M&A wrap: Fortive, Gordian, Disney, 21st Century Fox, Turkey Hill, Peak Rock

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Fortive Corp. (NYSE: FTV) has won Mergers & Acquisitions' M&A Mid-Market Award for the 2018 Deal of the Year for the $775 million acquisition of Gordian, a developer of software for the construction industry, from Warburg Pincus LLC. The deal marks a transformative transaction for Fortive and for the construction industry as a whole. “Gordian’s over 70 years of proprietary construction cost data and domain expertise and a seasoned management team created the industry standard in construction task data, workflow software and service,” Fortive CEO James Lico said when the deal was announced in July. With a total addressable market of $20 billion and massive scale globally, the construction software sector is extremely attractive but plagued by antiquated, paper- and spreadsheet-based systems, according to investment bank William Blair, which advised Gordian on the sale to Fortive. The construction industry is ripe for the productivity gains that software and data can deliver, and the adoption of software platforms is reaching an inflection point. “In addition to the generational shift that is occurring as more millennials and other digital natives ascend the ranks at contractors and project owners, several construction technology platforms have now reached a scale at which the data they collect provides immensely valuable information to constituents across the construction ecosystem,” said Peter Dalrymple, managing director, William Blair. “The growth and maturation of software and analytics platforms, such as Gordian’s, are bringing much-needed efficiency to the construction ecosystem.”

Excelled. Innovated. Inspired. That’s what the eight winners of Mergers & Acquisitions’ 12th Annual M&A Mid-Market Awards did in 2018. Our awards honor the leading dealmakers and deals that set the standard for transactions in the middle market. In addition to Fortive, award winners include: Nike, TA Associates, the Riverside Co., Harris Williams, Luminate Capital's Hollie Haynes and more. Read our full coverage: Meet the winners of the M&A Mid-Market Awards: Nike, Fortive, TA, Harris Williams.

Related: Read more about Mergers & Acquisitions' three annual special reports, including the M&A Mid-Market Awards, the Rising Stars of Private Equity, and the Most Influential Women in Mid-Market M&A.

Deal news
Walt Disney Co. (NYSE: DIS) has completed its $71 billion acquisition of 21st Century Fox Inc.’s entertainments assets. With the deal, Disney takes over a portfolio that includes the 104-year-old 20th Century Fox studio, the FX and National Geographic cable networks, and an additional 30 percent of Hulu, the online video service. The deal is one of the most dramatic in the current wave of entertainment-industry mergers, shrinking the number of major Hollywood studios to five from six and putting the irreverent Homer Simpson and Family Guy cast in the same stable of classic cartoon characters as Mickey Mouse and Donald Duck. Read the full story by Bloomberg News: Disney closes Fox deal.

Peak Rock Capital is buying Turkey Hill ice cream maker from Kroger Co. (NYSE: KR). "We believe that Turkey Hill represents an excellent platform for growth through near-term organic initiatives and strategic acquisitions," says Peak Rock CEO Anthony DiSimone. "We will be aggressively pursuing complimentary acquisitions to extend the product and brand portfolio." The acquisition of Turkey Hill represents Peak Rock's eighth current investment in the food and beverage industry. Some of the PE firm's other investments in the sector include: Berner Food & Beverage; Diamond Crystal Brands; Gold Coast Bakeries; Louisiana Fish Fry; Pretzels Inc.; Sweet Harvest Foods; and TNT Crust. Kroger announced plans in 2018 to explore a sale for Turkey Hill. "We believe this is the right step to ensure the Turkey Hill business can meet its full potential and continue to grow its successful ice cream and beverage brands," says Erin Sharp, group vice president for Kroger Manufacturing. Goldman Sachs (NYSE: GS) is advising Kroger.

Food company Cooks Venture, founded by Blue Apron (NYSE: APRN) co-founder Matthew Wadiak, has acquired Crystal Lake Farms. The deal includes two hatcheries and 57 poultry houses. In addition, Cooks Venture also acquired two processing plants in Oklahoma.

GTCR has partnered Gregory Lucier to form healthcare company Corza Health, which will focus on acquiring businesses in the life sciences and medical technology sectors. Lucier will serve as Corza's CEO and will make an investment alongside GTCR. Lucier most recently served as CEO of medical device company NuVasive. The partnership is part of the Chicago private equity firm's The Leaders Strategy, which involves "finding and partnering with management leaders in core domains to identify, acquire and build market-leading companies through transformational acquisitions and organic growth."

Ardian has raised its fifth infrastructure fund at $6.9 billion. The firm's infratsructure team now manages about $15 billion in assets across Europe and North America. Digitalization is transforming the role played by physical assets, Ardian has identified five critical attributes, which form the foundation of a new approach to value creation called Augmented Infrastructure. For more, read: How digital disruption is transforming private equity investments in infrastructure.

Genstar Capital-backed Drillinginfo has bought Midland Map Co., a map provider in the Permian basin. Earlier in 2019, Drillinginfo acquired Cortex, a software provider for the energy sector. Drillininfo is a data analytics company for the energy sector.

Berkshire Partners-backed records and information services provider Access has acquired document management company Docu-Depot.

