Zephyr Monthly M&A Report North America, July 2014

Zephyr Monthly M&A ReportNorth America, July 2014

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Zephyr is a database of M&A, IPO, private equity and venture capital deals with links to detailed financial information on companies. For more information visit www.zephyrdealdata.com.

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Page 1 © Zephyr

The following report details mergers and acquisitions activity in North America in July 2014 using data from the Zephyr database.

It focuses on deal activity by target company.

Click here to access the raw data in an Excel spreadsheet.

North American M&A driven by big takeovers

The value of mergers and acquisitions (M&A) targeting North American companies rose by 16 per cent in July, boosted by big-ticket deals in the US.

There were 1,296 transactions worth a combined USD 166,449 million over the four weeks, compared to 1,467 deals worth an aggregate USD 143,584 million in June. While volume was 12 per cent weaker, in monetary terms the result was the third-highest of 2014 so far.

Year-on-year, value was 49 per cent higher in the month under review (July 2013: USD 111,692 million) while volume was slightly down on the 1,326 transactions signed off 12 months ago.

M&A targeting the US once again bolstered the region’s overall results, as value climbed 18 per cent over the four weeks from USD 129,540 million to USD 152,292 million. Value was also higher than at the same time a year ago (July 2013: USD 93,495 million).

Three consecutive months of growth in Canada was halted in July, as value fell 15 per cent to USD 14,314 million (March: USD 8,633 million; April: USD 11,798 million; May: USD 15,864 million), and was down by a fifth compared to the USD 18,196 million-worth of M&A announced a year ago.

North America deals by volume and value

Announced date No of deals Total deal value (mil USD)

Jul-14 1,296 166,449

Jun-14 1,467 143,584

May-14 1,443 179,552

Apr-14 1,429 112,403

Mar-14 1,406 87,812

Feb-14 1,295 197,106

Jan-14 1,581 109,422

Dec-13 1,385 133,687

Nov-13 1,245 85,590

Oct-13 1,397 107,965

Sep-13 1,210 212,149

Aug-13 1,255 106,846

Jul-13 1,326 111,692

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US deals by volume and value


Jul-14 1,046 152,292

Jun-14 1,156 129,540

May-14 1,133 163,688

Apr-14 1,141 100,644

Mar-14 1,110 80,039

Feb-14 1,020 181,375

Jan-14 1,279 101,273

Dec-13 986 123,431

Nov-13 909 71,854

Oct-13 1,066 98,967

Sep-13 913 206,978

Aug-13 959 99,043

Jul-13 1,008 93,495

Canada deals by volume and value


Jul-14 251 14,314

Jun-14 314 16,918

May-14 311 15,864

Apr-14 290 11,798

Mar-14 299 8,633

Feb-14 277 15,699

Jan-14 302 8,149

Dec-13 399 10,326

Nov-13 337 13,736

Oct-13 331 8,998

Sep-13 296 5,171

Aug-13 295 7,803

Jul-13 320 18,196









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North America deals by volume and value

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Cigarette deal smashes USD 20,000 million-barrier

Tobacco giant Reynolds America agreed to buy rival Lorillard for USD 27,400 million, including assumed debt, in a bid to challenge the dominance of Marlboro-maker Altria Group.

The deal will add Lorillard’s popular Newport menthol cigarette brand to Reynolds’ portfolio, which includes Camel and Pall Mall. However, the number two tobacco company in the US must also shed assets in order to appease regulators and will dispose of brands such as blu electronic cigarettes to Imperial Tobacco.

This one transaction accounted for 16 per cent of the region’s M&A value in July and was worth more than the number two, three and four deals by value, combined.

The second-highest valued transaction of the month was Dollar Tree making a takeover offer worth USD 9,200 million, including the assumption of debt, for rival Family Dollar in a deal that will unite two of the largest discount retailers in the US. Dollar Tree is offering USD 74.50 in cash and stock for each share held in the North Carolina-based company, a 23 per cent premium to its previous close.

