M&A wrap: CPPIB, Oak Hill, Kraft Heinz, Primal Kitchen
Canada Pension Plan Investment Board is investing $500 million in packaging company Berlin Packaging. Oak Hill Capital Partners and the target's CEO, Andrew Berlin, are investing alongside CPPIB. Berlin Packaging offers companies a "one-stop shop" for glass, plastic, metal containers and closures. The target has $1.4 billion in annual sales. "This transaction allows us to take our business to an even higher level as we pursue multiple strategic initiatives, including acquisitions in North America and Europe, additions to our sales and service teams, and more investment in our e-commerce capabilities,” says Andrew Berlin. CPPIB has been increasingly active in the middle market. In perhaps its most notable deal, CPPIB bought mid-market lending powerhouse Antares Capital from GE Capital in 2015. Oak Hill began investing in 1986 as the family office for Robert Bass, one of four brothers who founded Bass Brothers Enterprise. The firm invests in companies in the consumer, industrial, media and retail sectors.
Kraft Heinz Co. (Nasdaq; KHC) is buying Primal Nutrition LLC, a better-for-you brand that makes mayonnaise, salad dressing and avocado oil under the Primal Kitchen brand, for $200 million. “My mission has always been to change the way the world eats," says Primal Kitchen co-founder Mark Sisson. "Our partnership with an industry leader like Kraft Heinz now offers an unrivaled opportunity to reach millions more of the consumers who have been seeking products like ours for years." Paul, Weiss, Rifkind, Wharton & Garrison LLP is advising Kraft. Food conglomerates are diversifying their product lines to appeal to consumers who are opting for healthier snacks. For example, in 2018, Hershey Co. (NYSE: HSY) paid $420 million for Pirate Brands.
Accounting firm Keiter has combined Keiter Stephen Advisors with Keiter Transaction Advisors to form Keiter Advisors. The combined company will focus on lower middle-market M&A with businesses that have up to $200 million in revenue. In addition, M&A veteran and Keiter founding partner Carroll Hurst will serve as a director of both Keiter and Keiter Advisors starting Jan. 1.
H.I.G. Capital-backed Vantage Specialty Chemicals Holdings is buying Leuna-Tenside GmBH. The target produces chemicals that are used personal care and industrial cleaning products. C.I.M is advising Vantage.
Swander Pace has acquired Nutrional Medicinals LLC, a maker of organic and shelf-stable feeding tube formulas.
Neustar is buying TrustID, a provider of caller authentication and fraud prevention systems for contact centers.
Cannabis-focused investment firm Rose Capital has raised its debut fund at $55 million. For more on M&A trends in the cannabis sector, read the full story: How to seize M&A opportunities in marijuana’s gray market.
In time for the holidays, private equity firms are giving back - organizing groceries at food pantries, mentoring students in schools, running races for cancer cures and pitching in at animal shelters. In the spirit of holiday giving, Mergers & Acquisitions highlights the philanthropic and volunteering initiatives of 5 PE firms: the Carlyle Group LP (Nasdaq: CG), Frontier Capital, Huron Capital, the Riverside Co. and Star Mountain Capital. At Carlyle, charity starts at the top, with CEO David Rubenstein's signing of The Giving Pledge, a commitment by the world’s wealthiest individuals and families to dedicate the majority of their wealth to philanthropy. Community involvement is more important than ever to today’s work force. Millennials, defined as people born between 1981 and 1996 by the Pew Research Center, are “for sustainability, diversity, inclusion and giving back to the community,” says Carlyle managing director Christopher Ullman. “We are finding this more and more. Yes, we are here to make money, secure retirement for pensioners, but the firm wants to support people’s efforts to make the world a better place.” Frontier Capital supports several causes, including The Miracle League, a baseball organization for people who are mentally and physically challenged. “There’s more to life than work and material things, and our people understand that,” says Frontier managing partner Andrew Lindner. At Detroit-based Huron Capital, the firm’s philanthropic efforts are focused on local groups. “We want to leave our footprint in this community where we live and work while being as helpful as possible,” says partner Gretchen Perkins. “The charitable activities we do as a group, the ability for each employee to influence where Huron’s donations go, and the ability to perform community service during work hours, or receive matching funds for an employee’s personal non-profit passion, all contribute to a portion of an employee’s sense of purpose and contributing to the greater good.” Read the full story, The Big Give.
Cyber Week and holiday shopping shine a spotlight on the retail industry, and the pressure on purveyors is more intense than ever, with Sears’ recent bankruptcy filing serving as a cautionary tale. It's been a year since Amazon bought Whole Foods, a game-changing deal for the sector. Technology is driving many of the transactions. Best Buy Co. (NYSE: BBY) recently agreed to spend $800 million to buy GreatCall, a provider of emergency response services for seniors, from Chicago private equity firm GTCR. Meanwhile, GreatCall announced a partnership with on-demand transportation provider Lyft to make it easier for seniors to get car service. “Many of the challenges that retailers are currently facing are due more to a lack of innovation and investment in technology, and that they are not able to compete with Amazon,” said Alex Monahan, a consumer products senior analyst at tax and consulting firm RSM US LLP. “Investors want to see that retailers are adjusting to consumer’s changing preferences and striving to provide seamless multi-channel experiences, while also investing in technology to address the tight labor markets.” Amazon, Walmart, Ikea, Bed, Bath & Beyond and Farm Boy are among the retailers turning to M&A. For more, see 5 trends driving retail M&A.
We asked dealmakers at ACG Philadelphia's M&A East to share their thoughts on Giving Back. Check out our video interviews with Baker Tilly Capital's Judit Nagy-Eichelber: Volunteer work brings teams together and Reed Smith's Jonathan Moyer: For millennial dealmakers, giving back is part of who they are.
The New Orleans Saints take on the Dallas Cowboys Thursday night to kick off NFL Week 13. Off the field, many football players invest in companies. New England Patriots quarterback Tom Brady recently teamed with former Giants defensive end Michael Strahan, who is the co-host of ABC’s Good Morning America, to launch a sports media startup called Religion of Sports Media, which has raised $3 million in venture capital funding from CourtsideVC and Advancit Capital. Muhsin Muhammad, who played wide receiver for the Carolina Panthers and the Chicago Bears, is a managing director of private equity firm Axum Capital Partners. Steve Young, former San Francisco 49ers quarterback, is a co-founder of private equity firm HGGC. View our slideshow, NFL stars Tom Brady, Michael Strahan, Steve Young go PE.
In New York, it's Middle Market Week. Hosted by ACG New York Nov. 26-30, events throughout the city bring together leading global middle-market dealmaking professionals.
ACG New York Women of Leadership Summit brings together women in the middle-market dealmaking community for a day focused on networking and knowledge sharing on Jan. 17 at the Intercontinental Barclay Hotel. Alexa Von Tobel, chief innovation officer of Northwestern Mutual, keynotes.
Exponent Women kicks off the new year with an evening of networking on Jan. 24 at The Campbell, at New York's Grand Central Terminal. Jazz Age financier John W. Campbell converted the space to his private office and reception hall in 1923, and it has recently been restored by design firm Ingrao Inc.