M&A wrap: FP, HGGC, LLR, Silver Lake, TA, Vista, Clearlake

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Technology permeates many of today’s private equity deals, and PE 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. “Technology, in and of itself, is invading every end market, and it is driving companies to be more competitive than their peers,” points out Richard Lawson, CEO of tech-focused PE firm HGGC. As PE firms consider the tech landscape, they are watching Amazon.com Inc. (Nasdaq: AMZN) closely. “We are always thinking about how we can help companies that are going to get dislocated and disintermediated by Amazon,” says Lawson. “End markets everywhere are being changed by Amazon. As Amazon scales, it will challenge all kinds of industries and it will have a cascading effect across all sectors. You are already seeing more companies trying to connect their brands with consumers in new ways.” 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.

Mergers & Acquisitions seeks nominations for the 12th Annual M&A Mid-Market Awards, which will honor leading dealmakers and deals that set the standard for transactions in the middle market in 2018. The deadline for nominations is end of day Friday, February 8, 2019. Click here to submit nominations. To determine the winners, Mergers & Acquisitions considers a variety of factors. We look for companies and individuals who overcame the challenges the year brought, embodied the trends of the period and took their businesses to the next level. Market leadership and performance are important, but league tables aren’t everything. Growth counts for a lot, especially when the rate of growth outpaces peers and the overall industry. Innovation also counts. We value companies that businesses. Thought leadership in the industry is also relevant. Looking at past winners provides a good guide to what we’re seeking. Last year’s winners included Campbell Soup, Huron Capital, Idera, LLR Partners, McGuireWoods, Stryker, Twin Brook and William Blair. For more information, read the full story: Call for Nominations: 12th Annual M&A Mid-market Awards.

Deal news
Clearlake Capital-backed Perforce Software is acquiring Rogue Wave Software. The target offers a suite of tech services that is designed to improve developer productivity. "Software development is growing increasingly complex, driving the need for platforms and solutions that can help enterprises simplify their applications and shorten cycle times," says Rogue Wave CEO Brian Pierce. William Blair and Shea & Co. advised Rogue Wave. Antares Capital, Ares Capital Management, AB Private Credit Investors, Barings Finance, PennantPark Investment Advisers and Varagon Capital Partners provided financing.

Advent International is buying a 51 percent stake in payments company Prisma Medios de Pago. The deal values Prisma at around $1.4 billion. The target is one of Latin America's largest payments services companies.

Gryphon Investors has bought RoC Skincare, anti-aging skincare brand, from Johnson & Johnson Consumer Inc. Sawaya Partners LLC and Covington & Burling advised Johnson & Johnson. LSH Partners and Kirkland & Ellis advised Gryphon.

San Francisco Equity Partners has acquired a majority stake in makeup and skincare brand Jane Iredale. The Sage Group advised the target. Morrison & Foerster is advising SFEP.

Highlander Partners-backed Biamp Systems has bought Cambridge Sound Management, a provider of sound masking technology, from Gladstone Investment Corp. and Boston Harbor Capital. Capstone Headwaters advised the sellers.

Knox Capital-backed HaystackID has acquired eTERA Consulting, an eDiscovery managed services company. ORIX Mezzanine & Private Equity, Maranon Capital and Baird Principal Group also invested in the deal.

AnaCap Financial Partners-backed Heidelpay Group has bought payment services company Universum.

Transaction Network Services has purchased R2G Services, a market data distributor for the financial services sector.

For more deal announcements, see The Weekly wrap: Fiserv, Gannett, Wex.

For more PE fundraising news, see PE fundraising scorecard: Atlantic Street, CVC, Peak Rock.

People moves
Anurag Sharma has been named head of European investment banking at William Blair. Sharma was most recently the head of West coast investment banking for the firm.

Matthew Gemello was hired by Orrick, where is he focusing on M&A in the technology sector. Gemello was most recently with Baker & McKenzie.

Oliver s’Jacob has joined Morrison & Foerster as a partner. He was most recently with Reed Smith, and concentrates on private equity investments in real estate.

Paul Klick was hired by investment bank The McLean Group as a senior managing director. He focuses on M&A in the technology, media and telecom sectors, and was previously with Evergreen Advisors Capital and Outcome Capital.

Carolyn Vardi has joined Ropes & Gray as a partner. She was previously with White & Case, and focuses on private equity and M&A.

Featured content
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. "Actively lobby and ask from day one to work on deals, so you can gain dealmaking experience early in your career," advises Bradley. "Too often, women are steered into functions like marketing, business development, and investor relations – the 'softer side' where it is easier to place a female. The excuse often used is that the females don’t have the deal experience of their male counterparts. That is why you must be an advocate for yourself and work on deals from the very beginning."

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

Mergers & Acquisitions asked leading dealmakers about their outlook for the middle market in 2019. Watch the video conversations, shot at ACG Philadelphia's M&A East: It is a seller's market, and deal activity is expected to remain steady, says Ramsey Goodrich of Carter Morse & Goodrich: Outlook 2019: Great time to sell. Private equity firms and strategic buyers will use their excess cash and capital to look for deals, says Bharat Ramprasad of Stifel Nicolaus: Outlook 2019: Excess capital to fuel M&A. Rising interest rates and regulatory changes may increase volatility, cautions Mark Emrich of Murray Devine: Outlook 2019: Keep an eye on rising interest rates.

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. 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. Read the full story, The Big Give.

GTCR managing director Phil Canfield learned the fundamentals of private equity investing at the Business Honors Program at The University of Texas at Austin. Now he and his wife Mary Beth are giving back to UT’s McCombs School of Business. In recognition of the $20 million gift, the program has been renamed the Canfield Business Honors Program. "Private equity investors are wired to look for opportunities to get the very best returns for their investment," Canfield tells Mergers & Acquisitions in a Q&A. Read the full story: GTCR's Phil Canfield donates $20M to UT's McCombs School of Business.

Dealmakers share their thoughts on Giving Back in video interviews conducted by Mergers & Acquisitions at ACG Philadelphia's M&A East. Check out our video with Reed Smith's Jonathan Moyer: For millennial dealmakers, giving back is part of who they are. And watch our conversation with Baker Tilly Capital's Judit Nagy-Eichelber: Volunteer work brings teams together.

The construction data industry is fragmented, and there is a growing demand for technology that will help contractors, drawing deal activity particularly from strategic buyers. Autodesk Inc. (Nasdaq: ADSK) and Trimble (Nasdaq: TRMB) are among the buyers in the sector. “There is a huge opportunity to streamline all aspects of construction through digitization and automation,” says Autodesk CEO Andrew Anagnost. Read the full story: Strategic buyers look to capitalize on construction data demand.

The New England Patriots and the Los Angeles Rams will face off in the Super Bowl. Off the field, 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. 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. Check out: NFL stars Tom Brady, Michael Strahan, Steve Young go PE.

Events
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.

ACG Boston, ACG Connecticut, ACG New Jersey, ACG New York & ACG Philadelphia host ACG Northeast Dealmaking at the Mountain at Stowe Mountain Resort in Stowe, Vermont Jan. 27-29. The event provides a chance for middle-market M&A professionals from across the northeast to come together for two days of close knit networking, shared conversations and valuable time spent to deepen your relationships within the deal community.

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