Novume Solutions has acquired vehicle technology company OpenALPR. The target's software allows automatic license plate and vehicle recognition real time vehicle license plate data, color, make, model and body type through cameras.

People moves
Christoper Finn has been promoted to chief operating officer at the Carlyle Group (Nasdaq: CG). Finn joined Carlyle in 1986, and served as global head of operations since January 2018.

Nader Pasdar has been named head of markets North America at agriculture and food and beverage-focused financial services firm Rabobank, and Chris Hartofillis has been promoted to head of capital markets.

Carolyn Wintner was hired by PE firm Charlesbank Capital Partners as head of capital markets. She was most recently with Bain Capital Credit.

Featured content
The Duke University Blue Devils, along with the University of North Carolina Tar Heels, the University of Virginia Cavaliers and the Gonzaga University Bulldogs, rank as the top four seeds in the 2019 NCAA Tournament, which begins on March 21 and culminates in the national championship on April 8. This year, March Madness offers fans unprecedented access to online betting, thanks to a May 2018 U.S. Supreme Court ruling. More Americans are expected to place bets on the NCAA tournament than the Super Bowl, with the American Gaming Association's predicting that about $8.5 billion in wagers will be placed on the tournament. Online betting and data companies, including sportsbooks from DraftKings, FanDuel and Caesars, are drawing basketball fans and interest from investors.

Related: March Madness: DraftKings, FanDuel, Action Network draw fans, dealmakers.

Technology M&A is thriving, and private equity firms are hot on the trail of innovations that will drive sustainable value to customers and make companies more efficient, more effective and less expensive to run. Among the developments appealing to PE investors are: artificial intelligence, data management, data virtualization, digital marketing, healthcare IT, industrial automation, the Internet of Things, machine-to-machine learning, payment processing and Software-as-a-Service. To gain more insights into what kinds of tech deals will dominate the field in 2019, Mergers & Acquisitions reached out to 10 private equity firms that are active investors in technology: Francisco Partners, Genstar, Great Hill, HGGC, Insight, LLR, Riverside, Silver Lake, TA and Vista.

Related: 10 private equity firms share strategies for tech M&A.

In Mergers & Acquisitions' annual look at strategic buyers, we see significant deals aimed at enhancing the customer relationship, including Amazon.com Inc.'s (AMZN) purchase of PillPack, Nike Inc.'s (NYSE: NKE) acquisitions of Invertex Ltd. and Zodiac Inc. and Target Corp.s' (NYSE: TGT) acquisition of Shipt. Technology plays a key role in many transactions. But while technology is enabling developments, it’s not an end unto itself for many corporations. Instead, strategic buyers are using innovations as a means to achieve goals. Based on analyzing hundreds of recent deals, Mergers & Acquisitions has identified seven goals corporate dealmakers hope to accomplish through M&A transactions today: Integrate data with software; improve the customer experience and relationship; expand and improve distribution; process payments more efficiently; leverage tech trends, like autonomous vehicles; make manufacturing processes more efficient; and achieve better outcomes and efficiencies in healthcare. “Strategics have been really active,” says John Neuner, managing director, Harris Williams. “They are aggressive in pursuing the assets they want, as long as it fits within their strategy. Scale is critical to them, and they have to meet consumer demands by adding new capabilities.”

Related: 7 reasons why smart companies Amazon, Nike, Target are doing M&A.

Mergers & Acquisitions profiles the top 28 investment banks of 2018, with KPMG, Houlihan Lokey, Goldman Sachs (NYSE: GS), William Blair and Lincoln International ranking as the five most active investment banks in private equity-backed deals. The list is based on volume of completed PE-backed deals, with PitchBook as the data provider. It was a good year for dealmaking, with activity in the U.S. middle market exceeding $400 billion, the first year to achieve the milestone.

Related: Top investment banks in PE-backed deals: KPMG, Houlihan, GS, William Blair
Related: M&A soared in 2018; companies confident about dealmaking in 2019.

Mergers & Acquisitions has named 36 leaders the 2019 Most Influential Women in Mid-Market M&A, including Kainos Capital's Sarah Bradley, Kayne Anderson Capital Advisors' Nishita Cummings and Pelham S2K Managers' Venita Fields. All 36 are outstanding dealmakers both inside and outside of their firms. This year, we asked the featured dealmakers to tell their own stories through Q&As, including their advice for women.

Related: Meet the 2019 Most Influential Women in Mid-Market M&A.

Events
ACG New York's Women of Leadership is hosting a golf event and reception on March 21 at Konnect Golf in Manhattan. The event brings together female dealmakers from private equity firms, investment banks and lenders.

Exponent Women LLC is hosting an evening of networking and conversation with leading economists at the New York office of Alliance Bernstein on April 4. Speakers include Lindsey Piegza, chief economist, Stifel Fixed Income, and Kathleen Fisher, head of wealth and investment strategies, Alliance Bernstein.

Innovation Works is holding its second annual AI/Robotics Venture Fair in Pittsburgh from on May 15 and 16.

ACG New York, ACG Boston and ACG Philadlephia are holding the Industrial Conference with Value Creation at the Infor in New York on June 6. The event is part of the Northeast Industry Tour.

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