This week three private-equity-related surveys / studies / white papers / whathaveyous were released and we've got the highlights of each. 1. Navigating Your Portfolio Through Turbulent Waters
From Grant Thornton, ACG, and our parent company, Thomson Reuters
The study looks at the state of portfolio companies, probably because there aren't any deals to examine. Interesting findings include stats on markdowns, time spent on portfolio companies, and favored strategies for success in the downturn. The white paper also takes a close look at pooled purchasing for health insurance for portfolio companies.
-Almost half of all survey respondants said their 1% to 25% of their portfolio companies are in covenant default. The survey concludes with a taste of the obvious: "Now more than ever, most private equity firms have both the knowledge and the time to create real value at the portfolio level.
As usual, we have a week’s worth of ratings actions on the debt of LBO-backed companies from the agencies, Standard & Poor’s and Moody’s Investor Services. This week the agencies must’ve been busy confusing all of us with changes to their ratings systems (S&P) and finding buyers for Warren Buffet's stake (Moody's) because there’s only one. Either that, or private equity portfolio companies have magically be relieved of their massive debt burden! Ha. What would I write about then? Anyways, the company in the spotlight is Dutch semiconductor company NXP B.V., backed by AlpInvest Partners, Apax Partners, Bain Capital, Kohlberg Kravis Roberts & Co. and Silver Lake. S&P affirmed the company’s long-term corporate credit rating at ‘CCC’. In light of the company’s distressed debt exchange, lowered the ratings on the company's secured and unsecured notes to 'CC' and placed them on CreditWatch negative while affirming the remaining notes at 'B-'. The company plans to undergo a distressed debt exchange on July 23. S&P calculates that the latest exchanges should have a net $26 million negative impact on NXP's cash balances. Since there’s only one, I dug up a little extra info on this company.
LONDON (Reuters) – Britain’s National Express (NEX.L) has received an all-cash takeover proposal from Spanish major shareholder the Cosmen family and private equity firm CVC Capital Partners, sending its shares up 9 percent. CVC said in a Friday statement it had made the indicative approach, which follows a rejected offer for the bus and train […]
HONG KONG (Reuters) – Three private equity firms have agreed to buy a combined about 10 percent stake of a flagship unit of China UnionPay, as the country’s monopoly card payments service provider aims to go public next year, sources with direct knowledge of the deal said on Friday. CITIC Private Equity, an investment arm […]
NEW YORK (Reuters) – BMG Rights Management, the music venture owned by Bertelsmann and KKR, said on Thursday it has agreed to its first acquisition by buying a catalog of songs including “Who Let the Dogs Out” and “Livin La Vida Loca.” Financial terms of the deal to buy the Crosstown Songs America catalog were […]
The Great Atlantic & Pacific Tea Company (NYSE: GAP) has raised $175 million in PIPE funding from existing shareholders The Yucaipa Cos. ($115m) and Tengelmann Warenhandelsgesellschaft KG ($60m). Tengelmann now holds a 38.6% stake, while Yucaipa holds 27.6 percent.
Integra Telecom Inc., a Portland, Ore.-based CLEC, has agreed to a debt restructuring that would give its lenders an undisclosed equity stake. This would mean dilution for existing shareholders Warburg Pincus, Nautic Partners, BA Capital Investors, Boston Ventures and GE Equity.
Ladder Capital Finance, a New York-based specialty finance company focused on the commercial real estate industry, agreed to acquire Florida community bank FirstCity Bank of Commerce. The purchase price is $8.15 per share, although the total is unknown because FirstCity is private. Ladder Capital was formed last last year with approximately $1 billion in equity and debt capital, co-led by GI Partners and Towerbrook Capital Partners. It recently filed for a $400 million IPO.
Vista Equity Partners has completed its $160 million take-private acquisition of SumTotal Systems Inc., a Mountain View, Calif.-based provider of talent development software. SumTotal stockholders received $4.85 per share.
Now that the weather has finally warmed up, plenty of M&A bankers are hoping the market for deals will as well. We’ve noticed a few more targets coming to market in recent weeks and have compiled a list of some of those we’ve come across. Our sources are various news reports and the Buyouts “Seeking Buyers” list. The following companies (among many others) are either formally considering “strategic alternatives,” reported to be on the block or are rumored to be in sales talks. For prior lists, see below, and send any additions my way. P&G is in late stage talks with Cerberus Capital Management and Warner Chilcott to sell its prescription drug business, according to the Wall Street Journal. Yahoo is considering the sale of Yahoo Small Business and HotJobs.