- Blackstone and Kirkbi acquired insulation firm Armacell from Charterhouse Capital Partners for $3 billion, a 99.6% increase in deal value from the previous week.
- China Mobile acquired fixed-line and broadband businesses from China TieTong for $5.3 billion to meet consumer demand for internet services.
- It was a quiet week for US M&A with just four deals worth $971 million announced, down from 54 deals worth $12.3 billion the previous week.
In this edition of Valuation Insights we discuss retention incentives that are expected to become more mainstream under the new Trump Administration. The article discusses recent high profile cases, such as United Technologies recently announced deal to retain Carrier Corporation's furnace manufacturing facility in Indiana. The most common retention incentives are discussed in the article as well as best practices to improve your prospects for securing them.
Other Topics Covered Include:
• Goodwill impairment trends as highlighted in the Duff & Phelps 2016 U.S. and European Goodwill Impairment Studies • Duff & Phelps' Fifth Annual Transaction Trail Report on M&A and Capital Markets Activity in Southeast Asia • Delaware Chancery Court Case which utilized the Duff & Phelps Valuation Handbook Series as support for its conclusion that the respondent's expert's analysis was more reliable.
The professional recruitment market as a whole has continued the trend from the back end of last year by growing steadily in terms of absolute job numbers by between 5% and 12% so far this year; a good indicator of market sentiment.
We have also found in Q1 2015 versus the same period last year that firms are committed to hiring when they go to market, not just scoping out the possibilities. As you will see in our market breakdown of the legal sector, firms are now moving quickly to secure talent and are offering competitive packages up front to secure the best people.
AtmanCo Inc is on the fast track to become a Canadian leader in interactive solutions. Montreal-based AtmanCo has embarked on ambitious internal and acquisition growth strategy for the years to come.
Retailers can significantly increase and diversify their income streams by using their websites to generate secondaryrevenue - revenue that does not come
directly from main product lines of a company - and thus safeguard and increase revenue using their current websites.
In this edition of Valuation Insights we discuss retention incentives that are expected to become more mainstream under the new Trump Administration. The article discusses recent high profile cases, such as United Technologies recently announced deal to retain Carrier Corporation's furnace manufacturing facility in Indiana. The most common retention incentives are discussed in the article as well as best practices to improve your prospects for securing them.
Other Topics Covered Include:
• Goodwill impairment trends as highlighted in the Duff & Phelps 2016 U.S. and European Goodwill Impairment Studies • Duff & Phelps' Fifth Annual Transaction Trail Report on M&A and Capital Markets Activity in Southeast Asia • Delaware Chancery Court Case which utilized the Duff & Phelps Valuation Handbook Series as support for its conclusion that the respondent's expert's analysis was more reliable.
The professional recruitment market as a whole has continued the trend from the back end of last year by growing steadily in terms of absolute job numbers by between 5% and 12% so far this year; a good indicator of market sentiment.
We have also found in Q1 2015 versus the same period last year that firms are committed to hiring when they go to market, not just scoping out the possibilities. As you will see in our market breakdown of the legal sector, firms are now moving quickly to secure talent and are offering competitive packages up front to secure the best people.
AtmanCo Inc is on the fast track to become a Canadian leader in interactive solutions. Montreal-based AtmanCo has embarked on ambitious internal and acquisition growth strategy for the years to come.
Retailers can significantly increase and diversify their income streams by using their websites to generate secondaryrevenue - revenue that does not come
directly from main product lines of a company - and thus safeguard and increase revenue using their current websites.
Christmas 2015 proved to be a difficult one for UK retail. What happened? We identified four themes that are key to understanding the dynamics of the current retail market and provide a framework for realising exactly the disruption caused by the growth of online
Staffing Industry M&A Landscape - October 2016Duff & Phelps
In the first nine months of 2016, 94 staffing industry M&A transactions were completed by 87 unique buyers. After a slow second quarter, staffing M&A activity reaccelerated in the third quarter of 2016 as sellers took advantage of favorable market conditions and the ample number of buyers interested in making acquisitions in the sector.
Mercer Capital's Value Focus: Auto Dealer Industry | Data as of Mid-Year 2020Mercer Capital
Mercer Capital's Auto Dealer Industry newsletter provides perspective on valuation issues. Each newsletter also includes a macroeconomic trends, industry trends, and guideline public company metrics.
iDeal Magazine is a quarterly publication which is specially produced and written with business owners in mind.
iDeal Magazine highlights some of the most recent deals BCMS has completed, offering a real insight into the mechanical and emotional processes involved with selling a business.
