M&A wrap: CD&R, PowerTeam, Hubbell, Ingersoll Rand, AEI, Genstar
Clayton, Dubilier & Rice is acquiring PowerTeam Services LLC, a provider of maintenance and construction services to the U.S. utility industries from Kelso & Co. for undisclosed terms, as M&A in the energy industry proliferates. PowerTeam provides services to maintain, repair, upgrade, and install natural gas and electric distribution and transmission systems. These services are critical to maintaining the safety, reliability and integrity of aging gas and electric infrastructure, says the private equity firm, which has offices in New York and London. PowerTeam’s customer base includes leading regulated utilities in the southeastern and midwestern U.S., which it serves through a network of 42 locations in 21 states with approximately 4,200 employees. Approximately two-thirds of PowerTeam's revenue is related to natural gas systems, and more than 70 percent of revenue is derived from distribution infrastructure. "The company has a very promising future," said John Krenicki, CD&R operating partner, former vice chairman of General Electric Co. (NYSE: GE) and CEO of GE Energy. "PowerTeam's management has built a strong market position, and we share their vision for the future, which we believe will create rewarding career opportunities for the company's more than 4,000 talented employees." Krenicki will serve as the chairman of PowerTeam post-closing. Lewis Hay, operating advisor to CD&R funds and former chairman, president, and CEO of NextEra Energy, will serve on PowerTeam’s board of directors. Kirkland & Ellis LLP served as CD&R's legal advisor. Harris Williams acted as financial advisor, and Debevoise & Plimpton acted as legal advisor to PowerTeam.
The energy industry is teeming with M&A activity, as companies seek to improve operations. Hubbell and Ingersoll Rand are among the strategic buyers. Private equity firms acquiring include AE Industrial Partners, Clayton, Dubilier & Rice and Genstar Capital. Companies in the energy industry are focused on improving operational efficiencies and analytical capabilities. The issues are urgent for oil and gas companies, because depressed prices mean profits are hard to come by, says Caroline Blitzer Phillips, who advises clients on energy deals as a partner at law firm Vinson & Elkins. They are also essential for renewable energy, which “has been quite expensive in some cases, because the infrastructure is not in place.” From providers of “smart grids” to developers of energy management software, Mergers & Acquisitions looks at recently acquired targets. Read the full story: 14 smart energy deals.
Volkswagen AG mapped out details of its transformation from a mass manufacturer of cars to a provider of transportation services by unveiling a car-sharing service and promising digital acquisitions as part of a 3.5 billion-euro ($4 billion) push into next-generation automobiles. The plan will kick off in Berlin, where the manufacturer will put 2,000 all-electric vehicles on the road by the second quarter of 2019 under the We Share label, competing with the DriveNow and Car2Go offerings of Daimler AG and BMW AG. Volkswagen plans to start technology partnerships this year, with purchases likely “clearly before Christmas,” Juergen Stackmann, head of sales at the VW namesake brand, said in a Bloomberg Television interview in the German capital. Read the full story: VW gets really serious about tech acquisitions.
Celerity Partners, Gemini Investors and NewSpring Mezzanine have made an investment in specialty pharmacy Total Care RX. Total Care focuses on delivering medications to organ transplant patients and residents in long-term healthcare facilities.
ClearPoint Investment Partners has invested in Accommodations Plus International. The target provides critical crew logistics and distressed passenger services to airline and cruise companies.
Cannabis company Golden Leaf Holdings Ltd. has agreed to acquire cannabis growers Tahoe Hydroponics Company and 11T Corp. For more on deal treands in the marijuana sector read: How to seize M&A opportunities in marijuana’s gray market. Canaccord Genuity Corp. is advising Golden Leaf.
Goldman Sachs Group Inc.'s (NYSE: GS) merchant banking division is buying Restaurant Technologies, a provider of automated cooking oil products to restaurants, from Aurora Capital. Harris Williams is advising Restaurant Technologies.
Insight Venture Partners has made a growth equity investment in EveryAction, a fundraising software provider to non-profits and campaigns.
TA Associates has formed a partnership with Athena Alliance, a non-profit dedicated to helping more women attain board seats. As part of the partnership, TA portfolio companies will have the opportunity to offer their senior women leaders access to personal development coaching from Athena Alliance to prepare them for a board director role.
