Capital Calls: Embracer fail dents credibility 24 May 2023 Concise views on global finance: Shares in the $3 bln maker of shoot-’em-up video games fell nearly 45% after a mystery partnership agreement fell through at the eleventh hour.
Capital Calls: Buyout loans 23 May 2023 Concise views on global finance: The termination of broadcaster Tegna’s sale to Standard General lets banks off the hook for funding some $8 bln in buyout debt, but clearing the pile of hung loans is just one part of the leveraged finance problem for big lenders.
Activist Yelp review is worth hearing out 23 May 2023 TCS Capital wants the local listings site to explore a sale, pitching a tie-up with Barry Diller’s home-services rival Angi. A targeted $70-per-share price – double Yelp’s current valuation – seems absurdly high. But potential cost savings make the combo an intriguing blueprint.
SoftBank pulls rabbits out of Fortress’s hat 23 May 2023 Boss Masoyoshi Son appears to be selling the money-losing Japanese conglomerate’s US alternative asset manager for at least double the valuation initially touted. There should be enough tricks left over for new majority owner Mubadala. But Fortress staff get the best of the deal.
Mizuho will find M&A history rhymes at Greenhill 22 May 2023 The Japanese giant is expanding rapidly in merger advice by acquiring the boutique for $550 mln. Striking during a dry spell means a lower cost and less chance of bankers leaving. Dealmakers blind to the risks of their own deals, however, has caused decades of disappointment.
A&O Shearman could live down to expectations 22 May 2023 UK law firm Allen & Overy is merging with New York's Shearman & Sterling. Creating the world's third largest legal practice with $3.4 bln in revenue could please big clients after a transatlantic service. But judging by past sector M&A, it could also create dis-synergies.
Revolut-SoftBank fight exposes VC share artifice 22 May 2023 The fintech group may only win a UK banking licence if it gets rid of preference stock held by the Japanese investor. Similar structures are common in startup land, and help justify puffed-up valuations like Revolut’s $33 bln price tag. The fracas shows they also have a downside.
SPAC addict finds a healthier formula in London 18 May 2023 Serial dealmaker Martin Franklin was into blank-check vehicles before it was cool. His new $550 mln buyout-inspired group dispenses with the egregious free shares insiders get in special purpose acquisition companies. The downside is that investors can’t stop Franklin if he errs.
Capital Calls: BT, Mediobanca 18 May 2023 Concise views on global finance: The 14 bln pound UK telco’s vague guidance is a concern for its two big shareholders seeking to recoup losses; the 8.5 bln euro Italian bank buys its biggest boutique yet.
UBS kitchen sink has protection from further leaks 17 May 2023 The bank reckons it might write down the assets on Credit Suisse’s balance sheet by $10 bln, inflate its liabilities by $3 bln, and take a $4 bln litigation hit. Those numbers could get bigger over time. But a low purchase price gives CEO Sergio Ermotti a chunky margin of error.
Center Parcs buyout would offer low thrills stay 17 May 2023 Brookfield plans to sell the British holiday park operator for up to 5 bln pounds. The company’s unique assets and brand loyalty have made it an appealing asset for private equity. But its own limits on expansion and Britain’s cost-of-living crisis may now dent returns.
Drug M&A comes down with case of antitrust fever 17 May 2023 Amgen’s $28 bln purchase of rival Horizon could unfairly boost the target’s treatments, the merger watchdog says. The FTC’s focus on so-called bundling could be troublesome for the pharma industry, but is also hard to prove. Investors may be too pessimistic about the deal.
Activision is victim of clashing trustbuster whims 16 May 2023 Microsoft’s bid for the “Call of Duty” maker won Europe’s approval, with concessions, after UK and US regulators pushed back. International enforcers’ divergence on whether companies can offer fixes for deals they don’t like could be an impossible hurdle for big-ticket M&A.
Capital Calls: GAM takeover saga 16 May 2023 Concise views on global finance: The stricken fund group is an unlikely target for activists led by billionaire telecoms tycoon Xavier Niel.
Gautam Adani’s fundraisings offer multiple tests 16 May 2023 His companies are preparing to tap capital markets for some $3 bln, three months after a short attack succeeded in obliterating $120 bln and 50% off his group’s value. It will test the Indian conglomerate’s reputation, his attitude to public equity, and the besieged regulator.
TPG returns to credit party fashionably late 15 May 2023 The buyout firm’s $3 bln purchase of direct-lending firm Angelo Gordon takes it back into a business it split off in 2020, and will make it look more like bigger peers like KKR. Missing the last private-credit wave is no bad thing, since TPG could catch the crest of the next one.
Capital Calls: Wood Group 15 May 2023 Concise views on global finance: Apollo’s aborted bid for the $1 bln UK infrastructure firm prompted a 35% share price fall.
Vietnam’s Tesla debuts with wrong kind of power 15 May 2023 VinFast is going public at a sales multiple seven times its rival. Merging at a $27 bln valuation with casino mogul Lawrence Ho’s SPAC secures it a listing in the US where the electric-vehicle maker is expanding. But it needs funding and an inflated 2021-style deal doesn’t help.
Mattress M&A is stuffed with sweet dreams 10 May 2023 Tempur Sealy’s $4 bln deal to buy retailer Mattress Firm could be a nightmare to get past trustbusters. Financially speaking, there’s cushion for error. Plus, after the industry struggled with both brick-and-mortar and direct-to-consumer strategies, they make logical bedfellows.
KKR’s $10 bln medical deal overlooked risk factors 10 May 2023 Since the 2018 buyout that larded Envision Healthcare with debt, it has struggled with Covid-19, hypertension induced by feisty insurers and rehab on its billing practices. Bankruptcy is now the prescription. It’s a reminder to beware combining operational and financial leverage.