M&A wrap: Liberty Hall, Sekisui, Aim Aerospace, Pfizer, Sotheby's, Clearlake

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Sekisui Chemical Group is buying Aim Aerospace, a designer and producer of aerosapce parts, from Liberty Hall Capital Partners for $510 million. Sekisui is a Japense plastics parts maker that serves the environmental, infrastructure and medical sectors. The acquisition will expand Sekisui's presence in the U.S. aerospace sector. The company says there is a lot of growth potential in the sector with several orders for new airplanes pending. Founded in 1988 as part of U.K.-based Aim Group plc, Aim has more than 1,000 employees operating at factories and R&D center. Some of its customers include: Boeing Co. (NYSE: BA), Kawasaki Heavy Industries and Spirit AeroSystems. In 2017, Liberty Hall acquired Quatro Composites, a supplier of parts and assemblies for the aerospace industry, and integrated the company into Aim. “With the support of Liberty Hall, Aim Aerospace has grown stronger in the past three years by extending its leadership position in manufacturing of complex thermoplastic aerospace components, growing its customer base, and entering the engine composites segment of the market,” says Liberty Hall partner Taylor Catarozoli. Advisors to Liberty Hall include: Lincoln International and Gibson Dunn & Crutcher.

Activity and urgency characterize the current dealmaking environment, say investment bankers and other M&A advisors interviewed by Mergers & Acquisitions. After a record-breaking 2018, forecasts for 2019 remain bullish. Advisors point to a lot of cash that must be deployed by strategic buyers and private equity firms alike; a healthy U.S. economy; and low interest rates. Competition for high-quality targets has never been more intense, especially for technology providers, they report, which means sellers are commanding high prices. It all adds up to a seller’s market. A mood of urgency prevails, as dealmakers seek to close deals quickly, while conditions remain favorable. The advisors interviewed for this story say they don’t see signs of a recession this year; however they are closely monitoring bellwethers, including corporate earnings, wage pressure, global supply chains and slowdowns abroad. They are recommending that clients be prepared for an economic slowdown in the next two years. Specialization is the name of the game, and investment bankers advise clients to seek targets with business-model stability, limited cyclical exposure and a recurring revenue business model. Technology, business services, healthcare, consumer and manufacturing are among the most promising sectors. Read the story: 8 M&A advisors urge closing deals now, while economy stays strong.

DEAL NEWS
Pfizer Inc. (NYSE: PFE) is buying Array BioPharma Inc. (Nasdaq: ARRY) for $10.6 billion to expand in cancer treatment, which has become one of the hottest areas for deal activity between drug and biotechnology companies. The Array deal is Pfizer’s biggest since its 2016 acquisition of Medivation for $14 billion. Read the full story by Bloomberg News: Pfizer expands in cancer treatment with Array deal.

BidFair USA, an entity owned by Altice founder and art collector Patrick Drahi, is buying art auction house Sotheby's (NYSE: BID) for $3.7 billion. Sotheby's said the acquisition will allow the company to grow "in a more flexible private environment." Advisors to Sotheby's include: LionTree Advisors and Sullivan & Cromwell. Advisors to BidFair include: BNP Paribas, Morgan Stanley, Hughes Hubbard & Reed LLP and Ropes & Gray. Financing is being provided by BNP Paribas.

Clearlake-backed Unifrax materials provider has acquired Stellar Materials, a manufacturer of chemicals and materials that are made under the Thermbond brand. The target was advised by BMO Capital Markets. Financing was provided by Morgan Stanley and Stifel.

High Road Capital Partners-backed Banner Solutions has bought Berg Wholesale. The target is a wholesale distributor of door hardware, bath hardware, and security products for the residential and multi-family housing sectors. Jones Day advised High Road. Financing was provided by Monroe Capital.

The Middleby Corp. (Nasdaq: MIDD) has acquired Ss Brewtech, a provider of craft brewing and beverage equipment.

Wealth Partners Capital Group-backed MAI Capital Management has purchased independent registered investment adviser MTX Wealth Management.

Software company ASG has acquired photography software provider PhotoLynx.

For more fundraising news, see PE fundraising scorecard: Clarion, Monomoy, Rockwood, Rotunda.

