M&A wrap: Estée Lauder, Have & Be, Dr. Jart, Kylie Jenner, Coty Walmart, McDonald's, HP, Xerox

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The Estée Lauder Cos. (NYSE: EL) is buying the majority stake it does not already own in skincare company Have & Be Co. to expand its consumer reach in Asia. Have & Be, based in Seoul, South Korea, expects to generate $500 million in 2019 and has an enterprise value of $1.7 billion. Estée Lauder acquired a minority stake in the target in 2015. Have & Be owns the Dr. Jart+ skincare along with the Do The Right Thing men's grooming brands. “As consumers increasingly focus on skincare and the category continues its rapid global growth, the influence of cutting-edge, scientifically-driven brands like Dr. Jart+ is undeniable," says Estée Lauder executive chairman William Lauder. Dr. Jart+ sells moisturizers, masks, cleansers under the Cicapair and Ceramidin names. The deal, which is Estée Lauder's first of an Asian-based beauty brand, will expand the company's presence in travel retail. “Since the beginning of our partnership four years ago, the company has shared our mission to provide the very best skin care and beauty products to consumers around the world," adds Have & Be CEO ChinWook Lee. Perella Weinberg Partners, Lowenstein Sandler LLP and Kim & Chang are advising Estée Lauder. Michel Dyens & Co., Skadden, Arps, Slate, Meagher & Flom LLP and Bae, Kim & Lee LLC are advising Have & Be.

Coty Inc. (NYSE: COTY) is paying $600 million for a majority stake in Kylie Jenner’s cosmetics line. The makeup and fragrance giant will have overall responsibility for the portfolio, while Jenner, part of the Kardashian clan, will lead creative efforts and communications. The deal values Kylie Cosmetics, which Jenner, 22, started in 2015 as a line of lip kits when she was still a teenager, at about $1.2 billion. Read the full story by Bloomberg News: Coty buys stake in Kylie Jenner's beauty company.

Retailers are increasingly using artificial intelligence to manage their stores and monitor shopping behavior and offer better experiences, as we discover in the second installment of Mergers & Acquistions’ 7-part series, Retail Tech M&A. Walmart Inc. (NYSE: WMT) and McDonald's Corp. (NYSE: MCD) use AI to lure customers, while Amperity aims to provide a 360-degree view of what a customer is buying.

DEAL NEWS
HP Inc.’s (NYSE: HPQ) board unanimously rejected Xerox Holdings Corp.’s (NYSE: XRX) unsolicited takeover proposal, saying the $22-a-share offer is too low and citing concerns about the smaller rival’s prospects in the printing industry. HP is “open to exploring” a merger but there are “fundamental questions that need to be addressed,” CEO Enrique Lores and chairman Chip Bergh wrote in a letter to Xerox CEO John Visentin. Read the full story by Bloomberg News: HP rejects Xerox's offer as too low.

HKW has acquired John M. Floyd & Associates. The target offers software and consulting services to credit unions and community banks to help with their overdraft programs. Taft Stettinius & Hollister LLP advised HKW. Foley & Lardner LLP and GulfStar Group advised the target.

Vestar Capital-backed Woodstream Corp. has acquired Dynamic Solutions Worldwide, the maker of DynaTrap insect traps. Woodstream is a manufacturer of branded pest and animal control products.

Vista Equity Partners has bought Accelya, a software provider to arilines, shippers and travel agents, from Warburg Pincus.

Biofourmis has purchased Biovotion AG, a maker of biosensor wearable products.

Genstar-backed Mercer Global Advisors bought wealth management firm AL Hewitt.

Huron Capital-backed Pueblo Mechanical & Controls has acquired plumbing company Niemeyer Brothers Plumbing.

For more deal news, see Weekly wrap: Anheuser-Busch, Allegro, OpenText.

To see which other firms are fundraising, check out PE fundraising scorecard: Atalaya, Investcorp, Kohlberg, Sage Equity

PEOPLE MOVES
Benjamin Mondics has joined Littlejohn-backed Kaman Distribution Group as CEO. He most recently served as president and CEO of Eriks North America.

Edward Nelson was hired by Latham & Watkins as a partner. Previously with Gibson Dunn, Nelson concentrates on the organization and operation of private investment funds.

Debbie Yee has joined law firm Kirkland & Ellis as a partner. She was previously with Latham & Watkins, and focuses on M&A in the energy sector.