The publication also incorporates industry news, business updates as well as other business related information.
Sign up here http://www.bcmscorporate.com/business-sale-news-magazine
This document draws together our views, observations and analysis of the global trends in the insurance M&A market, including influencing factors and macroeconomic variables.
Our analysis covers five primary regions: Western Europe, North America, Asia, Latin America and the Middle East and North Africa. Each section includes a review and remark on deal activity and current trends, in addition to consideration
of future bearings.
Recruitment process outsourcing; a global growth marketRachel Patton
The Recruitment Process Outsourcing (RPO) market has, over the past decade, greatly benefitted from the dislocations in financial markets caused by the 2007/08 global economic crisis. While corporates lowered headcounts and stripped associated hiring costs in the depths of the crisis, a new dynamic in hiring took prominence as confidence returned to markets. The demand for talent became a business imperative.
However, with the benefits of these ‘passive’ forces now wearing thinner, RPO providers are having to think more creatively and laterally about how they continue to provide value beyond more traditional recruitment arrangements.
In our recent report, we spoke to 10 leading RPO players, along with talent acquisition technology providers and multinational corporates to find out how the RPO model has evolved and their expectations for the next few years.
Find out everything you need to know about Ireland's economy, including the latest mortgage arrears figures, AIB returning to profit for the first time since the crash and which company has revealed it is to sell almost 3% of Bank of Ireland shares.
Christmas 2015 proved to be a difficult one for UK retail. What happened? We identified four themes that are key to understanding the dynamics of the current retail market and provide a framework for realising exactly the disruption caused by the growth of online
Staffing Industry M&A Landscape - October 2016Duff & Phelps
In the first nine months of 2016, 94 staffing industry M&A transactions were completed by 87 unique buyers. After a slow second quarter, staffing M&A activity reaccelerated in the third quarter of 2016 as sellers took advantage of favorable market conditions and the ample number of buyers interested in making acquisitions in the sector.
Mercer Capital's Value Focus: Auto Dealer Industry | Data as of Mid-Year 2020Mercer Capital
Mercer Capital's Auto Dealer Industry newsletter provides perspective on valuation issues. Each newsletter also includes a macroeconomic trends, industry trends, and guideline public company metrics.
iDeal Magazine is a quarterly publication which is specially produced and written with business owners in mind.
iDeal Magazine highlights some of the most recent deals BCMS has completed, offering a real insight into the mechanical and emotional processes involved with selling a business.
The publication also incorporates industry news, business updates as well as other business related information.
Sign up here http://www.bcmscorporate.com/business-sale-news-magazine
This document draws together our views, observations and analysis of the global trends in the insurance M&A market, including influencing factors and macroeconomic variables.
Our analysis covers five primary regions: Western Europe, North America, Asia, Latin America and the Middle East and North Africa. Each section includes a review and remark on deal activity and current trends, in addition to consideration
of future bearings.
Recruitment process outsourcing; a global growth marketRachel Patton
The Recruitment Process Outsourcing (RPO) market has, over the past decade, greatly benefitted from the dislocations in financial markets caused by the 2007/08 global economic crisis. While corporates lowered headcounts and stripped associated hiring costs in the depths of the crisis, a new dynamic in hiring took prominence as confidence returned to markets. The demand for talent became a business imperative.
However, with the benefits of these ‘passive’ forces now wearing thinner, RPO providers are having to think more creatively and laterally about how they continue to provide value beyond more traditional recruitment arrangements.
In our recent report, we spoke to 10 leading RPO players, along with talent acquisition technology providers and multinational corporates to find out how the RPO model has evolved and their expectations for the next few years.
Find out everything you need to know about Ireland's economy, including the latest mortgage arrears figures, AIB returning to profit for the first time since the crash and which company has revealed it is to sell almost 3% of Bank of Ireland shares.
A digital copy of the BH24 (29 January 2016 edition). Zimbabwe's premier business news free sheet published by the Zimpapers Newspapers Group (1980) Limited and available every week day from 15:30hrs to give a summary of the day's business news.
