M&A wrap: Riverside, Thermo Fisher, OpCapita, Maurices, Ascena

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Always a prolific seller, the Riverside Co., led by Béla Szigethy and Stewart Kohl, excelled in 2018 when it came to the total number of exits and the increase in value they represented, earning the firm Mergers & Acquisitions' 2018 M&A Mid-Market Award for Private Equity Seller of the Year. The firm, based in Cleveland and New York, completed 16 exits, including three of the top five exits in its history, in terms of proceeds for investors. Marking its 30th anniversary, Riverside enjoyed growth in other areas as well, making 60 investments, compared with 44 the previous year, and delivering a record fundraising year, raising more than $2.1 billion. Riverside’s Micro-Cap Fund V hit its hard cap of $1.2 billion in capital commitments in less than four months, with demand exceeding the hard cap by more than 50 percent. Riverside takes pride in its role as an advocate for the good it says private equity delivers to the economy, companies, customers and their employees. The firm takes part in visits to Capitol Hill, delivers columns, editorials and speeches touting the effectiveness of private equity, and has many team members serving in advocacy roles at industry organizations. Contributing to the community has been a hallmark of Riverside since the firm’s inception. Two years ago, the firm formally launched its Global Volunteer Program, which Mergers & Acquisitions featured in our story, The Big Give.

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

Related: Read more about Mergers & Acquisitions' three annual special reports, including the M&A Mid-Market Awards, the Rising Stars of Private Equity, and the Most Influential Women in Mid-Market M&A.

Deal news
Thermo Fisher Scientific Inc. (NYSE: TM) is acquiring Brammer Bio, a biopharmaceutical contractor and manufacturing company, from Ampersand Capital Partners for $1.7 billion. “Gene therapy is an area of increasing focus for our customers and is fast-evolving given its potential to treat a range of genetic disorders," says Thermo Fisher CEO Marc Casper. The sellers are being advised by Goodwin, which earned Mergers & Acquisitions' 2018 M&A Mid-Market Award for Law Firm of the Year.

European private equity firm OpCapita Consumer Opportunities Fund II LP is buying a majority stake in women's apparel retailer Maurices Inc. from Ascena Retail Group Inc. (Nasdaq: ASNA), in a deal that values the target at $300 million. The divestiture is part of Ascena's strategy of reviewing the entire company's portfolio. “Structural changes in our industry have impacted a number of retailers," says Ascena CEO David Jaffe. "We have not been immune to these challenges." Advisors to OpCapita include: PJ Solomon and Clifford Chance US LLP. Advisors to Ascena include: Guggenheim Securities and Proskauer Rose.

Sagewind Capital-backed By Light Professional IT Services LLC has acquired Phacil Inc., a diversified software, cybersecurity, systems engineering and managed services provider to the U.S. Government. Phacil is being advised by The McLean Group.

For deal announcements, see The weekly wrap: FIS, Janney, Peak Rock.

For more on PE fundraising, see PE fundraising scorecard: Allegiance Partners, Maven Equity, Tower Arch.

People moves
Beth Pickens was hired by TSG Consumer Partners as a principal, where she is based in the PE firm's new London office. Pickens was previously the head of European consumer banking at William Blair.

Featured content
The NCAA Tournament has gone from 68 to 16 teams, with all four No. 1 seeds, including overall No. 1 seed Duke University remaining in the Sweet 16. This year, March Madness offers fans unprecedented access to online betting, thanks to a May 2018 U.S. Supreme Court ruling. More Americans are expected to place bets on the college basketball tournament than the Super Bowl, with the American Gaming Association's predicting that about $8.5 billion in wagers will be placed on the tournament. Online betting and data companies, including sportsbooks from DraftKings, FanDuel and Caesars, are drawing basketball fans and interest from investors. M&A is rampant throughout the sector. Here's a look at recent online gaming and sports data deals.

Related: March Madness: DraftKings, FanDuel, Action Network draw fans, dealmakers.

What’s driving adaptive reuse, and how can private equity tap into this increasingly common but misunderstood and under-analyzed property segment? Adaptive reuse, which involves repurposing a building designed originally for something else, is fast becoming a global phenomenon; from turn-of-the-century warehouses to castles to train stations, developers and investors have untapped enormous value from obsolete building stock.

Related: Why private equity investors should consider adaptive reuse.

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.

Related: 10 private equity firms share strategies for tech M&A.

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.”

Related: 7 reasons why smart companies Amazon, Nike, Target are doing M&A.

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 investment banks in private equity-backed deals. The list is based on volume of completed PE-backed 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.

Related: Top investment banks in PE-backed deals: KPMG, Houlihan, GS, William Blair
Related: M&A soared in 2018; companies confident about dealmaking in 2019.

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
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.

InterGrowth 2019 is taking place from May 6-8 at the Waldorf Astoria & Hilton Bonnet Creek in Orlando, Florida.

Innovation Works is holding its second annual AI/Robotics Venture Fair in Pittsburgh from on May 15 and 16.

ACG New York, ACG Boston and ACG Philadlephia are holding the Industrial Conference with Value Creation at the Infor in New York on June 6. The event is part of the Northeast Industry Tour.

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