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Term Sheet — Monday, June 20

Random Ramblings

Today’s planned column didn’t quite come together in time, so just some very quick notes to kick off your Monday:

• Brexit backdrop: Thomson Reuters released new data showing that UK target M&A only account for 4% of the global total ― $57.6 billion, year-to-date making it the lowest such percentage since records began being kept in 1980. Per usual, most activity involves cross-border buyers, with domestic-to-domestic UK M&A activity comprising just 17% of the total. Private equity-sponsored UK deals are down 69% year-to-date.

Globally, Thomson Reuters reports that M&A is down 20% from last year at $1.44 trillion (-16% for U.S. targets), with PE-backed deals off 35% (down 45% in the U.S.).

• IPO go no go? Twilio, a maker of cloud communication software, is scheduled to go public this week, hoping to be the year’s first IPO for a VC-backed tech unicorn. But I wouldn’t be stunned if the company got acquired instead, similar to what happened with Blue Coat Systems. No inside knowledge here, just saying that virtually all software IPO processes right now are dual processes.

• No hard feelings: Today’s big deal is that private equity firm Francisco Partners has teamed with activist investor Elliott Management to acquire Dell Software from Dell Inc. Kind of remarkable to see Dell working with activists (albeit on the sell-side), given that: (a) It went private, in part, due to its antipathy toward such investors; and (b) The rival to its Silver Lake-led take-private was an activist, in what became a very bitter battle.

• Recommended reading: Last year, Hewlett-Packard acquired Aruba Networks for around $2.7 billion. Aruba was originally being advised on the deal by boutique bank Qatalyst, but apparently the firm’s involvement didn’t sit too well with (pre-split) HP CEO Meg Whitman, dating back to both HP’s disastrous purchase of Autonomy (which Qatalyst advised) and the failed merger between Yahoo and eBay (then led by Whitman). The WSJ has gotten its hands on some unsealed Delaware court docs, detailing the dispute and how it ultimately led to Evercore’s involvement in HP/Aruba, and some serious press release massaging. Read it by going here.

• Fenway Father: Thanks to everyone who participated in #TermSheetDad last Friday. Here’s your winner.

• Waddya know? Just a reminder that you always can send me info anonymously by using our double super secret tip box:

• Congrats Cleveland!


Francisco Partners and Elliott Management have agreed to acquire the software business of Dell Inc., the Silver Lake portfolio company that is in the midst of buying EMC Corp. No financial terms were disclosed, although Reuters reported that the price-tag could be in excess of $2 billion. Read more.


• F2G Ltd., a UK-based antifungal drug discovery and development company, has raised $60 million in new VC funding. Sectoral Asset Management led the round, and was joined by Novo A/S, Aisling Capital, Brace Pharma Capital and return backers Advent Life Sciences, Novartis Venture Fund, Sunstone Capital and Merifin Capital.

• Plaid Technologies Inc., a San Francisco-based platform that “enables applications to connect with users’ bank accounts,” has raised $44 million in Series B funding. Goldman Sachs Investment Partners led the round, and was joined by return backer NEA.

• Condeco, a London-based provider of “workplace utilization” and meeting-room scheduling software, has raised EUR 27 million in Series A funding led by Highland Europe. Read more.

• StreamLink Software, a Cleveland-based provider of grant and board management SaaS, has raised $10 million in Series A funding. First Analysis led the round, and was joined by return backers North Coast Venture Fund, Blu Venture Investors, Hyde Park Venture Partners and Hyde Park Angels.

• Trooly, a Los Altos, Calif.-based service that verifies, screens and predicts trustworthy relationships and interactions, has raised $10 million in seed funding from Bain Capital Ventures and Milliways Ventures.

• CaterWings, a Berlin-based online marketplace for catering services, has raised EUR 6 million in new VC funding from by Holtzbrinck Ventures, Tengelmann Ventures and Rocket Internet.

• Unomaly, a Sweden-based provider of IT incident monitoring and detection solutions, has raised EUR 4.6 million in Series A funding led by EQT Partners.


• Alder Foods Inc., a Walpole, Mass.-based food supplier to military markets, has raised an undisclosed amount of equity funding from IMB Development Corp. Alder Foods reports $56 million in annual revenue.

• Clearlake Capital Group has completed its previously-announced acquisition of Vision Solutions, an Irvine, Calif.-based provider of disaster recovery and migration software, from Thoma Bravo. No financial terms were disclosed for the deal, which is expected to close later this quarter.

• First State Investments has agreed to acquire Coriance, a French district heating company, from KKR. No financial terms were disclosed.

• Gauge Capital has sponsored a recapitalization of Beauty Industry Group LLC, a Salt Lake City-based provider of installed hair extensions. No financial terms were disclosed.