IMAP Financial Services sector Leaders: Jonathan Dalton and Khelan Dattani share insights into the global Financial Services sector. They look at how and why the COVID pandemic affected certain geographies and subsectors more than others and the subsequent impact on deal volumes and valuations. They identify the key areas of growth and common trends driving activity across the globe and examine why the sector is becoming increasingly attractive to PE investors, pinpointing opportunities for buyers and sellers.
This strong appetite for deals perseveres against a backdrop of geopolitical or emerging policy concerns, which are seen as the greatest risk to economic growth for 69% of businesses. Yet according to the Global Capital Confidence Barometer, the disruptive impact of technology on potential deal outcomes and business models remains at the forefront of the minds of the majority of executives.
WHAT IS THE COX AUTOMOTIVE INSIGHT REPORT?
How will the new and used car markets perform during the rest of this year? What will become the future fuel of choice? What are the barriers as we drive towards Mobility as a Service (MaaS)?
In this first annual Insight Report from Cox Automotive and Grant Thornton, we go beyond the headlines to provide our view on the future of our market, and what it means for us all.
Ernst & Young: Capitalizing on opportunities - Private equity investment in o...Marcellus Drilling News
A new survey from EY that shows there is close to $1 trillion in private equity waiting to be invested across all sectors. Some 43% of private equity investors say they are looking to spread some of that money in the oil and gas space.
330 PARTS • KEY STRATEGIC-MANAGEMENT TOPICS DomQ Great in.docxgilbertkpeters11344
330 PARTS • KEY STRATEGIC-MANAGEMENT TOPICS
Do'mQ Great in a Weak Economy. How?
Marriott International
Among all hotels, casinos, and resorts, Marriott International scored the highest on Fortune's
"Most Admired Companies" both in 2007 and 2008.
When most firms were struggling, Marriott made $362
million in net income on $12.88 billion in revenues,
quite impressive for a hotel/motel firm in 2008. Fortune
rated Marriott as their 13th overall "Most Admired
Company in the World" in terms of their management
and performance. Marriott is looking past the current
slump in travel by planning to open 130 new hotels in
the next four years. About half of the new hotels are
targeted for emerging markets such as China, India,
and the United Arab Emirates. The new hotels will add
32,000 rooms to Bethesda, Maryland-based Marriott's
capacity of 560,000 rooms at 3,178 properties. Marriott
declared a new stock dividend in August 2009.
Marriott is one of the world's leading hoteliers, with
some 3,000 properties in more than 65 countries,
including Renaissance Hotels and Marriott Hotels &
Resorts, as well as Courtyard and Fairfield Inn, It also
owns the Ritz-Carlton and time-share properties oper-
ated by Marriott Vacation Club International. Marriott
additionally provides more than 2,000 rental units for
corporate housing and manages 45 golf courses. The
Marriott family, including CEO J. W. Marriott Jr., owns
about 30 percent of the firm.
Marriott prefers to manage rather than own proper- ;
ties. The firm is planning to purchase some of the ;
Greenbrier Hotel Corporation's assets, including its historic \
luxury White Sulphur Springs, West Virginia, resort. Then i
Marriott will sell that property to another hotel owner but ?
maintain management rights to the property Greenbrier )
entered Chapter 11 bankruptcy in 2009, which prompted '
Marriott to offer to acquire some of their assets.
1
Source: Based On Geoff Colvin, "The World's Most Admired i
Companies," Fortune (March 16, 2009): 76-86; Rachel Feintzeig and j
Kris Hudson, "Greenbrier Hotel Seeks Chapter 11, Plans to Sell to i
Marriou," Wall Street Journal (March 20, 2009): B3. ;
As illustrated iti Figure 11-1, global considerations impact virtually all strategic deci-
sions. The boundaries of countries no longer can define the limits of our imaginations.
To see and appreciate the world from the perspective of others has become a matter of
survival for businesses. The underpinnings of strategic management hinge on managers
gaining an understanding of competitors, markets, prices, suppliers, distributors,
governments, creditors, shareholders, and customers worldwide. The price and quality
of a firm's products and services must be competitive on a worldwide basis, not just on
a local basis. As indicated above, Marriott International is an example global business
that performed outstandingly well during the recent global recession.
The World Trade Organizati.
Grow + Sell Your Business Part Three: Practical Tips To Facilitate a TransactionKegler Brown Hill + Ritter
Presented by Eric Duffee and Michael Shaw, Copper Run Capital, on 10/17 as part of a Four Part Series. This segment of the series offered 8 clear steps to follow in pursuit of facilitating a successful transaction. It covered areas such as securing your assets, awareness of current market trends, a visual analysis of our current market update, and surrounding yourself with the right team.
