Good morning, Term Sheet readers.
Professional services firm EY released its 2018 M&A mid-year outlook this week, and it had some interesting takeaways. Here are several key points that dealmakers should know:
• Cross-border deal activity isn’t slowing down: Growing trade disputes between the United States and countries around the world have re-ignited concerns and unnerved investors in recent weeks. This element of uncertainty may prompt dealmakers to consider how M&A can help shore up critical supply chains in key markets. EY reports: “Short-term worries over protectionist gestures do not account for the centuries-long process of increasing global economic interdependence, which continues to expand and create new opportunities for deploying capital abroad.”
• Mega-deals are here to stay: The optimism of executives is translating to opportunistic action in the form of mega-deals. Expect to see more massive cross-border deals as dealmakers get more comfortable doing business abroad.
• Companies rethink their competitive formula: Divestments are gaining popularity as more executives begin to see the as a strategic imperative. More companies are implementing more frequent and rigorous portfolio reviews, which identify underperforming or non-core assets and divesting businesses that no longer fit with the strategy.
• Corporate confidence remains strong: More than half (54%) of U.S. executives say they expect to actively pursue M&A in the next 12 months, and 61% expect their M&A pipelines to increase.
PEOPLE MOVES: Kevin Hartz is leaving his role as a partner at San Francisco-based venture capital firm Founders Fund. “After nearly two years with Founders Fund, Kevin is ready for a new challenge. He remains a friend of the firm and we’re excited to see what he does next,” said a Founders Fund spokesperson.
Hartz joined Founders Fund in September 2016 and transitioned into an entrepreneur-in-residence and venture partner role in February. Term Sheet has learned that Hartz will leave to pursue other ventures, likely as an operator. Read more at Fortune.
THE LATEST FROM FORTUNE...
• Jack Ma’s Chinese Fintech Firm Just Raised so Much Money It’s Now Worth More Than Goldman Sachs (by David Meyer)
• Female-Founded Startups Generate More Revenue and Do It With Less Funding (by Beth Kowitt)
• Everyone Thought The Gig Economy Was Taking Over. Turns Out It’s Not (by Natasha Bach)
• Warren Buffett and Jamie Dimon on Bitcoin: ‘Just Beware’ (by Sarah Gray)
• Starship Technologies, a London-based company building network of robots, raised $25 million in funding. Investors include Matrix Partners and Morpheus Ventures.
• Devo, a Burlington, Massachusetts and Madrid-based data operations company, raised $25 million in Series C funding. Insight Venture Partners led the round, and was joined by investors including Kibo Ventures.
• Bedrock Analytics, an Oakland, Calif.-based intelligent analytics and insights automation platform for the consumer packaged goods industry, raised $7.2 million in funding. Cervin Ventures and Illuminate Ventures co-led the round.
• EON Foundation, a Palo Alto, Calif. and Singapore-based blockchain games company, has raised $5 million in seed funding. Investors include Cherubic Ventures.
• WhyHotel, a Baltimore-based operator of pop-up hotels in luxury apartment buildings, raised $3.9 million in seed funding. Camber Creek led the round, and was joined by investors including Revolution’s Rise of the Rest Seed Fund, Mendacre, MetaProp and Working Lab Capital.
• Panda, a San Francisco-based voice-activated camera with filters, raised $850,000. Investors include Social Capital, Afore Capital, and Cyan Banister.
HEALTH AND LIFE SCIENCES DEALS
• SutroVax, a Foster City, California-based biopharmaceutical company, raised $85 million in Series C funding. TPG Growth led the round, and was joined by investors including Medicxi, Foresite Capital, Abingworth, Longitude Capital, Frazier Health Care Partners, Pivotal bioVenture Partners, Roche Venture Fund and CTI Life Sciences Fund.
• Oncologie, a Boston and Shanghai-based biopharmaceutical company, raised $16.5 million in seed funding. Pivotal bioVenture Partners China led the round.
PRIVATE EQUITY DEALS
• Kensington recapitalized Kenona Industries, a Grand Rapids, Mich.-based precision machining business serving the automotive industry. The transaction was for $85 million.
• ACON Investments and Humus Capital Partners acquired a majority stake in Biosidus, an Argentina-based maker of biosimilar pharmaceuticals. Financial terms weren’t disclosed.
• Showpad, which is backed by Insight Venture Partners, acquired LearnCore, a Chicago-based provider of sales training and coaching software. Financial terms weren’t disclosed.
• L Squared Capital Partners made an investment of an undisclosed amount in Kanopy, a San Francisco-based streaming video platform for public libraries and universities.
• Arable Capital Partners acquired Farmington Fresh Cuts, a Stockton, Calif.-based processor of fresh sliced apples, oranges, pears and other packaged fruits. Financial terms weren’t disclosed.
• Polaris Partners invested in NetRate Systems, an Okemos, Mich.-based SaaS rating engine and workflow platform for commercial insurance. Financial terms weren’t disclosed.
• Herman Miller, Inc. (NASDAQ: MLHR) acquired a 33% equity interest in Nine United Denmark A/S, a manufacturer of furniture for workplaces and private homes, for $66 million.
• Far Point Acquisition Corp, a New York-based blank check company formed to acquire a company or companies in the fintech space, increased its IPO raise estimate to $500 million from $400 million. Third Point backs the firm. Credit Suisse and BofA are underwriters in the deal. The company plans to list on the NYSE as “FPAC.U.” Read more.
• MeiraGTx, a New York City-based gene therapy firm, raised $75 million in an IPO of 5 million shares priced at $15, in the middle of its $14 to $16 range. The firm has yet to post a revenue. Kadmon Corp. (17.7%), Perceptive Advisors (16.1%), and Alexandria Equities (8.2%) back the firm. BofA, Barclays, and Evercore ISI are joint bookrunners in the deal. The firm plans to list on the Nasdaq as “MGTX.” Read more.
• Cornerstone Management, a Guangdong, China-based private equity firm, filed for a $70 million IPO. It posted revenue of $6.4 million in the year ending March 31. ViewTrade Securities is underwriter. It plans to list on the Nasdaq as “CSCA.” Read more.
• M17, a Taipei-based live-streaming firm, raised $60 million in an IPO of 7.51 million ADSs priced at $8 apiece, below its $10 to $12 range. The firm posted revenue of $90.1 million in 2017. Vertex Asia Fund (12.1%), Infinity Ventures (9.1%), and KTB Asia Fund (5.7%) back the firm. Citigroup and Deutsche Bank Securities are underwriters in the deal. The firm plans to list on the NYSE as “YQ.” Read more.
• Mason Wells sold Pacon, an Appleton, Wisc.-based provider of branded arts & crafts and specialty paper products for the school, retail and online channels. The buyer was Fabbrica Italiana Lapis ed Affini S.p.A. The value of the transaction was $340 million.
• Trilantic North America acquired a majority interest in Sunbelt Transformer, a Temple, Texas-based provider of power solutions, equipment, and services to commercial, industrial and utility end markets, from Grey Mountain Partners. Financial terms weren’t disclosed.
• Rakuten will acquire Silicon Valley mobile ordering and pickup startup Curbside, a Palo Alto, Calif.-based mobile ordering and pickup startup. Financial terms weren’t disclosed. Curbside had raised approximately $35 million in venture funding from investors including CVS, Index Ventures, Sutter Hull Ventures, AME Cloud Ventures, Qualcomm Ventures, and Chicago Ventures.
FIRMS + FUNDS
• Logan Allin, Social Finance Inc.’s former head of ventures and corporate development, is raising a $150 million fund to invest in early stage financial technology firms in the U.S. and abroad, according to Bloomberg. Read more.