M&A wrap: ResMed, MatrixCare, Lime Rock, Credit Karma, Noddle, Silver Lake, TransUnion
ResMed (NYSE: RMD) has agreed to pay $750 million to acquire privately held MatrixCare, a provider of U.S. long-term post-acute care software, serving more than 15,000 providers across skilled nursing, life plan communities, senior living and private duty. The care settings are complementary to ResMed’s current Software-as-a-Service (SaaS) offerings in home medical equipment, home health and hospice, delivered through Brightree and Healthcarefirst, according to ResMed. “By establishing a technology footprint across these major care settings, ResMed will drive an integrated ecosystem of solutions, such as maintaining single-patient records across multiple care settings, generating analytics and insights that can be applied to individuals and whole populations, and streamlining processes for healthcare providers across the care continuum,” said ResMed SaaS president Raj Sodhi in a statement. ResMed is funding the deal primarily with its credit facility. In calendar year 2018, MatrixCare proforma net revenue is estimated to be approximately $122 million, with a proforma Ebitda of approximately $30 million. MatrixCare CEO John Damgaard is expected to continue in his current role, reporting to Sodhi. ResMed is an active acquirer. The company agreed in May to buy Healthcarefirst, a provider of software and services for home health and hospice agencies. ResMed won Mergers & Acquisitions' 2016 M&A Mid-Market Award for Deal of the Year for purchasing Brightree, a developer of cloud-based software to improve clinical and business performance for post-acute-care (PAC) providers, for $800 million. The MatrixCare deal comes on the heels of ResMed’s recent first-quarter earnings announcement on Oct. 25, when the company reported revenue of $588.3 million and GAAP diluted earnings per share of $0.73, surpassing expectations.
Lime Rock, a Houston-based private equity firm that invests in energy exploration and production (E&P) and oilfield service companies, has announced the final closing of Lime Rock Partners VIII LP, and an affiliated co-investment vehicle with $688 million in aggregate capital commitments. In June, the firm announced the closing of Lime Rock Partners IV AF LP at $1.9 billion, with $741 million of new capital commitments. In total, Lime Rock has closed $1.4 billion in new capital commitments in 2018. The Lime Rock Partners team seeks to deploy the capital in Fund VIII through investments in high-growth, differentiated oil and gas businesses in the E&P and oilfield services sectors with a particular focus on U.S. shale-related opportunities. Morgan, Lewis & Bockius LLP acted as legal counsel to Fund VIII. Eaton Partners, a division of Stifel Financial Corp. (NYSE: SF), served as the placement agent.
Credit Karma, a personal finance technology company that helps members monitor and improve credit health, has agreed to buy Noddle, a service that provides free, unlimited access to credit scores and reports to people in the U.K., from TransUnion. In March, technology investor Silver Lake acquired a significant minority stake in the company worth approximately $500 million from existing equity holders through an organized secondary process. Credit Karma founder and CEO Kenneth Lin remains the largest shareholder. Silver Lake managing partner Mike Bingle joined the company’s goard of directors.
Pamplona Capital Management LLP has expanded its leadership team with the appointment of Martin Schwab and William Pruellage as co-managing partners, jointly responsible for day-to-day operations. Alex Knaster and John Halsted will continue to lead the firm, with Knaster remaining as chairman and CEO, and Halsted becoming president of private equity and continuing as chair of the investment committee. The firm has also promoted Paul MacDuff, Pekka Puustinen and Russell Gehrett to partner. Pamplona is a specialist investment manager established in 2005 that provides an alternative investment platform across private equity and single-manager hedge fund investments. The firm has offices in London, Madrid, New York, Boston and Malta.
Martin Bastian is joining global investment bank Houlihan Lokey (NYSE:HLI) in January 2019 as a managing director in the industrials group to lead the chemicals business in Europe, based in Frankfurt. Bastian joins from Citigroup, where he was a managing director with senior coverage responsibilities in Germany and Switzerland, including chemicals sector clients as well as previously head of EMEA chemicals. Prior to Citigroup, he led the chemicals activities in Europe at Credit Suisse. Previous experience also includes a similar role at Goldman Sachs in London and Frankfurt as well as investment banking positions at Merrill Lynch in New York.
