Latest Reports

January 31, 2023 | Technology | North America | Ended

Activision Blizzard / Microsoft : In-Depth Report

In January 2022, Microsoft announced that it would acquire Activision Blizzard, a game developer behind some of the world’s best-selling franchises, including Call of Duty, World of Warcraft, and Candy Crash, for $68.7bn. It is Microsoft’s largest acquisition to date, the biggest ever in the video game sector, and the price reflects the value of content in the industry. The merger comes with significant antitrust risks, however, and it is under in-depth investigations globally, including in the UK, Europe and the US, where the FTC has sued to block it. Investors are navigating uncertainty around the regulatory considerations and processes, and in this report, we weigh the key deal risks and ask whether the risk-reward of owning Activision is worth it. Microsoft has tried to frame the deal as unproblematic and a small piece of a much larger gaming market, but antitrust enforcers have honed in on Microsoft’s ability and incentive to foreclose competitors by restricting or degrading access to Activision’s content on ...


January 26, 2023 | Industrials | North America | Ended

Evoqua Water Technologies / Xylem : Deal Insight

Water technology company Xylem announced on 23-Jan-23 that it has agreed to acquire its peer Evoqua in an all-share $7.5bn merger. Evoqua shareholders will receive 0.48 shares of Xylem for each Evoqua share, initially representing $52.69 per Evoqua share per the M&A announcement (now $49.22). At announcement, the offer implied a 29% premium to the target’s undisturbed price on 20-Jan-23. The deal is subject to approval by shareholders of both companies (50%), and in addition to an HSR condition, potentially any “filings and notices required by the FCC.” We suspect that an FCC notification is due to Xylem’s FlexNet communication network, which offers two-way communication technology for metering services and leverages on FCC-licensed spectrum. The companies have not specified foreign antitrust conditions, but we note that more than half of the acquirer’s sales are from ...


January 13, 2023 | Technology | North America | Ended

Duck Creek Technologies / Vista Equity Partners : Deal Insight

Duck Creek Technologies, an insurance software vendor that IPO’d in August 2020, announced on 9-Jan-23 that it has agreed to be taken private by Vista Equity Partners in a deal valued at $2.6bn. Vista, a private equity firm which focuses on enterprise software and data ventures, is offering $19.00 per share, implying a 46% one-day premium. Conditions to closing include 50% approval by target shareholders and HSR approval; an HSR notification was expected by 11-Jan-23, which suggests the waiting period will expire on 10-Feb-23. The merger agreement contains customary clauses, with MAC carve-outs for pandemics and war. The termination fee is ...


January 13, 2023 | Technology | North America | Ended

Maxar Technologies / Advent International : Deal Insights

Satellite owner and operator Maxar Technologies has agreed to be taken private by Advent International for $4.0bn, or $6.4bn including debt. Under the terms of the agreement, announced on 16-Dec-22, Advent is offering $53 per share, a 129% premium to the previous day’s undisturbed price. A 60-day ‘go-shop’ is set to expire on 14-Feb-23. Maxar’s board supports the deal, and conditions include an approval from shareholders (50%) and regulatory clearances in the US, including under HSR and from CFIUS as well as from the Defense Counterintelligence and Security Agency (DCSA) and the US Department of State’s Directorate of Defense Trade Controls (DDTC). The deal is neither subject to financing nor conditional on any operational updates relating to the launch, deployment, or performance of Maxar’s WorldView Legion satellite programme. The termination fee is $51.9m until the end of the ‘go-shop’ period and will increase to ...


January 09, 2023 | Materials | Australia | Ended

OZ Minerals / BHP Group : Deal Insight

Looking to boost its exposure to critical metals used in clean energy and electric cars, BHP Group (“BHP”) is acquiring copper and nickel producer OZ Minerals. The companies signed a Scheme Implementation Deed (the “Deed”) on 22-Dec-22, which came after BHP completed four weeks of exclusive due diligence (extended by a week on 20-Dec-22). BHP initially made a non-binding, indicative offer for AUD 25 per share on 7-Aug-22, which was rejected by the target’s board for undervaluing the company. On 18-Dec-22, BHP sweetened the price to AUD 28.25 per share, representing a 49.3% premium to OZ Minerals’ closing price on 5-Aug-22, the last trading day prior to BHP’s first proposal. Due diligence was then granted on 21-Nov-22 and the deal is now definitive. The implementation date is expected to be mid to late April 2023 against a long-stop date of 31-Aug-23, and we will assume ...


December 15, 2022 | Technology | North America | Ended

Coupa Software / Thoma Bravo : Deal Insight

Thoma Bravo announced on 12-Dec-22 that it will take private cloud-based technology firm Coupa Software through an $8bn buyout. The financial sponsor, which recently made a number of sizeable public-to-private deals for technology companies, including Anaplan, SailPoint, and Ping Identity, beat out Vista Equity Partners, which was also in takeover talks to buy the company. The deal, which the companies expect will complete in 1H’23, also includes a “significant minority investment” from the Abu Dhabi Investment Authority (ADIA). Under the terms of the agreement, Coupa stockholders will receive $81 per share in cash, representing a 30.5% one-day premium and a 77.2% premium when compared with Coupa’s closing share price on 22-Nov-22, the last trading day before media reports emerged regarding a possible sale of the company. Conditions include majority approval from Coupa shareholders and regulatory clearances, including under HSR, and notifications will also be made with CFIUS and the Defense Counterintelligence and Security Agency (DCSA)...


