M&A wrap: Tesla, GTCR, Riverside, Centre Partners, Ardian

Register now

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.

For Elon Musk and Tesla Inc. (Nasdaq: TSLA), "the blows from Wall Street came one after another this week -- a relentless barrage that left the stock so beat up that some now wonder if it can ever regain its status as the ultimate 21st century disrupter," reports Bloomberg News. A Wedbush analyst said the carmaker is facing a “code red situation,” casting doubt on whether Tesla can sell enough of its electric cars to make a profit. And Citigroup and Robert W. Baird & Co. analysts, among others, slashed their target prices, citing concerns about cash flow and demand from consumers. “Demand is at the heart of the problem,” said a Morgan Stanley analyst. Once a growth story, Tesla is now more of a “distressed credit and restructuring story." One risk is in China, where Tesla has a big focus at a time of increasing trade tensions and more local competition. Read the full story, Tesla faces a"code red situation," say analysts. Read the full story by Bloomberg News: Tesla faces a"code red situation," say analysts.

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.

DEAL NEWS
Invesque is buying 20 assisted living and memory care communities from Commonwealth Senior Living for $340.4 million. BMO Capital Markets was the financial advisor to Invesque, and Houlihan Lokey Capital was the advisor to Commonwealth.

Amgen (Nasdaq: AMGN) is acquiring Copenhagen-based biopharma company Nuevolution for 1.61 billion Swedish kronor ($167 million). Nuevolution has a patent protected drug research platform to identify small-molecule drug candidates to be taken as pills to potentially treat cancer.

Ardian has acquired a majority stake in Swiss pharmaceutical company Sintetica. The target specializes in research, manufacturing and marketing of sterile injectable products, mainly in anesthetics and analgesics

Centre Partners-backed Golding Farms Foods, which makes sauces and condiments, has acquired Arcobasso Foods, a manufacturer of refrigerated dressings, sauces and beverage mixers.

For more deal announcements, see Weekly wrap: HPE, JPMorgan, Kelso.

For more on PE fundraising, see PE fundraising scorecard: Accel-KKR, General Atlantic, GSO.

FEATURED CONTENT
Genstar Capital, Audax and HarbourVest ranked as the top U.S. private equity firms of 2018, based on volume of completed deals, according to PitchBook. Check out Mergers & Acquisitions' profiles of 21 firms that led the league tables. Top private equity firms: Genstar, Audax, HarbourVest.

Also see: Top investment banks in PE-backed deals: KPMG, Houlihan, GS, William Blair.

At least two-thirds of U.S. homes have at least one pet, and people are spending more money on their pets than ever, driving M&A across the entire pet care sector. Read the full story: Demand for animal health products and services rises, driving deals.

One of the most significant opportunities to impact the success of due diligence is understanding how to leverage data. In today’s market, the ability to tap into the volume and variety of big data can provide private equity stakeholders with the competitive edge in operational due diligence. Read the full guest article by Maine Pointe's Mark McTigue and Nathanael Powrie: How data can help PE accelerate value at due diligence.

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 New York, ACG Boston and ACG Philadelphia 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.

ACG Minnesota hosts the the Upper Midwest ACG Capital Connection at the Renaissance Minneapolis Hotel, The Depot, June 10-11.

ACG Boston brings together 700-plus dealmakers for DealFest Northeast and DealSource Select 2019 at the Cyclorama and the State Room, June 12-13.

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.

For reprint and licensing requests for this article, click here.