TPG Capital-backed Mediware Information Systems Inc. has acquired Rock-Pond Solutions, an analytics provider to medical services and specialty pharmacy companies.
As Indra Nooyi ends her 12-year run in the top job at PepsiCo Inc. (NASDAQ: PEP), the number of women CEOs in the S&P 500 drops to 24. But in the middle market, a growing movement is nurturing women-led companies. For example, Lorine Pendleton, a member of Pipeline Angels, focuses on inclusion investing, backing companies led by diverse entrepreneurs. Read the full story: Inclusion investing nurtures companies led by women and minorities.
Exponent, a new group of women dealmakers, brought together 200 women from private equity funds, investment banks, startups and M&A advisory firms for the Exponent Exchange, featuring Sallie Krawcheck as the keynote speaker. Previously the CEO of Wall Street banks, including Merrill Lynch Wealth Management and Citi Private Bank, Krawcheck serves as the CEO of Ellevest, an online investing platform for women. Mergers & Acquisitions participated as an in-kind sponsor, and editor-in-chief Mary Kathleen Flynn moderated a panel. Check out our slideshow, Exponent drew 200 women dealmakers to event featuring Sallie Krawcheck.
Mergers & Acquisitions has announced 11 Rising Stars of Private Equity, including John Kos, GTCR; Ethan Liebermann, TA Associates; Jennifer Roach, Yellow Wood Partners; and Afaf Ibraheem Warren, Siris Capital . The up-and-coming investors are expected to play significant leadership roles in the future. See: Meet Mergers & Acquisitions' 11 Rising Stars of Private Equity.
While some of the firms that were instrumental in launching the middle market back in the 1980s and 1990s have long since been shuttered, their legacy lives on. They proved to be excellent training grounds for many successful dealmakers. Heller Financial certainly belongs in this category, and Mergers & Acquisitions featured its alumni a few years ago. Another firm with a far reach is Holleb & Coff, a Chicago law firm that closed in 2000, after a nearly 50-year run. Founded by Marshall Holleb and Morris Coff in 1951, the firm advised prestigious clients, such as American National Bank, Hollinger International Inc.and LaSalle Bank. Revenue topped $40 million in 1997. In its heyday, Holleb & Coff employed 130-plus attorneys; it was the law firm to work for in the Midwest. Drawn to the supportive culture, new associates and seasoned partners alike enjoyed working at the venerated firm. Many of the lawyers who worked at Holleb & Coff back in the day are making a significant impact on M&A today, including: John Corvino, general counsel to the Chicago White Sox; · Brian Kerwin, chair of Duane Morris’ global corporate practice; Theodore (Ted) Koenig, the founder and CEO of Monroe Capital; Kenneth Serota, president of Hu-Friedy Manufacturing Co., and Michelle Warner, general counsel, USG Corp. (NYSE: US). Read the full story: Holleb & Coff alumni: Where are they now?
See Mergers & Acquisitions' look at 10 PE firms that have succeeded in raising new funds recently despite an overall slowdown in PE fundraising, including the Carlyle Group (Nasdaq: CG), PPC Partners, Soundcore Capital Partners and Sycamore Partners. For the latest on PE fundraising, see PE fundraising scorecard: Ridgemont Equity and Yellow Wood.
Procter & Gamble Co. (NYSE: PG) is focusing on growing its top 25 brands, including Bounty paper towels, Charmin toilet paper, Crest toothpaste,Pampers diapers,Nyquil cough and cold medicine, and Tide laundry detergent, while seeking acquisitions. In April, P&G announced plans to buy Merck KGaA’sconsumer-health business for $4.2 billion. The deal includes the Femibionand Neurobion over-the-counter healthcare brands. P&G is also purchasing skincare brand First Aid Beauty. “What you have to have is the brand consumers prefer, because then retailers want to carry it, because it builds the basket,” P&G CEO David Taylorexplains. Read the full story: Why P&G is changing its M&A strategy.
Summer reading list: 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’ list entertain, instruct and inspire. Check out our listicle: Dealmaker’s guide to summer reading: 15 new books.