M&A wrap: Thoma Bravo, Veracode, Apttus, Centrify, PHC Holdings, Century Park
Thoma Bravo has raised its 13th fund at $12.6 billion. The fund underscores private equity firms’ enthusiasm for backing companies that provide software and technology-enabled services and will allow "Thoma Bravo to continue to pursue its proven investment approach of owning and building high quality software companies," the firm says in a release. "Our firm has a long history and proven track record of bringing innovation and growth to our software companies,” says Thoma Bravo managing partner Orlando Bravo. “The number and size of private equity investment opportunities in enterprise software and technology is expanding." Thoma Bravo is led by managing partners Orlando Bravo, along with managing partners Seth Boro, Scott Crabill, Lee Mitchell, Holden Spaht, Carl Thoma and partners Jack Le Roy, Robert Sayle and Hudson Smith, and has offices in Chicago and San Francisco. Since 2003, Thoma Bravo has completed over 200 software and technology acquisitions worth around $57 billion. In 2018, Thoma Bravo made 12 investments and also raised a $2.4 billion middle-market fund. Some of the firm's recent deals include: acquiring security testing company Veracode for $950 million; taking a majority stake in business automation company Apttus; and invested in cybersecurity firm Centrify.
Technology permeates many of today’s private equity deals, and PE 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. “Technology, in and of itself, is invading every end market, and it is driving companies to be more competitive than their peers,” points out Richard Lawson, CEO of tech-focused PE firm HGGC. As PE firms consider the tech landscape, they are watching Amazon.com Inc. (Nasdaq: AMZN) closely. “We are always thinking about how we can help companies that are going to get dislocated and disintermediated by Amazon,” says Lawson. “End markets everywhere are being changed by Amazon. As Amazon scales, it will challenge all kinds of industries and it will have a cascading effect across all sectors. You are already seeing more companies trying to connect their brands with consumers in new ways.” 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.
Deadline approaches. Submit nominations by Feb. 8 for Mergers & Acquisitions' 12thAnnual M&A Mid-Market Awards, which will honor leading dealmakers and deals that set the standard for transactions in the middle market in 2018. Click here to submit nominations.Looking at past winners provides a good guide to what we’re seeking. Last year’s winnersincluded Campbell Soup, Huron Capital, Idera, LLR Partners, McGuireWoods, Stryker, Twin Brook and William Blair.
PHC Holdings Corp. is buying Thermo Fisher Scientific Inc.'s (NYSE: TMO) anatomical pathology business for $1.14 billion. The business provides microscope slides and other medical equipment.
Century Park Capital Partners has invested in MCCi LLC, a software company that offers enterprise content management and business process automation. VRA Partners advised MCCi. Winston & Strawn and Crowe LLP advised Century Park. RGA Private Debt & Equity and Plexus Capital provided financing.
Arlington Capital Partners is buying Triumph Fabrications from Triumph Group Inc. (NYSE: TGI). The target produces metal parts for the aerospace sector. Lazard (NYSE: LAZ) is advising Triumph. Gibson, Dunn & Crutcher LLP is advising Arlington.
Betram Capital has acquired flow control and fluid handling company Flow Control Group from AEA Investors SBF.
GI Partners has bought two data centers from NTT Data. One is located in Plano, Texas and the other in Quincy, Washington.
Hg is buying a majority stake in logistics firm in Transporeon Group from TPG capital.
Huron Capital-backed Pueblo Mechanical & Controls has acquired Newgaard Mechanical Inc. and CFM Mechanical LLC.
MidWest Growth Partners has raised its second fund at $113.5 million. The PE firm focuses on the food and agriculture, business services, distribution and logistics and manufacturing sectors.
GameStop Corp. (NYSE: GME) said it has stopped an effort to sell itself, citing a lack of available financing at terms a buyer would find acceptable. Read the story: GameStop ends effort to sell itself.
Rachel Diller was hired by Hunt Capital Holdings as a senior managing director and head of private real estate equity strategies. Diller previously founded real estate investment firm UrbanView Capital.
Bob Lockwood was hired by Lincoln International's technology, media and telecom group as a managing director where his concentrating on the Internet and digital media sectors. He was most recently with Raymond James & Associates.
Alan Noskow has joined King & Spalding as a partner where is focusing on private equity and M&A. Noskow was most recently with Manatt, Phelps & Phillips.
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. "Actively lobby and ask from day one to work on deals, so you can gain dealmaking experience early in your career," advises Bradley. "Too often, women are steered into functions like marketing, business development, and investor relations – the 'softer side' where it is easier to place a female. The excuse often used is that the females don’t have the deal experience of their male counterparts. That is why you must be an advocate for yourself and work on deals from the very beginning."
Mergers & Acquisitions asked leading dealmakers about their outlook for the middle market in 2019. Watch the video conversations, shot at ACG Philadelphia's M&A East: It is a seller's market, and deal activity is expected to remain steady, says Ramsey Goodrich of Carter Morse & Goodrich: Outlook 2019: Great time to sell. Private equity firms and strategic buyers will use their excess cash and capital to look for deals, says Bharat Ramprasad of Stifel Nicolaus: Outlook 2019: Excess capital to fuel M&A. Rising interest rates and regulatory changes may increase volatility, cautions Mark Emrich of Murray Devine: Outlook 2019: Keep an eye on rising interest rates.
Family-owned businesses require a lot preparation to sell to PE firms, says Carls Marks Advisors' Warren Feder.Watch the video: How to prep a family biz for sale to private equity.
The New England Patriots and the Los Angeles Rams will face off in the Super Bowl. Off the field, 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. 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. Check out: NFL stars Tom Brady, Michael Strahan, Steve Young go PE.
ACG Boston, ACG Connecticut, ACG New Jersey, ACG New York & ACG Philadelphia host ACG Northeast Dealmaking at the Mountain at Stowe Mountain Resort in Stowe, Vermont Jan. 27-29. The event provides a chance for middle-market M&A professionals from across the northeast to come together for two days of close knit networking, shared conversations and valuable time spent to deepen your relationships within the deal community.
ACG New York hosts its 11th annual healthcare conference at the Metropolitan Club in New York on Feb. 28. Dealmakers get to network with healthcare-focused private equity firms and other industry professionals.
ACG Minnesota and Corvus North are hosting AIM: A Women's Leadership Conference at the Minneapolis Hyatt on March 7. The conference is designed to support and encourage female leaders to grow and achieve success throughout their career journeys.