M&A wrap: Liberty Tax, Vitamin Shoppe, Salesforce, Roper, Permira

vitaminshoppe

Liberty Tax Inc. is buying nutritional products retailer Vitamin Shoppe Inc. (NYSE: VSI) for $208 million. The deal is part of Liberty Tax's strategy to diversify its business lines by acquiring companies that have the potential to be franchised. The company, which owns Liberty Tax Services, recently completed a deal for Buddy's Home Furnishings, which sells and leases consumer electronics, appliances and furniture. As a result of its new focus, Liberty Tax is changing its name to Franchise Group Inc. Liberty Tax has received an equity commitment from Vintage Capital Management. Vitamin Shoppe operates around 750 stores under the Vitamin Shoppe and Super Supplements brands. "Following a careful and disciplined assessment, the board of directors has concluded that the acquisition proposal from Liberty Tax maximizes value for our shareholders," says Vitamin Shoppe CEO Sharon Leite. "We are committed to transforming into an agile, customer-first organization that differentiates our brand through best-in-class quality, innovation and expertise across our products and services.” Advisors to Vitamin Shoppe include: Bank of America Merrill Lynch and Kirkland & Ellis. The advisor to Liberty Tax is Troutman Sanders. Willkie Farr & Gallagher LLP is representing Vintage Capital Management.

DEAL NEWS
Salesforce.com Inc. (NYSE: CRM) is acquiring ClickSoftware Technologies Ltd. from Francisco Partners for about $1.35 billion. Salesforce co-CEOS Marc Benioff and Keith Block are seeking new markets, including business intelligence and blockchain, to reach an annual revenue goal of $26 billion to $28 billion by fiscal year 2023. Read the full story by Bloomberg News: Salesforce acquires ClickSoftware.

Permira Funds is buying Cambrex Corp. (NYSE: CBM), a contract drug developer, for about $2.4 billion. Advisors to Cambrex include: Morgan Stanley and Kirkland & Ellis. The legal advisor to Permira is: Skadden, Arps, Slate, Meagher & Flom LLP. Financing is being provided by RBC Capital Markets.

Roper Technologies Inc. (NYSE: ROP) is buying iPipeline, a provider of cloud-based software for the life insurance and financial services sectors, from Thoma Bravo for $1.6 billion. "Insurance products provide people protection when they need it most, and we are committed to providing leading digital technologies to expand the market," says iPipeline CEO Larry Berran. Advisors to the sellers include: Credit Suisse, Kirkland & Ellis and Lauletta Birnbaum LLP.

Bayer AG is buying the majority stake it does not already own in BlueRock Therapeutics for up to $600 million. BlueRock develops cell therapies in neurology, cardiology and immunology. Orrick is advising Bayer.

Experian is acquiring MyHealthDirect, a digital care coordination platform that optimizes scheduling for providers, payers, and consumers.

DEAL TRENDS
WeWork Cos. took the real estate world by storm on its way to an initial public offering that’s set to be among the year’s biggest. It’s not the only co-working firm that’s primed for new heights. More and more companies are vying to meet global demand for hip, furnished offices without the commitment of a long-term lease. Some, such as IWG Plc’s Regus, preceded WeWork. Read the full story by Bloomberg News: WeWork's looming IPO also will prove decisive for slew of rivals.

PEOPLE MOVES
Bryan Gadol was hired by law firm Orrick as a partner. Gadol was most recently with Morgan Lewis, and focuses on M&A and private equity across the technology, medical devices, beauty, healthcare and manufacturing sectors.

Hunter Madeley was hired by JMI Equity-backed Vena Solutions as CEO. Madeley was most recently with HubSpot.

Scott Shebelsky has been promoted to CFO at private equity firm Lovell Minnick Partners. Shebelsky joined the firm in 2015 as vice president of finance and chief compliance officer.

RISING STARS
Looking for a glimpse of what’s to come in the private equity industry? Meet the 10 dealmakers named by Mergers & Acquisitions as the 2019 Rising Stars of Private Equity:

Austin Collier, Branford Castle Partners
Kevin Cunningham, LNC Partners
Shawn Domanic, Sterling Partners
Stephen Jeschke, GTCR
Danielle Lalli, Huron Capital
Jason Mironov, TA Associates
James Oh, Transom Capital Group
Sophia Popova, Summit Partners
Pavan Tripathi, Bregal Sagemount
Christine Wang, Francisco Partners

The Rising Stars share a common set of core values. They are passionate about building companies. They are naturally curious and interested in changing things for the better. They enjoy working with portfolio company managers, investment bankers and other deal team members. They appreciate the responsibility and autonomy their firms have given them. They are grateful for the leaders who have helped shape their careers, and they are generous with their own time when it comes to nurturing the next generation. As the PE industry goes through a generational shift and many firm founders retire, it's well worth getting to know these emerging leaders. They represent the future of private equity. 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.

MORE FEATURED CONTENT
Dealmaking in August began with a bang, as the London Stock Exchange Group Plc agreed to snap up Refinitiv in a $27 billion blockbuster deal. And M&A was hopping in July, with observers predicting the third quarter will be an active one. Meanwhile, here is a table of middle-market deals that closed in the first half of the year, including 3M Co.'s (NYSE: MMM) purchase of MModal's technology business; Apollo Global Management LLC's (NYSE: APO) acquisition of Smart & Final Stores; and KPS Capital Partners' purchase of Brunswick Corp.'s (NYSE: BC) fitness business. For more see, 3M's purchase of MModal's tech business a highlight of H1 dealmaking.

Alex Rodriguez is best known as the New York Yankees star who hit 696 home runs over the course of his 22-year baseball career, but today he’s making a name for himself as an investor as the founder and CEO of A-Rod Corp. One recent example: While serving as a guest judge on CNBC’s Shark Tank, Rodriguez backed Ice Shaker, an insulated bottle maker founded by former National Football League fullback Chris Gronkowski. Rodriguez talked about his life off the field as a savvy investor since his 20’s as the keynote speaker at EisnerAmper’s 4th annual Alternative Investment Summit at the The Museum of Modern Art on June 19. Among the topics discussed in a conversation led by Charles Weinstein, CEO of EisnerAmper: Rodriguez’ childhood as the son of a single mom; his investment thesis, which shares much with other middle-market investors; how he’s helping singer/dancer/actress Jennifer Lopez (to whom he became engaged in March) transition her business initiatives from licensing her brands to owning them; and how one day he just might buy a baseball team. Read the full story: A-Rod talks Ice Shaker, NRG eSports, J. Lo & maybe buying a baseball team.

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.

Organizations in industries, ranging from manufacturing to healthcare, are using M&A to add automated technology in their processing systems. Advances in robotic technology are making it possible to complete more complex tasks at higher speeds and with improved control and outcomes. Read the full story: Accelerating automation through M&A.

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.

EVENTS
The Association of Asian American Investment Managers (AAAIM) is holding its annual conference from Sept. 4-5 at Convene at 730 Third Avenue in New York.

The Great Lakes ACG Capital Connection is being held at the Westin Book Cadillac Detroit Hotel in Detroit from Sept. 4-6.

ACG Boston and ACG Connecticut are hosting the 5th Annual ACG New England Fall Conference at Gurney's Newport Resort & Marina in Newport, Rhode Island from Sept. 17-18.

M&A East is taking place at the Pennsylvania Convention Center in Philadelphia from Oct. 22-23.

Third Annual Women in Alternative Investments Career Forum is taking place at the New York Hilton on Nov. 8.

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