M&A daily wrap: Stephen Feinberg, Cerberus, Trump's Intelligence Advisory Board, Tyson Foods
Stephen Feinberg, the founder and co-CEO of private investment firm Cerberus Capital Management LP, has been named chair of President Donald Trump's Intelligence Advisory Board, which provides advice on the quality of intelligence collection and analysis. Feinberg, who had reportedly been considered for the post for a year, "brings over 30 years of experience conducting organizational assessments, operational improvements, and complex reforms across foreign and domestic stakeholders to his position," the White House said in a statement. In 2017, Feinberg joined President Trump and U.S. Secretary of Defense James Mattis on a trip to see the aircraft carrier Gerald R. Ford in Newport News, Virginia, after it was reported that Feinberg had held discussions with the administration about a review of U.S. intelligence agencies. Founded in 1992, Cerberus focuses on four primary strategies: control and non-control private equity; distressed securities and assets; commercial mid-market lending and real estate-related investments. The New York firm and its affiliates manage more than $30 billion for investors, including government and private sector pension and retirement funds, charitable foundations and university endowments, insurance companies, family offices, sovereign wealth funds and high net worth individuals. Among the firm's investments is military contractor DynCorp International. Perhaps in anticipation of Feinberg's new role in government, Cerberus announced in April that Matt Zames was joining the firm as president. Zames served as chief operating officer of JPMorgan Chase & Co. (NYSE: JPM) from 2012 to 2017. At that time, Cerberus also promoted Frank Bruno from president to co-CEO, alongside Feinberg. A 20-year veteran of Cerberus, Bruno works closely with Feinberg to oversee and manage the firm's global investment activities across asset classes, sectors, and geographies. To name one recent deal, in April, Cerberus bought Electrical Components International Inc. from KPS Capital Partners.
Tyson Foods Inc. (NYSE: TSN) is acting on its plan to be more environmentally responsible by agreeing to buy the poultry rendering and blending assets of American Proteins Inc. and Ampro Products Inc. $850 million. The deal will allow Tyson to recycle more animal products for feed, pet food and aquaculture, and expand its presence in the growing animal feed ingredient business. “Rendering plays a key role in growing our business and helping us deliver on our sustainability goals,” says Tyson CEO Tom Hayes. “Through this important business, no part of the animal goes to waste, and we can recycle valuable ingredients into feed for pets and aquaculture.” The acquisition includes four rendering plants located in Georgia and Alabama and 13 blending facilities located throughout Southeastern and Midwestern states. The facilities are expected to provide additional capacity to Tyson’s current animal byproducts business. Rendering is an environmentally friendlier way to keep animal products out of landfills and potentially reduce greenhouse gas emissions. Tyson aims to reduce greenhouse gas emissions by 30 percent by 2030, including a commitment to support improved environmental practices on 2 million acres of corn by the end of 2020.
Ardian has raised more than $800 million for its first infrastructure fund. Completed in less than six months, the fund expands Ardian's investment opportunities in the U.S. Ardian has already made two investments out of the fund. It partnered with Transatlantic Power Holdings to create a renewable energy platform called Skyline Renewables, and the firm previously acquired LBC Tank Terminals. "We see an opportunity in the US infrastructure middle market, which remains insufficiently served and offers a higher risk return proposition. We will also be leveraging proprietary deal flow, stemming from our global industrial partners doing business in the Americas," says Mathias Burghardt, head of Ardian Infrastructure. Ardian recently hired Mark Voccola as co-head of the firm’s U.S. infrastructure group.
Colliers International Group Inc. (Nasdaq: CIGI) has agreed to buy a 75 percent stake in real estate investment firm Harrison Street Real Estate Capital LLC for up to $550 million. The buyer will pay $450 million upfront and another $100 million in 2022, based on Harrison's achieving performance targets. "The transaction establishes us as one of the major players in global real estate investment management, providing an important new growth platform that also facilitates the integration of our existing operations in Europe," says Colliers CEO Jay Hennick. Berkshire Capital and DLA Piper are advising Harrison Street. Three Ocean Partners and Winston & Strawn are advising the target's shareholders. Sidley Austin is representing Colliers.