In all, 11 of the top 20 deals by value were public takeovers of which all but one targeted US companies.

US targets favoured by PE firms

Two of the top 20 private equity and venture capital (PE and VC) transactions targeting North American companies in July were worth more than USD 1,000 million. Highest of these was Energy Capital Partners buying Wheelbrator Technologies, a waste-to-energy company based in New Hampshire, for USD 1,940 million. This was one of two deals in which Energy Capital Partners invested, the other being a USD 160 million funding round for Texan oil and gas company Furie Operating Alaska.

The region’s number two PE and VC deal by value in July was Onex Corporation acquiring York Risk Services Group, a privately-held insurance claims handling and loss adjustment company based in New Jersey, in a tertiary buyout from Abry Partners for USD 1,325 million.

Despite the fact that Onex is a Canadian investment company, no Canadian companies were targeted in any of the month’s top 20 PE and VC deals by value.









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Top 20 deals by value

Deal value (mil USD) Deal type Target Target

country Acquiror Acquiror country Deal status

1. 27,400 Acquisition 100% Lorillard Inc. US Reynolds American Inc. US Pending

2. 9,200 Acquisition 100% Family Dollar Stores Inc. US Dollar Tree Inc. US Pending

3. 8,709 Acquisition 100% Salix Pharmaceuticals Ltd US Cosmo Technologies Ltd IE Pending

4. 8,552 Acquisition 100% The Hillshire Brands Company US Tyson Foods Inc. US Announced

5. 7,100 Acquisition Lorillard Inc.'s certain assets; Reynolds American Inc.'s certain assets

US; US Imperial Tobacco Group plc GB Pending

6. 6,400 Acquisition 100% International Game Technology Inc. US GTECH plc GB Pending

7. 6,206 Acquisition 100% Rockwood Holdings Inc. US Albemarle Corporation US Pending

8. 6,000 Acquisition 100% URS Corporation US AECOM Technology Corporation US Pending

9. 6,000 Acquisition 100% Kodiak Oil & Gas Corporation US Whiting Petroleum Corporation US Pending

10. 5,271 Acquisition Abbott Laboratories Inc.'s non-US developed markets speciality and branded generics businesses in Europe, Japan, Canada, Australia and New Zealand

JP; CA; AU; NZ

New Moon BV NL Pending

11. 4,700 Minority stake Reynolds American Inc. US British American Tobacco plc GB Pending

12. 3,678 Acquisition increased from 44% to 100%

Bell Aliant Inc. CA BCE Inc. CA Announced

13. 3,500 Acquisition 100% Trulia Inc. US Zillow Inc. US Pending

14. 3,400 Acquisition 100% OneWest Bank NA US CIT Group Inc. US Pending

15. 3,000 Acquisition 100% QR Energy LP US BreitBurn Energy Partners LP US Pending

16. 1,940 IBO 100% Wheelabrator Technologies Inc. US Energy Capital Partners LLC US Pending

17. 1,725 Acquisition 100% Seragon Pharmaceuticals Inc. US Genentech Inc. US Announced

18. 1,625 Acquisition 100% Severstal Columbus LLC US Steel Dynamics Inc. US Pending

19. 1,500 Acquisition 100% Russell Stover Candies Inc. US Chocoladefabriken Lindt & Spruengli AG CH Announced

20. 1,325 IBO 100% York Risk Services Group Inc. US Management; Onex Corporation; Investors CA Pending









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Top 20 private equity deals by value

Deal value (mil USD) Deal type Target Target

country Equity provider Deal status

1. 1,940 IBO 100% Wheelabrator Technologies Inc. US Energy Capital Partners LLC Pending

2. 1,325 IBO 100% York Risk Services Group Inc. US Onex Corporation Pending

3. 890 IBO 100% Eco Services LLC US CCMP Capital Advisors LLC Announced

4. 850 Minority stake 25% Freeport LNG Development LP US Global Infrastructure Management LLC Announced