1. 30-Nov-15
30-Nov-2015
Dealspeak
26th Nov-2nd December
30-Nov-15
27-Nov-2015
THUR US$ 1.6bn MONUS$ 194mFRI SAT/SUNUS$ 7.7bn US$ 8.3bn TUES
#Dealspeak
The week in numbers (Global % increase/decrease in value compared to 19th-25th November)
30-Nov-15
99.6%
US$ 3.0bn
Insulation firm swaps hands between two PE firms China’s broadband revolution takes shape
44.3% 64.2% p15.3%
US$ 65m
A sleepy week for US M&A Shake up in Chinese construction sector
6.8% 47.4% 98.3% p200.6%
Stories of the week
Sector breakdown
US$385m
US$5.3bnUS$4.0bn
US$
1.0bn
US$780m
TMT Industrials & Chemicals Consumer Financial Services PMB EMU Real Estate Construction
US private equity firm Blackstone, in partnership with small
Danish-based Lego owner Kirkbi, has agreed to acquire high-tech
insulation firm Armacell from current owner Charterhouse Capital
Partners in a secondary international buyout.
According to Mergermarket Intelligence, a number of stategics and
financial sponsors were circling the target in the auction process,
including Cinven, Carlyle, Astorg Partners and Pamplona.
Hong-Kong listed China Mobile Ltd has acquired the fixed-line
and broadband business from China TieTong for US$ 5.3bn, in
an attempt to meet consumer demand for more efficient internet
services.
According to a company statement, the purchase gives China-mobile
approximately 11.9m fixed broadband customers and 18.3m fixed
line customers.
The largest deal targeting the US this week was
the US$ 780m domestic acquisition of Sleepy’s
by MattressFirmHoldingCorp.
The consolidated company will receive an
estimated US$3.6bn in annual sales and 3,500
stores, according to a statement from Mattress Firm.
It has been a quiet week for US M&A, with just four
deals worth US$971mannounced, downfrom54
deals worth US$ 12.3bn the previous week.
Truworths, the listed South Africa-based fashion
retailer, has agreed to acquire Office Holdings
Limited, the UK-based footwear retailer, from
Silverfleet Capital Partners, the UK-based
private equity firm, for US$ 385m.
Silverfleet has achieved a 3.4x return from the
sale of Office Holdings. The private equity has
also recently invested in Danish womenswear
clothing brand, Masai Clothing Company,
announced in June 2015.
Hainan Island Construction has agreed to
acquire HNA Infrastructure Industry Group
from its controlling shareholder,
HNAInfrastructureIndustryGroup,forUS$4.0bn.
Following the acquisition, Hainan Island
Construction plans to invest and develop a
range of infrastructures, including ports, roads
and airports, it said in a statement.
Daily deal values
WED
Silverfleet triples returns from retail sale
2. Mamakote Ramathe is currently Executive Head within
Vodacom Group’s M&A division, responsible for evaluating and
executing acquisition opportunities and any other corporate activity in
South Africa. Her career history includes working for Cazenove Corporate
Finance, National Empowerment Fund, Vantage Risk Capital and the
Development Bank of Southern Africa.
League tables: 26 Nov-02 Dec 2015 vs. 2014
Editorial snapshot
Quote of the week
“The drive to invest is seeing real
momentum, and it is hard to see it
stopping anytime soon.”
Patrick Sarch, Clifford Chance
3M Company, the Minnesota-based diversified
technology company, is interested in making
acquisitions in the healthcare, industrial and
personal safety areas, CFO Nicholas Gangestad
said on Tuesday:
“Would I consider acquisition targets that would
move our return on invested capital for a period
of time below 20%? Yes,”he said at a conference,
“as long as we were convinced that 3M would be
adding significant value as a part of that deal.”
Corporate Interview: South Africa focus
2015/(2014)
1/(-)
2/(9)
3/(32)
UBS Investment Bank p
Morgan Stanley
Guotai Junan
Securities Co Ltd
p
Financial Advisers
Legal Advisers
1/(26)
2/(-)
3/(7)
US$ 5.4bn
US$ 5.0bn
US$ 2.2bn
King&WoodMallesons p
Scotto&Associates p
Simpson Thacher
& Bartlett
US$ 2.1bn
US$ 1.0bn
US$ 1.0bn
RBC found guilty of faulty advice
Royal Bank of Canada has been ordered to pay
an estimated US$ 75m in fines following advice
during their sale of Rural/Metro Corporation to
Warbung Pincus in 2011.
