M&A wrap: CorePower Yoga, TSG, L Catterton, TPG Growth, Aurora Cannabis
TSG Consumer Partners has acquired CorePower Yoga from PE firm L Catterton. The deal marks the first investment from TSG's eighth fund, which the San Francisco firm closed at $4 billion in February. CorePower operates about 200 yoga studios in 23 states. “CPY is a powerhouse within the fitness segment, and yoga is particularly attractive given its high level of consumer penetration, broad accessibility and appeal relative to other areas of boutique fitness," says TSG managing director Michael Layman. According to the National Institutes of Health, the number of U.S. adults surveyed that participate in yoga has increased from 9.5 percent to 14.3 percent between 2012 and 2017, while the use of meditation has increased from 4.1 percent to 14.2 percent during the same time period. Founded in 1987, TSG focuses on the food, beverage, restaurant, beauty, personal care, household, apparel and accessories, and e-commerce sectors. L Catterton was formed in 2016 when French luxury goods maker LVMH Moët Hennessy Louis Vuitton combined its PE arm L Capital with consumer-focused investment firm Catterton. Advisors to TSG include: Piper Jaffray (NYSE: PJC), Jefferies and Ropes & Gray. Advisors to CorePower include: Bank of America Merrill Lynch and Kirkland & Ellis.
Alternative asset firm TPG, a backer of Airbnb Inc. and Uber Technologies Inc., has placed William E. (“Bill”) McGlashan, Jr. on leave, after he was among the dozens of individuals charged on March 12 by federal officials in what the U.S. Justice Department says was a multimillion-dollar nation-wide scheme to cheat the college admissions process. McGlashan is the founder and managing partner of TPG Growth, the firm’s middle market investment group, and the co-founder and CEO of The Rise Fund, a social impact investment firm backed by U2's Bono, LinkedIn founder Reid Hoffman and others. “As a result of the charges of personal misconduct against Bill McGlashan, we have placed Mr. McGlashan on indefinite administrative leave effective immediately,” said a TPG spokesperson in a statement shared with Mergers & Acquisitions. “Jim Coulter, co-CEO of TPG, will be interim managing partner of TPG Growth and The Rise Fund. Mr. Coulter will, in partnership with the organization’s executive team, lead all investment work for both going forward.”
PE firms LightBay Capital and Freeman Spogli & Co. are buying Fastsigns International Inc. The target operates 700 locations that sell signs and other visual graphics. Advisors to Fastsigns include: Harris Williams, North Point Advisors, Kirkland & Ellis and Greenberg Traurig. The buyers are being represented by Proskauer LLP. Financing is being provided by Ares Capital Corp.
SNH Capital Partners has acquired background screening company Universal Background Screening and merged it with portfolio company PeopleFacts. Gibson, Dunn & Crutcher LLP represented SNH and WhiteHorse Capital provided financing.
Medical technology company Hill-Rom Holdings Inc. (NYSE: HRC) is buying mobile healthcare communications provider Voalte for up to $195 million. Willkie Farr & Gallagher LLP is representing Voalte.
Rotunda Capital-backed heating, ventilation and air conditioning distributor Munch's Supply has acquired Comfort Air Distributing to expand in Colorado. CapitalValue Advisors advised the target.
02 Investment Partners-backed water treatment technology company Vessco has invested in Dorner Products, a supplier of flow control equipment.
Nelson Peltz is joining Aurora Cannabis Inc. (NYSE: ACB) as a strategic advisor and is receiving stock options that could make him the company's second-largest shareholder. “Nelson is a globally recognized business visionary with a strong track record of constructive engagement to generate accelerated, profitable growth and shareholder value across many verticals of great interest to us,” Aurora CEO Terry BoothClick said in a statement. “I believe Aurora has a solid execution track record, is strongly differentiated from its peers, has achieved integration throughout the value chain and is poised to go to the next level,” Peltz said. Read the full story from Bloomberg News: Nelson Peltz joins Aurora Cannabis as strategic advisor.
Stephen d’Incelli was promoted from principal to managing director at private investment firm SK Capital Partners, and Lee Karras has joined the same firm as a director. Karras was most recently the CEO of SK Capital-backed Halo Pharmaceuticals.
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.
Cannacord Genuity's purchase of Petsky Prunier, Cisco's acquisition of Luxtera, and Platinum Equity's backing of sprinkler maker Pro-Mark were among the mid-market deals that closed in February.
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 in M&A. The list is based on volume of completed 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.
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.”
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.
Mergers & Acquisitions has closed the nomination process for the 2018 M&A Mid-Market Awards. We look forward to announcing the winners later in March. The Awards are one of three special reports we produce each year to celebrate deals, dealmakers and dealmaking firms. The other two are The Rising Stars of Private Equity and The Most Influential Women in Mid-Market M&A.
The Women's Private Equity Summit is being held at the Monarch Beach Resort in Dana Point, California, March 13-15. The Summit will bring together more than 550 female professionals in private equity and venture capital.
The ACG Chicago Women’s Network is hosting a lunchtime conversation with Dorri McWhorter, the CEO of YWCA Metropolitan Chicago, on March 19 at the University Club in Chicago.
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.