5. 700 IBO majority stake NVA Holdings Inc. US Ares Management LP Announced

6. 680 Minority stake Preferred Sands LLC US Kohlberg Kravis Roberts & Company LP Announced

7. 500 IBO 100% Mister Car Wash Holdings Inc. US Leonard Green & Partners LP Completed

8. 480 IBO 100% Cole-Parmer Instrument Company US GTCR Golder Rauner LLC Pending

9. 465 IBO 100% Northwest Hardwoods Inc. US Littlejohn & Company LLC Completed

10. 400 IBO 100% Tensar Corporation US Castle Harlan Inc. Completed

11. 310 IBO 100% Quorum Business Solutions Inc. US Silver Lake Partners LP Pending

12. 250 IBO 100% Juniper Networks Inc.'s Junos Pulse mobile security business

US Siris Capital Group LLC Announced

13. 160 Minority stake Furie Operating Alaska LLC US Energy Capital Partners LLC Completed

14. 150 Minority stake CP Exploration II LLC US Post Oak Energy Capital LP Completed

15. 150 Minority stake 6% Box Inc. US TPG Capital LP; Coatue Management LLC Completed

16. 100 Minority stake Astrum Solar Inc. US Hudson Clean Energy Partners LP Announced

17. 79 Minority stake IRI Group Holdings Inc. US Completed

18. 75 Minority stake Avant Credit Corporation US Tiger Global Management LLC Completed

19. 70 Minority stake NextNav LLC US Goldman Sachs Group Inc.; Oak Management Corporation; New Enterprise Associates Inc.; Columbia Capital Corporation; Telcom Ventures LLC

Completed

20. 70 Minority stake AppDynamics Inc. US Battery Management Corporation; Kleiner Perkins Caufield & Byers; Lightspeed Venture Partners; Institutional Venture Partners; Sands Capital Management Inc.; Greylock Management Corporation; ClearBridge Investments LLC

Completed









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PE and VC investment activity weakens month-on-month

Despite an increase in overall M&A value in July, PE and VC investment activity declined over the four weeks to 440 transactions worth a combined USD 12,411 million, compared to 461 deals worth a collective USD 19,203 million in June.

However, in a 12-month comparison, value was almost two-thirds higher than the USD 7,188 million-worth of investment announced in July 2013.

Lower PE and VC investment value targeting US companies accounted for the decrease, sliding from USD 19,084 million to USD 12,220 million in July.

However, investment in Canada bucked this trend and the value of investment grew by 61 per cent month-on-month to USD 191 million after dropping sharply between May and June.

Compared to the same time a year ago the result was even more impressive, as just USD 27 million-worth of investment targeting Canadian companies was signed off in July 2013.

North America private equity deals by volume and value


Jul-14 440 12,411

Jun-14 461 19,203

May-14 447 17,518

Apr-14 470 16,073

Mar-14 410 27,062

Feb-14 380 17,854

Jan-14 359 15,163

Dec-13 383 14,707

Nov-13 368 13,619

Oct-13 398 14,196

Sep-13 363 12,879

Aug-13 382 46,358

Jul-13 433 7,188









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US private equity deals by volume and value


Jul-14 425 12,220

Jun-14 445 19,084

May-14 421 16,779

Apr-14 451 15,889

Mar-14 392 26,331

Feb-14 362 17,807

Jan-14 337 14,612

Dec-13 353 14,055

Nov-13 333 10,807

Oct-13 370 14,022

Sep-13 343 12,809

Aug-13 356 41,692

Jul-13 398 7,161

Canada private equity deals by volume and value


Jul-14 15 191

Jun-14 16 119

May-14 26 738

Apr-14 19 185

Mar-14 18 731

Feb-14 18 47

Jan-14 21 551

Dec-13 28 642

Nov-13 35 2,812

Oct-13 28 174

Sep-13 20 69

Aug-13 26 4,667

Jul-13 35 27









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North America private equity deals by volume and value

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M&A target sectors by volume