Steel Dynamics Inc. (Nasdaq: STLD) has agreed to purchase steel products producer Companhia Siderurgica Nacional LLC from CSN Steel for $400 million. Steel Dynamics CEO Mark Millett says the acquisition "represents a step in the continuation of our growth strategy. It levers our core strengths, and at the same time fulfills our initiatives to further increase value-added product and market diversification."
Lower middle-market private equity firm River Associates has bought GAHH, a maker of convertible car tops, seat covers and other interior materials. Prestwick Advisors and Katten Muchin Rosenman advised GAHH. Bass Berry & Sims represented River Associates, which received financing Abacus Finance and Eagle Private Capital. For more on auto-related deals, see our slideshow, Car parts makers fuel M&A, as industry readies for self-driving vehicles.
Manna Development has bought 38 Panera Bread stores In Colorado. CapitalSpring structured and led the deal's financing and recapitalization. Manna now owns more than 130 Panera Breads across seven states. Trinity Capital and Snell & Wilmer advised Manna. Chapman & Cutler represented CapitalSpring.
The Halifax Group has invested in ChanceLight Behavioral Health, Therapy & Education. The Nashville-based target serves children and young adults that have autism spectrum and other behavioral disorders. Financial terms were not disclosed.
Private equity firms, including KKR, LLR Partners, the Riverside Co., Shore Capital Partners, TA Associates, 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.
Trivest Partners-backed BJ Beltram Inc. has acquired Tampa, Florida-based foodservice equipment provider Louis Wohl and Sons Inc. The deal represents Beltram's first under Trivest's ownership and the company will look for more add-on acquisitions. Financial terms were not disclosed.
Mindspace Ltd., a coworking space operator, has acquired Klein Kantoor, a coworking operator with seven properties in Amsterdam. Financial terms were not disclosed.
Covenant-lite loans are making a comeback, as competition in middle-market lending increases, says Ken Ken, CEO of Churchill Asset Management. Following on the heels of a record year of capital raising, debt financing provider Churchill recently closed a $300 million collateralized loan obligation fund, Churchill Middle Market CLO IV. Churchill is part of Nuveen, the asset management division of TIAA. Overall, Churchill manages more than $4.4 billion in committed capital. Read our Q&A: CLOs are huge draw for income-hungry investors, says Churchill CEO Ken Kencel.
For more on the lender front, Twin Brook Capital Partners grew significantly in 2017, including doubling deal value from the previous year, raising a second fund of $2.3 billion, and building the three-year-old firm into a major source of loans in the lower middle market, earning the firm Mergers & Acquisitions' M&A Mid-Market Award for 2017 Lender of the Year. The Chicago firm is the middle-market direct lending subsidiary of Angelo, Gordon & Co., a $28 billion alternative investment firm focused on credit and real estate investing. Twin Brook was founded in 2014 by seasoned middle-market lenders Trevor Clark and Christopher Williams, who had previously co-founded Madison Capital Funding. Twin Brook announced recently that Williams has stepped 8back from his role to attend to a health issue with an immediate family member. Read our Q&A: Lenders must be active partners, says Twin Brook's Trevor Clark.
Artificial intelligence, the Internet of Things, wearable biometrics and precision medicine are transforming dealmaking in the healthcare sector, says Essam Abadir, the CEO of Aspire Ventures, which 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.
Read our Q&A with GTCR managing director Aaron Cohen about The Leaders Strategy and the Chicago private equity firm's sale of Callcredit, a U.K. provider of real-time credit reports, toTransUnion (NYSE:TRU) for about $1.4 billion.
Check out our Q&A with ParkerGale partner Devin Mathews about the tech-focused private equity firm's recent investment in CultureIQ/Corporate Executive Board, M&A investing trends and how the Chicago firm uses its weekly podcast.
Alvarez & Marsal hired four managing directors in Paris as part of the firm's efforts to meet demands in France and expand its cross-border M&A services. Jonathan Gibbons, Guillaume Martinez, Frederic Steiner and Donatien Chenu have all joined the firm.
David Graff has joined Oaklins DeSilva + Phillips as a senior advisor. He focuses on brand extensions, licensing and retail programs for media and branding companies. Graff founded SunGate Partners in 2000.
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.