David Fergusson has joined advisory firm Generational Group as senior managing director and group leader, M&A. Fergusson will open and lead an M&A office in Manhattan, leading the firm's expansion across the Northeast region and Canada, and establishing a cross-border international practice. Fergusson was previously co-CEO and president of The M&A Advisor.
Sports betting is rapidly gaining traction in the U.S., and that is spurring mid-market deals. Scientific Games Corp. (Nasdaq: SGMS) is buying sports betting data provider Don Best Sports Corp. The deal comes on the heels of the U.S. Supreme Court’s overturning a 1992 federal law that barred most states from authorizing sports betting. The decision could pave the way for states to allow sports gambling. Read the full story, Why sports gaming M&A is about to take off.
The Tennessee Titans take on the Dallas Cowboys on Nov. 5, as NFL Week 9 comes to a close. Off the field, football stars team to build companies. New England 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, which has raised $3 million in venture capital funding from CourtsideVC and Advancit Capital. Many NFL players invest in companies. 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. Mergers & Acquisitions takes a look at star players who invest in companies through private equity, venture capital and other investment vehicles.
Mergers & Acquisitions identifies 15 cities as fertile communities for dealmaking. We look at metropolitan areas from Austin (where Michael Dell launched a PC business out of his dorm room back in the day and where thousands gather every year for SXSW) to St. Louis (home of private equity firm Thompson Street Capital Partners). Be sure to check out Milwaukee (with private equity firm Robert W. Baird & Co. and investment bank Clearly Gull) and Minneapolis (home of strategic buyers 3M, Best Buy, General Mills, Hormel and Target). And don’t forget Boston, Chicago, New York, San Francisco and Los Angeles and more. See our list, Dealmaker's guide to 15 cities where M&A thrives.
Why investors like diversity. "Companies that are inclusive and also diverse tend to outperform companies that aren't," says investor Lorine Pendleton of Pipeline Angels and Portfolia in this video interview shot at Exponent Exchange, a gathering of 200 female dealmakers. Watch the full video: M&A Insights: Inclusion investing.
Acknowledging today’s climate of amplified workplace challenges, private equity firms must consider potential risks, from liability to litigation, before investing, writes Seyfarth Shaw's Gerald Maatman in this guest article. Read the full story: How to mitigate #MeToo risks before you buy.
ACG Chicago's Family Office Conference, held Nov. 8, at the Westin Chicago River North, brings deamakers together for a "deep dive" into family offices. The event features a keynote by Laurent Roux, Gallatin Wealth Management, and panels, including: Current State of Family Office Direct & Co-Investment Activity, with Gary Levenstein, Nixon Peabody; and Impact of Millennial Generation on Family Office Investment Strategy including Social Impact Investing, with Adam Lieb and Tony Oommen, Fidelity Family Office Services.
ACG Florida Capital Connection, held Nov. 12-14, at the Vinoy Renaissance St. Petersburg Resort & Golf Club, puts “sun and fun” into dealmaking for the middle market, bringing together hundreds of dealmakers. The keynote speaker is Forbes Media CEO Steve Forbes, and the featured speaker for the Women’s Forum is Valerie Crites Fowler, who served as a diplomat in the U.S. Foreign Service for over 29 years, reaching the rank of Minister Counselor in the Senior Foreign Service.
Middle Market Week, hosted by ACG New York and held Nov. 26-30 at various locations throughout New York, brings together leading global middle-market dealmaking professionals to develop and enhance their dealmaking activities, strengthen their long-term relationships, and provide numerous opportunities for networking all week long. Mark your calendar for the Private Equity Annual Wine Tasting Gala on Nov. 28 at Gotham Hall. The building was constructed in the 1920s as the headquarters of the Greenwich Savings Bank. The gala brings together the leading middle market private equity firms for an evening of fine wines and networking.