FEATURED CONTENT
Internet of Things is transforming retail and how the trend is playing out in dealmaking. Nike (NYSE: NKE) is making acquisitions to enhance its customer experiences. Nike bought Zodiac and Invertex Ltd., a pair of innovative digital startups helping the athletic apparel maker get closer to customers. McDonald’s Corp. (NYSE: MCD), the world’s largest restaurant chain, is gobbling up digital startups to improve customer experiences by capitalizing on IoT innovations- a strategy new CEO Chris Kempczinski supports. The company is buying personalization company Dynamic Yield for a reported $300 million in its largest deal in more than 20 years, and will use the software to customize drive-thru menus. Check back every Friday throughout the holiday shopping season for a new installment.

Esteemed M&A attorney Martin (“Marty”) Lipton was honored at a black-tie event hosted by the Institute of International Education at The Pierre in New York on Oct. 30. Called the “the king of M&A,” the co-founder of New York law firm Wachtell, Lipton, Rosen & Katz, is well known to dealmakers as the architect of the anti-takeover defense strategy known as the “poison pill.” Lipton was awarded the IIE Stephen P. Duggan Award for Mutual Understanding “in recognition of his lifetime of extraordinary achievement and his lasting contribution to international higher education. Read the full story: Martin Lipton, inventor of the “poison pill” anti-takeover defense honored by IIE.

It’s a milestone year for the Blackstone Group Inc. (NYSE: BX), which transitioned from a publicly traded partnership to a corporation on July 1. The New York firm announced the final close of its latest global real estate fund recently. With $20.5 billion of total capital commitments, Blackstone Real Estate Partners IX is the largest real estate fund ever raised. Mergers & Acquisitions spoke with Stephen A. Schwarzman, the firm’s co-founder, chairman and CEO. Read the full story: "Complete control" is the beauty of private equity, says Blackstone's Stephen A. Schwarzman.

The private equity model has held up very well over the decades, continuing to outperform the public markets, even as economic cycles come and go. But the rate of growth has slowed, leading PE firms to seek adjacent areas of business to expand. As PE firms face increased pressure to produce higher returns on their investments, many of them are turning to a familiar area of business: lending. Adams Street Partners, Balance Point Capital, Carlyle and VSS are all actively engaged in lending. Read the full story: Private equity firms are becoming lenders. Here’s why.

Prokanga is a unique recruiting firm that offers full-time and flexible recruiting services. Prokanga is managed by co-founders Jamie Cheney and Lesley Finer (pictured). Mergers & Acquisitions spoke with Finer, who has more than 10 years of recruiting for the finance industry and leads the finance practice at Prokanga. For more, see Why financial services pros need flexibility.

Looking for a glimpse of what’s to come in the private equity industry? Meet Mergers & Acquisitions' 2019 Rising Stars of Private Equity. As the PE industry undergoes a generational shift, and many firm founders retire, it’s well worth getting to know these emerging leaders, including Branford's Austin Collier, Sterling Partners' Shawn Domanic and Summit Partners' Sophia Popova. For profiles and video interviews, see Meet Mergers & Acquisitions' 2019 Rising Stars of Private Equity. For Q&As, see 10 Rising Stars of Private Equity tell their tales.

Online retailers, including Amazon.com Inc. (Nasdaq: AMZN), are adding more fulfillment centers to meet consumer demands for faster shipping times. The owners of these properties along with the contractors that build them are becoming prime M&A targets. More local fulfillment centers means faster delivery times and lower last-mile costs to both retailers and customers. Read the full story: Amazon and Walmart open more logistics centers, driving warehouse M&A.

To celebrate deals, dealmakers and dealmaking firms, Mergers & Acquisitions produces three special reports every year: the M&A Mid-Market Awards; the Rising Stars of Private Equity; and the Most Influential Women in Mid-Market M&A. For more on the timeline and nomination process for each, see Special reports overview: M&A Mid-Market Awards, Rising Stars, Most Influential Women.

EVENTS
Exponent Women is hosting a Family Office Event with Owens Group at LX Gallery in New York on Nov. 21. Mergers & Acquisitions editor-in-chief Mary Kathleen Flynn is moderating a panel.

The Annual Winter Conference AM&AA is taking place in Scottsdale, Arizon fron Jan. 8-10.

Deal Wave is being hosted by ACG Orange Country at the Ritz-Carlton-Laguna Niguel in Dana Point, California on Jan. 9.

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