• Lone Star Funds and JPMorgan Chase & Co. have submitted a joint bid to purchase Propertize BV, a Dutch ‘bad bank’ that holds around EUR 5.5 billion in loans and real estate assets, according to Bloomberg. This is viewed as the leading offer, although there is a rival bid from Cerberus Capital Management and Goldman Sachs. Read more.

• OpenGate Capital has agreed to acquire Alfatherm SpA, an Italy-based manufacturer of rigid, semi-rigid and flexible PVC films. No financial terms were disclosed.

• Quilvest Private Equity has sold its “cornerstone shareholding” in Acrotec Group, a Swiss maker of watch components, to Castik Capital and company management at an enterprise value of around EUR 255 million.

• TPG Capital has agreed to acquire a 40% stake in the rural banking unit of Filipino lender BDO Unibank Inc. No financial terms were disclosed. Read more.

• Vision Ridge Partners has acquired EVGo, a Boulder, Colo.-based public charging network for electric vehicles, from NRG Energy (NYSE: NRG). No financial terms were disclosed.


• Four companies are expected to price IPOs on U.S. exchanges this week: Twilio, Gemphire Therapeutics, Selecta Biosciences and Tactile Systems Technology. Read more.

• Syros Pharmaceuticals, a Cambridge, Mass.-based developer of gene control therapies for cancer and other diseases, has set its IPO terms to 4 million shares being offered at between $14 and $16 per share. It would have an initial market cap of around $341 million, were it to price in the middle of its range. The pre-revenue company plans to trade on the Nasdaq under ticker symbol SYRS, with Cowen & Co. and Piper Jaffray serving as co-lead underwriters. Shareholders include Flagship Ventures (23.8% pre-IPO stake), Arch Venture Partners (22.9%), Fidelity (11.4%), Deerfield Management (9.1%), Polaris Partners (6.4%) WuXi Healthcare Ventures (5.8%), Redmile Group, Aisling Capital and Alexandria Venture Investments.

• TPI Composites Inc., a Scottsdale, Ariz.-based manufacturer of composite wind blades, has filed for a $150 million IPO. It plans to trade on the Nasdaq under ticker symbol TPIC, with J.P. Morgan and Morgan Stanley serving as co-lead underwriters. The company reports $1.7 million of net income on $176 million in revenue for Q1 2016, compared to a $5.7 million net loss on around $96.6 million in revenue for the year-earlier period. Shareholders include Element Partners (32.2% pre-IPO stake), Landmark Partners (20.9%), Angeleno Group (18.5%), NGP Energy Technology Partners (14.8%) and GE Ventures (11%).


• Deutsche Telekom is considering a takeover bid for Host Europe Group Ltd., a Germany-based Internet domain registrar and website hosting company owned by Cinven, according to Bloomberg. Other suitors could include The Blackstone Group and Hellman & Friedman, with the deal possibly worth upwards of EUR 1.7 billion. Read more.

• TPG Growth has hired Jefferies & Co. to find a buyer for NorthStar Anesthesia PA, an Irving, Texas-based anesthesia-care company, according to Dow Jones. Read more.

• Twitter (NYSE: TWTR) has acquired Magic Pony Technology, a London-based developer of machine learning techniques for visual processing. No financial terms were disclosed. Sellers include Octopus


• Adeptio has agreed to acquire a control stake in Kuwait Food Co. (Americana), a listed Kuwaiti operator of such brands as FFC and Pizza Hut, for around $2.5 billion from the al-Kharafi family. The deal was originally announced in February, but later was called off after the two sides could not agree on final terms. Read more.

• National Bank of Abu Dhabi and First Gulf Bank confirmed that they are in merger talks. Read more.


• Empirio Capital has been launched as a Poland-based private equity firm, by former Advent International investors Christian Senye and Pawel Ryszkiewics. Read more.

• Kellogg Co. (NYSE: K) has launched a corporate VC group called 1894 Capital, to make minority investments in startups “pioneering new ingredients, foods, packaging, and enabling technology.”


• Paul Canning is stepping down as head of the London office of H.I.G. Capital, according to the WSJ. He has been with the Florida-based private equity firm for nearly a decade. No word yet on his future plans. Existing H.I.G. staffer Carl Harring will manage London going forward. Read more.

• The Carlyle Group has promoted David Bluff to managing director and head of Australia and New Zealand private equity. He succeeds Simon Moore, who last fall announced plans to step down.

• Jacqueline Kosecoff, a managing partner of private equity firm Moriah Partners, has joined Houlihan Lokey as an independent director.

• Pillarstone, a European credit platform affiliate of KKR, has made three hires: Jonathan Conway, former head of EMEA restructuring at Barclays; Pablo Crespo, former director with AnaCap, and Michele Sabatini, formerly with Bregal Capital. Conway and Crespo will be partners with Pillarstone, while Sabatini will be a director.

• Mark Rawlinson has agreed to join Morgan Stanley as chairman of UK investment banking. He previously was a corporate partner with law firm Freshfields Bruckhaus Deringer. Read more.

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