According to a court document, RBC had“aided
and abetted breaches of fiduciary duty by
former directors”, at the expense of Rural/Metro
Corporation shareholders, pushing for a quick
sale rather than advising the seller to seek a
higher price.
What over-riding trends do you see driving M&A
within South Africa’s telecommunications sector?
South African’s telecommunications landscape is
characterised by a rather more mature mobile market
with SIM card penetration rate at more than 150%.
Mobile operators have been experiencing downward
pressure in the pricing of mobile voice and core service
offering; this has triggered the need to develop new
solutions and offerings beyond
traditional revenue sources.
Interesting deals within the
space include the proposed
MTN and Telkom network
sharing deal that eventually
did not receive the support of
the Competition Authorities.
There was also the Telkom and
BCX transaction aimed at positioning Telkom to growing
beyond its core connectivity business while expanding
its existing offering by providing scale in IT services.
MTN’s acquisition of Internet Service Provider, Afrihost,
sought to grow Afrihost’s customer base while leveraging
its investment in broadband.
These deals have the effect of enabling operators to
beef up their networks through both infrastructure
and spectrum allocation, so as to meet the growing
consumer demand for data and to move closer towards
offering integrated services. Operators find themselves
in a position where they need constantly innovate and
find ways to distinguish themselves from competitors in
order to acquire and retain customers, and to streamline
existing operations.
“The valuation of a business must
be reflective of growth potential
to avoid overpaying. You cannot
underestimate the importance of
knowing and aligning with your key
stakeholders and choosing the right
partners.”
Mergermarket data shows that South Africa has
been more acquisitive this year, particularly outside
of the continent. What do you think is driving this?
South Africa is experiencing low economic
growth, slowing demand from exports, increasing
unemployment and financial pressure on consumers,
as well as a decline in commodity markets affecting
our energy and mining sectors. Such weakening
macroeconomic conditions and
unfavourable exchange rate
movements continue to impact
financial performance for a
number of businesses operating
in the country.
The picture creates an
opportunity for established
South Africa-based companies to begin to look
elsewhere for growth opportunities, as the ability to
make successful acquisitions across different sectors is
hampered by some of these challenges.
We have seen some interesting deals being announced
where South African based companies have made
acquisitions abroad. Deals such as Oceana Group
buying US-based fisheries for US$ 382.3m, Brait’s
proposed acquisition of Britain’s New Look for R14.2bn,
Woolworth’s acquisition of Australia’s David Jones for
R21.4bn and Brait’s acquisition of an 80% stake in
Virgin Active gyms.
And finally, what is your outlook for South African
M&A in 2016? Do you think its strong M&A activity
will continue?
The South African economic outlook is challenging
and there are sectors that are specifically hard hit such
as mining, on the back of declining commodity prices,
as well as lower export demands from China affecting
the industrial sector. Rising interest rates, increasing
unemployment, and declining consumer demand will
have a negative impact on both the consumer and
financial services sector.
I expect opportunities for M&A activities in 2016 to be
driven by potential consolidation as companies seek
to rationalise costs and streamline operations while
getting rid of redundancies in capacity. This situation
could play itself within the mining resource sectors.
Companies that offer new innovative solutions for
addressing consumer demands and business needs will
position themselves as attractive acquisition targets, as
they provide growth potential for companies looking to
grow additional sources of revenue.
What key qualities fo you look for when sourcing an
acquisition?
Attractive acquisition opportunities provide a compelling
growth story and synergistic value, with the ability to
generate sustainable profits. The economic environment
must be conducive for growth, and there must be a clear
plan for a well-run business with capable management
able to execute on the strategy of the merged entity.
The valuation of a business must be reflective of
growth potential to avoid overpaying. You cannot
underestimate the importance of knowing and aligning
with your key stakeholders and choosing the right
partners. It is important to understand the political and
social environment the target company is operating
in and have the right partnerships with contractual
arrangements that foster an alignment of interests
between parties.
“Attractive acquisition opportunities
provide a compelling growth story
and synergistic value, with the ability
to generate sustainable profits.”