December 14, 2022 | Health Care | Europe | Ended

Horizon Therapeutics / Amgen : Deal Insight

Biotechnology company Amgen agreed to buy US-operated, Ireland-incorporated drugmaker Horizon Therapeutics (“Horizon”) for $27.8bn or $116.50 per share in cash, the companies announced on 12-Dec-22. The price represents a one-day 19.7% premium and a 47.9% premium to Horizon’s undisturbed share price on 29-Nov-22, when the target confirmed that it was in preliminary talks with multiples suitors over a possible takeover. The deal will be implemented through a scheme of arrangement, sanctioned by the High Court of Ireland, which requires approval from at least 75% of Horizon shareholders present at a scheme meeting. Antitrust approvals will be sought from relevant authorities in the US, Austria, and Germany, along with foreign investment clearances in France, Germany, Denmark, and Italy. The MAC within the merger agreement has specific carve-outs relating to COVID-19 and war while the burdensome condition clause stipulates that the companies may pursue “remedy actions” but with neither required to agree to remedial action with respect to Horizon assets that are “reasonably be expected to be material.” The reverse termination fee is $974m (3.5% of equity value) and Horizon is liable to a capped reimbursement payment of $278m. Amgen has secured $28.5bn to fund the acquisition from a consortium of banks led by Citi and Bank of America ...


December 13, 2022 | Health Care | Europe | Ended

Chr. Hansen / Novozymes : Deal Insight

Danish biotechnology companies Chr. Hansen and Novozymes announced on 12-Dec-22 an agreement to merge, with the aim of creating a global leader in biosolutions. Structured as a statutory merger under the Danish Companies Act, the all-share deal will see Chr. Hansen shareholders receive 1.5326 new Novozymes B-shares for each Chr. Hansen share, implying a one-day takeover premium of 49% and initially valuing each Chr. Hansen share at DKK 660.55. The merger is conditional on approvals at respective EGMs of both companies (expected in 1H’23; two-thirds of votes and capital cast), as well as regulatory approvals from relevant authorities in the EU, China, Brazil, South Korea, Turkey and the US, and foreign investment approvals from France and Italy. Importantly, Novo Holdings (private, “Novo”), a $94bn medical treatment and research-focused charitable foundation, and the largest shareholder of both companies (25.5% of Novozymes capital, 72.7% of Novozymes votes; 22% of Chr. Hansen shares and votes), will support the merger on the belief that the companies are “a perfect match”. Novo will exchange its 22% stake in Chr. Hansen at a lower exchange ratio, 1.0227 new Novozymes B-shares, and upon completion, Novo will own ...


November 22, 2022 | Health Care | North America | Ended

Abiomed / Johnson & Johnson : Deal Insight

On 1-Nov-22, pharma and medical devices giant Johnson & Johnson (“J&J”) announced a definitive agreement to acquire heart pump maker, Abiomed, for an enterprise value of $16.6bn, or $380 cash per share. The offer implies a 50.7% one-day premium and is just shy of Abiomed’s 52-week high, near the level shares traded four years ago. This deal will be J&J’s largest takeover since its $30bn acquisition of Actelion in 2017 and its largest device deal since its $20bn acquisition of Synthes in 2012. An interesting aspect of the offer consideration is an additional non-tradable contingent value right (CVR) that will be given to Abiomed shareholders, worth up to $35 per share. Payments of the CVR are split into three tranches based on specific milestones: (i) $17.50 if Abiomed’s product sales exceed $3.7bn during 2Q’27-1Q’28 (if achieved at a later date during any rolling four quarters through J&J’s 1Q’29, the CVR will be reduced to $8.75), (ii) $7.50 if Abiomed’s Impella receives FDA approval for use in ST-Segment Elevation Myocardial Infarction (STEMI) patients without cardiogenic shock, by ...


November 22, 2022 | Energy | Australia | Ended

Origin Energy / Brookfield : Deal Insight

Origin Energy, one of Australia's largest power and gas suppliers, has received an indicative, conditional, and non-binding proposal from a consortium led by Canadian asset firm Brookfield. The target’s board confirmed on 10-Nov-22 that it would grant due diligence to the consortium, which also includes energy infrastructure investment firm EIG Partners, through its LNG company MidOcean Energy, and that it intends to recommend shareholders approve the AUD 9 per share proposal. Origin communicated that the proposal follows an earlier indicative bid from the consortium at AUD 7.95 per share on 8-Aug-22 (AUD 7.79 ex-dividend) and a subsequent proposal at AUD 8.70 to AUD 8.90 per share, before Origin agreed to grant due diligence at AUD 9. The latest bid on the table values the target at an AUD 18.4bn enterprise value and implies a 54.9% takeover premium to Origin’s unaffected closing share price on 9-Nov-22. The offer is cum dividend and includes a ticking fee, whereby if the scheme is not effective by ...



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