Target sector Jul-13 Jun-14 Jul-14

Other services 802 843 751

Machinery, equipment, furniture, recycling 131 152 122

Banks 81 66 66

Publishing, printing 24 39 62

Wholesale & retail trade 59 66 54

Chemicals, rubber, plastics 51 66 53

Education, health 34 39 39

Food, beverages, tobacco 18 21 30

Primary sector 17 38 27

Construction 12 24 19

Gas, water, electricity 15 22 16

Hotels & restaurants 12 13 14

Transport 19 19 13

Metals & metal products 21 29 12

Textiles, wearing apparel, leather 11 10 10

Insurance companies 6 13 6

Wood, cork, paper 8 5 3

Post and telecommunications 1 2 2

Public administration and defence 1 0 0

M&A target sectors by value

Target sector Jul-13 (mil USD)

Jun-14 (mil USD)

Jul-14 (mil USD)

Food, beverages, tobacco 130 1,481 49,861

Other services 35,782 63,800 45,397

Chemicals, rubber, plastics 4,910 5,015 22,142

Machinery, equipment, furniture, recycling 7,218 13,146 13,931

Wholesale & retail trade 20,850 3,095 10,127

Banks 24,206 8,169 8,680

Gas, water, electricity 1,824 14,214 4,596

Primary sector 1,644 17,612 3,011

Metals & metal products 198 1,318 2,468

Transport 3,207 1,498 2,196

Publishing, printing 500 790 1,688


Education, health 8,110 3,522 757


Hotels & restaurants 491 2,493 150

Insurance companies 841 5,939 60












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Private equity target sectors by volume

Target sector Jul-13 Jun-14 Jul-14

Other services 312 310 292

Machinery, equipment, furniture, recycling 41 48 42







Banks 6 2 3

Construction 1 8 3

Gas, water, electricity 3 6 3



Primary sector 1 6 2





Transport 2 2 0

Private equity target sectors by value

Target sector Jul-13 (mil USD)

Jun-14 (mil USD)

Jul-14 (mil USD)

Other services 4,201 16,390 4,501

Machinery, equipment, furniture, recycling 1,042 444 2,223

Gas, water, electricity 0 100 1,940

Primary sector 0 1,309 1,530




Banks 266 11 125











Transport 450 0 0









Page 12 © Zephyr

Top 20 private equity providers

Equity provider Number of deals Number with consideration Total deal value (mil USD) Average deal value (mil USD)

1 Energy Capital Partners LLC 2 2 2,100 1,050

2 Onex Corporation 1 1 1,325 1,325

3 CCMP Capital Advisors LLC 1 1 891 891

4 Global Infrastructure Management LLC 1 1 850 850

5 Ares Management LP 1 1 700 700

6 Kohlberg Kravis Roberts & Company LP 1 1 680 680

7 Leonard Green & Partners LP 1 1 500 500

8 GTCR Golder Rauner LLC 3 1 480 480

9 Littlejohn & Company LLC 1 1 465 465

10 Castle Harlan Inc. 1 1 400 400

11 Silver Lake Partners LP 2 2 334 167

12 Siris Capital Group LLC 1 1 250 250

13 TPG Capital LP 2 2 196 98

14 New Enterprise Associates Inc. 9 9 184 20

15 Post Oak Energy Capital LP 1 1 150 150

16 Coatue Management LLC 1 1 150 150

17 Accel Management Company LLC 4 4 147 37

18 Lightspeed Venture Partners 3 3 145 48

19 Kleiner Perkins Caufield & Byers 5 3 126 42

20 Oak Management Corporation 3 3 124 41









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Notes to editors

Activity is based on the activity of the target company

Deal status is announced within the time period

The sector breakdown uses targets’ activities as defined to be ‘Major Sectors’ by Zephyr

The date range is 01/07/2014 - 31/07/2014 inclusive





Zephyr Monthly M&A Report North America, July 2014

Economy & Finance

Transcript of Zephyr Monthly M&A Report North America, July 2014