PEOPLE MOVES
Steve Chang has joined private investment firm Access Holdings as a partner. He was most recently with LLR Partners.

Jeff Jacobson was hired by private equity firm Siris as executive partner. Jacobson was most recently the CEO of Xerox (NYSE: XRX).

David Perotti has joined private equity firm Align Capital Partners as an operating partner, where he is helping the firm accelerate its focus on investments in tech-enabled services. Perotti was most recently the CEO of Software-as-a-service company eRecruit.

Albert Stemp was hired by law firm Kirkland & Ellis as a partner, where he is focusing on real estate M&A. Stemp was previously with Proskauer Rose.

David Tuit has joined Huron Capital-backed property and casualty insurance company High Street Insurance Partners as CFO and senior partner. Tuit was most recently with insurance brokerage firm Acrisure.

FEATURED CONTENT
Healthcare companies are spending more on information technology than ever before. Private equity firms including: Bain Capital, GTCR, Great Hill Partners, The Riverside Co. and New Heritage Capital, are investing in the innovations most in demand, including big data, SaaS and artificial intelligence, as we explore in depth in Mergers & Acquisitions' feature, Healthcare's must-have technologies. “Healthcare IT is the largest cottage industry in the world,” says Sam Hendler, who leads healthcare IT deals at Harris Williams.“Healthcare IT is a highly fragmented, multi-billion-dollar market with thousands of companies focused on different $250 million to $500 million sub-markets. Savvy investors see there is an opportunity to aggregate assets and build platforms of scale. It’s an incredibly exciting time in healthcare IT.” For recent transactions that showcase the trends, see 5 private equity-backed healthcare IT deals.

Tech dominates dealmaking. The technology, media and telecom, or TMT, sector accounted for about 40 percent of total private equity deal volume and one-third of total capital invested by PE firms over the last five years, according to EY Private Equity. Looking forward, the next five years of M&A activity will be fueled by a whole new set of developments. As one wave of technological innovation crests, another is forming. “With themes such as cloud computing and mobility now mainstream, PE firms are focusing on the next wave of disruption — technologies such as artificial intelligence and machine learning, robotic process automation (RPA), Internet of Things (IoT), robotics, drones, blockchain, augmented reality and virtual reality,” finds the April edition of EY’s quarterly PE Pulse report. Read our full coverage: Smart cities, IoT, AI, robots, edge computing will fuel next wave of tech M&A.

Today's active M&A market demands a robust set of tools and services. Enter service providers. From online marketplaces, such as Axial, led by CEO Peter Lehrman (pictured), to offerings that help private equity firms administer funds, such as Frazier & Deeter's FD Fund Administration, the service providers featured in Mergers & Acquisitions' updated annual dealmaker's guide help get transactions done. For the full guide, read: Dealmaker's guide to service providers: Accordion, Axial, BluWave, Frazier & Deeter.

Big data, Artificial Intelligence (AI), the Internet of Things (IoT) and 5G are transforming the business world. By embracing these technologies, organizations across the globe are realizing untapped potential in efficiency, customer experience, talent and profitability, and have been able to make better, more streamlined mergers and acquisitions, writes Bank of America Merrill Lynch's Robert Arth in a guest article. Read the full story: Why the middle market needs big data.

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 Nike, award winners include: Fortive, TA Associates, the Riverside Co., Harris Williams, Monroe Capital, Goodwin and Luminate Capital Partners' Hollie Haynes. Read our full coverage: Meet the winners of the M&A Mid-Market Awards: Nike, Fortive, TA, Harris Williams.

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 Tennessee hosts the Mid-South ACG Capital Connection at the Omni Louisville Hotel in Louisville, Kentucky from June 20-21.

Exponent Women hosts the Annual Exchange, which brings a trusted network of women dealmakers together for a focused day of robust content and networking, at Second in New York, on July 11. The Exchange provides attendees with opportunities to establish new connections, reinforce existing ones and absorb timely and relevant knowledge from industry leaders.

ACG Seattle hosts the Northwest Middle Market Growth Conference at the Fairmont Olympic Hotel in Seattle on July 25.

M&A East is taking place at the Pennsylvania Convention Center in Philadelphia from Oct. 21-23.

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