Deal round-up - January 22 - February 9, 2018

Data Analyst Katrin Kostadinova highlights the most significant financial and corporate legal deals announced or closed in the last week

It has been a strong start to 2018, especially in the M&A and capital markets spaces.

Americas

Starting with the United States – in the M&A space, Keurig Green Mountain has taken over Dr Pepper Snapple Group in an $18.7 billion deal. The transaction is part of the company’s effort to build a food and beverages empire, including Krispy Kreme Doughnuts and Caribou Coffee.

In a cross-border deal between France and the United States - Sanofi took over Bioverativ for $11.6 billion. This is the largest deal of the French healthcare company in the last seven years. Target is to strengthen the firm’s positions in rare diseases treatment.

Celgene has acquired Juno Therapeutics for $9 billion. The deal will enhance the cancer pipeline. The company aims to reduce on Revlimid – its own cancer treatment.

FUJIFILM Holdings has made a bid for Xerox in a $6.1 billion deal. The merger will combine the longstanding joint venture between the companies. Fujifilm will acquire 50.1% of Xerox.

AIG has acquired Validus for $5.56 billion – the deal is part of the acquirer’s strategy to grow and diversify its portfolio. The new business will enhance AIG’s insurance sector.

WestRock has acquired KapStone for $4.9 billion. The target company is a leading producer and distributor of containerboard, corrugated products and specialty papers in North America.

Elliott Management has invested $2.5 billion in FirstEnergy. The investment consisted of $1.62 billion in convertible preferred equity and $850 million in common equity.

SAP has acquired Callidus Software for $2.4 billion in a cross-border deal between Germany and the United States. The company is trying to gain more exposure in the marketing sector and compete with Salesforce and Oracle.

The Kroger convenience store business has been acquired by the British private EG Group for $2.15 billion. Proceeds from the sale will be used by Kroger to repurchase shares and minimise its debt.

Global Infrastructure Partners has agreed to acquire NRG Energy's renewable energy business for $1.375 billion. The deal includes acquiring the controlling stake and 46% economic interest in NRG Yield.

Targa Resources and Stonepeak Infrastructure Partners have entered into a $1.1 billion joint venture. The deal will significantly reduce Targa’s equity financing requirements.

Moving to the capital markets, ADT has undertaken an IPO on the NYSE. The company – a security monitoring services provider, has offered 105 million shares. Apollo Global Management is backing up the offering.

Morgan Stanley has undertaken a bond issue. The company has issued $7.5 billion in senior notes - $2 billion floating-rate notes due 2021, $2.5 billion fixed-rate notes due 2023 and $3 billion fixed-to-floating-rate notes due 2029.

Crown Castle has issued $1.75 billion in senior notes. The issue consisted of $750 million 3.15% notes due 2023 and $1 billion 3.8% notes due 2028. Proceeds will be used to repay a previous bond issue.

FedEx has also undertaken a bond issue – the company has issued $1.5 billion in senior notes. Bonds consisted of $500 million 3.4% notes due 2028 and $1 billion 4% notes due 2048.

Hologic has undertaken a $1 billion bond issue, consisting of $600 million 4.375% notes due 2025 and $400 million 4.625% notes due 2028. Proceeds will be used to redeem outstanding senior notes.

IBM Credit has issued $2 billion in senior notes. Notes bare a coupon rate of 2.65% ($800 million due 2021), 3% ($750 million die 2023) and floating rate ($450 million due 2021) notes.

Moving to Canada, A consortium between Blackstone, CPPIB and GIC has acquired a 55% stake in the Thomson Reuters financial and risk unit for $20 billion. The business provides data, analytics and trading info to the financial sector. The company will also sign a 30-year agreement with Reuters News for its content.

Aurora Cannabis took over CanniMed Therapeutics in a C$1.1 billion deal. Companies are looking forward to the future benefits of the legalisation of recreational marijuana later in 2018.

Motorola Solutions has acquired Avigilon for C$1.2 billion in Canada. The deal follows Motorola’s aim to expand its portfolio with new products.

In the Canadian capital markets space, Export Development Canada has issued $1.25 billion in 2.5% senior notes. Issue is due 2023. The issuer is a financing provider, that also works in the insurance and bonding solutions sectors in Canada.

The Province of Ontario has undertaken a C$1 billion 2.65% green bond offering.

Meanwhile, the Toronto-Dominion Bank has issued $1.5 billion in bonds. The issue consisted of $1 billion 2.55% notes due 2021, $500 million floating rate notes due 2021. The issue is part of the bank’s $40 billion MTN program.

Elsewhere in the Americas, Mexican drinks manufacturer Patrón Spirits International has been acquired by Bacardi for $5.1 billion. Tequila sales are growing faster than the other alcoholic beverages.

Finally, in Brazil the national oil and gas company Petrobras has issued $2 billion in 5.75% notes, which are due 2029.

Asia-Pacific

In India Bandhan Bank has undertaken an IPO on the BSE and NSE. Kotak Mahindra Capital, Axis Capital, Goldman Sachs (India) Securities, JM Financial Institutional Securities and JP Morgan India have acted as bookrunning lead managers on the deal.

The China Road and Bridge Corporation is working on a $1.8 billion PPP development of a 190 km expressway in Cambodia. The expressway will link the capital with the nation’s only deep-sea port.

In Singapore Tata Steel has issued $1.3 billion in senior notes. The issue included $300 million 4.45% notes due July 24, 2023 and 5.45% notes due January 24, 2028. 

Europe, Middle East and Africa (EMEA)

Moving to Europe, there have been a number of notable cross border M&A deals recently. Perhaps the most significant matter has seen Melrose Industries make a £7.4 billion hostile takeover bid for GKN in the United Kingdom. The is the largest unilateral bid since 2009 in the UK. It is also the subject of fierce political debate, with one US congressman declaring the deal a potential security risk for the US. The deal will be financed through a new debt facility, which will also refinance existing debts of both companies.

French company Sanofi has taken over Ablynx in a €3.9 billion deal. The deal is the latest in a string of M&A deals in the biotech sector. Sanofi, which is already a partner of Ablynx, will now gain access to the firm’s most promising asset, the experimental drug caplacizumab.

Elsewhere, Swiss-based luxury goods company Richemont has made a €2.8 billion bid for Yoox Net-a-Porter in Italy. If completed, the deal will increase the bidder’s online presence in the luxury goods sector.

Blackstone and Blue Water Energy have invested $1 billion in Mime Petroleum. The borrower is a production and development company on the Norwegian Continental Shelf.

In the capital markets, The European Investment Bank has issued $5 billion senior notes in Luxembourg. The issuer is the European Union bank and is supporting growth and development projects.

The Kingdom of Spain has undertaken a €10 billion 1.4% sovereign bond issue. The coupon rate will be 1.4% and notes are due April 30, 2028.

The Erste Group Bank has undertaken a €1 billion pfandbrief issue in Germany and Austria. The interest rate will be 0.75% and due date will be in January 2028.

Finally, in the Middle East, the Al Jaber Group has undertaken a $1.6 billion debt restructuring procedures in the United Arab Emirates. Debt maturity will be delayed with seven years.