committed financing for the transaction.
Starbucks Corp. (NASDAQ: SBUX) is forming a global coffee alliance with Nestlé S.A. to accelerate and grow the global reach of Starbucks brands in the consumer packaged goods and foodservice sectors. "With a shared commitment to ethical and sustainable sourcing of coffee, this alliance will transform, expand and elevate both the at-home and away-from-home coffee and related categories around the world," says Starbucks.
As part of the alliance, Nestlé is paying $7.15 billion for the rights to market, sell, and distribute Starbucks and Teavana brands. “This global coffee alliance will bring the Starbucks experience to the homes of millions more around the world through the reach and reputation of Nestlé,” said Starbucks CEO Kevin Johnson. “This historic deal is part of our ongoing efforts to focus and evolve our business to meet changing consumer needs, and we are proud to work alongside a company that is committed to our shared values.” Nestlé CEO Mark Schneider said: “This transaction is a significant step for our coffee business, Nestlé’s largest high-growth category. With Starbucks, Nescafé and Nespresso we bring together three iconic brands in the world of coffee. We are delighted to have Starbucks as our partner. Both companies have true passion for outstanding coffee and are proud to be recognized as global leaders for their responsible and sustainable coffee sourcing. This is a great day for coffee lovers around the world.”
Gulf Capital, a private equity based in Abu Dhabi, has acquired a strategic stake in Saudi Geidea, the leading provider of electronic payment products in Saudi Arabia, for $267 million. "In a relatively short period of time, Geidea has emerged as the market leader in the financial technology sector in Saudi Arabia, paving the way for more financial institutions and businesses in the Kingdom to adopt Saudi Arabia’s Vision 2030 of achieving far-reaching economic prosperity and moving towards a cashless society," said Gulf Captial CEO Karim El Solh in a statement. This deal is the fifth investment for Gulf Capital in the technology sector and is part of its efforts to develop the payment and digital financial transaction sector in the area. The transaction comes just days after the launch of an initiative by the Saudi ِArabian Monetary Authority designed to promote financial technology in the Gulf region. Abu Dhabi, Dubai and Bahrain are also seeking to position themselves as centers of fintech.
The Carlyle Group (NASDAQ: CG), has announced the appointment of Hongjiang Zhang as a senior advisor to the firm's Asian private equity platform. Zhang's previous positions include: CEO of Kingsoft, the Chinese software and Internet services company; chief technology officer of Microsoft Corp.'s Asia-Pacific research and development group; and research manager at Hewlett-Packard Labs. Carlyle plans to "expand our already significant investment activities in the technology, media and telecom (TMT) sector in China and across Asia," says X.D. Yang, managing director and chairman of Carlyle Asia.
Wearable biometrics for diabetes patients and other breakthroughs herald a wave of custom treatments, says Aspire Ventures CEO Essam Abadir. The firm recently teamed with the Penn Medicine Lancaster General Health network of hospitals to launch a $300 million fund to invest in personalized medical devices and practices. Read our Q&A with Abadir: How precision medicine, AI and the Internet of Things are transforming healthcare M&A.
Advent International has agreed to sell Morsco, a U.S. distributor of plumbing products, waterworks materials, and heating and cooling (HVAC) equipment, to Reece Limited (ASX: REH). Reece, the leading distributor of plumbing, waterworks and HVAC products in Australia, is acquiring Morsco for $1.44 billion in cash. Reece intends to operate Morsco separately from its businesses in Australia and New Zealand, with the existing management team remaining in place under the leadership of CEO Chip Hornsby.
Comvest Partners is investing in RugsUSA, an e-commerce retailer and supplier of area rugs and other home décor products. Koorosh Yaraghi, founder of RugsUSA, will continue in his role as CEO and as an owner of the company. Digital Fuel Capital, a private equity firm focused on e-commerce and led by Carson Biederman and Bruce Crain, will work with Comvest as operating partners and investors in RugsUSA.
Pryor Cashman has brought aboard Michael Weinsier as co-head of the law firm's private equity practice. He joins as a partner in the New York office, having previously been with Troutman Sanders. With more than 30 years of experience, Weinsier specializes in complex corporate transactions, including leveraged buyouts, domestic and cross-border mergers and acquisitions, divestitures, auction bids and sales, joint ventures and co-investments.
Watch our video interview with LLR Partners managing director Michael Sala, in which he outlines what the Philadelphia firm looks for in portfolio companies and how LLR helps them grow. LLR won Mergers & Acquisitions’ M&A Mid-Market Award for 2017 Private Equity Firm of the Year.
Huron Capital, Michigan's most active private equity firm and winner of Mergers & Acquisitions’ M&A Mid-Market Award for 2017 Seller of the Year, recently raised the $141 million Huron Flex Equity Fund for making non-control investments. We asked Huron managing partner Brian Demkowicz about the new fund and the thinking behind it. Read our Q&A here.
Read our Q&A with GTCR managing director Aaron Cohen about The Leaders Strategy and the Chicago firm's sale of Callcredit, a U.K. provider of real-time credit reports, to TransUnion (NYSE:TRU) for about $1.4 billion.
Check out our Q&A with ParkerGale partnerDevin Mathews about the firm's recent investment in CultureIQ/Corporate Executive Board, overall market trends and the firm’s podcast. Read the full Q&A here.
KKR, LLR Partners, the Riverside Co., Shore Capital Partners, TA Associates and other private equity firms and strategic buyers, including Cognizant (Nasdaq: CTSH), are investing in eye doctors, dentists and veterinarians, plus revenue cycle management providers and other areas of healthcare that are ripe for consolidation, as Mergers & Acquisitions explores in our in-depth feature,Why private equity firms like veterinarians, opthamologists and dentists,and slideshow, 6 healthcare specialties driving M&A deals.
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.