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Arby’s Parent to Acquire Jimmy John’s
Sept. 25, 2019 | WSJ | By Heather Haddon.

BUSINESS
Arby’s Parent to Acquire Jimmy John’s
Inspire Brands adds to a stable of restaurants that also includes Sonic, Buffalo Wild Wings

Jimmy John’s had $2.15 billion in U.S. sales last year across 2,803 stores. PHOTO: JOHN LOCHER/ASSOCIATED PRESS
By Heather Haddon
Sept. 25, 2019 6:55 am ET
Inspire Brands Inc. is acquiring Jimmy John’s Gourmet Sandwiches, the private-equity-backed firm’s latest addition to its stable of restaurant chains.

While competitors focus on either fast-food or casual restaurant formats, Inspire is betting that it can draw in more diners and generate higher sales by owning restaurants that span that spectrum. The company acquired the Sonic burger chain last year after merging Arby’s and Buffalo Wild Wings earlier in the year.

The acquisition of Jimmy John’s will make Inspire the fourth-largest U.S. restaurant company, with more than $14 billion in sales across 11,200 restaurants, according to Inspire. Both companies engaged in an equity-swap transaction for the deal, the exact financial terms of which weren’t disclosed. The transaction is expected to close next month.

Inspire Chief Executive Paul Brown has said he wants to acquire around 10 chains, each with about $4.5 billion in annual sales.

“I’m more confident in our approach to the business today than I was even when I started out on this path,” Mr. Brown said in an interview. He added that he is looking for chains with strong growth potential rather than specific cuisines to add to Inspire’s menu.

Jimmy John’s, based in Champaign, Ill., had $2.15 billion in U.S. sales last year across 2,803 stores, a roughly 50% increase in both sales and locations since 2013, according to market-research firm Technomic Inc.

Roark Capital Group, a private-equity firm that first took a majority stake in Jimmy John’s in 2016, is also the financial backer that created Inspire through the Arby’s and Buffalo Wild Wings merger last year. Jimmy John’s was valued at around $2.3 billion when Roark acquired a stake that included a minority share in the sandwich maker owned by private-equity firm Weston Presidio.

Jimmy John’s is facing competition from newer sandwich chains including Jersey Mike’s Subs, Firehouse Subs and Cousins Submarines Inc. Subway remains the dominant player in the market and has expanded delivery through outside companies. Jimmy John’s has stuck to its own fleet of delivery couriers. Mr. Brown said it was too early to say whether Inspire would open Jimmy John’s to third-party delivery companies.

Jimmy John Liautaud, who opened the chain while he was in college at Eastern Illinois University in 1983, will step down as board chairman and become an adviser to the brand, Inspire and Mr. Liautaud said. Jimmy John’s president, James North, will remain and report to Inspire.

In a letter sent Wednesday to suppliers and vendors, Mr. Liautaud said Inspire’s buying power and technology would make the company more efficient and profitable.

“I created, raised, and nurtured this company to the best of my ability and now it’s time for this brand to soar,” he wrote.

Outside of its holdings in Inspire, Atlanta-based Roark has a large food and restaurant portfolio, with investments in ice-cream maker Carvel, Auntie Anne’s pretzels and burger chain Carl’s Jr. Roark led Wingstop Inc. to a public offering in 2015 after owning a majority of the chain for five years.

Wingstop’s shares were up 36% this year as of Tuesday’s close, roughly in line with share gains this year for some other multibrand restaurant companies, including Yum Brands Inc. and Restaurants Brands International Inc.

Write to Heather Haddon at heather.haddon@wsj.com
brands  fast-food  M&A  mergers_&_acquisitions  restaurants 
6 weeks ago by jerryking
Looking Ahead After a Quarter Century Into the Digital Age - CIO Journal
Aug 16, 2019 | WSJ | By Irving Wladawsky-Berger.

* Large economic potential is linked to digitization—and much of it is yet to be captured
* Digital superstars are rising far beyond the U.S. big four and China’s big three
* Digital natives are calling the shots
* Digital changes everything—even industry boundaries
* Agile is the new way to compete
* Playing the platform economy can boost earnings
* Self-cannibalization and innovation are a necessity for digital reinvention
* Going after the right M&A is key
* Effective management of digital transformation is vital—but challenging
* Leveraging and transitioning from digital to new frontier technologies is an imperative


Effective management of digital transformation is vital—but challenging. High incidences of failure can be found across industries and countries regardless of the objectives of the digital transformation, including customer experience, the most common type of transformation.

The report recommends five key actions to improve the odds of a successful digital transformation: shared responsibility and accountability; clarity of objectives and commitment; sufficient resources; investments in digital talent; and flexibility and agility.
artificial_intelligence  digital_economy  digital_natives  digitalization  industry_boundaries  insights  Irving_Wladawsky-Berger  McKinsey  M&A  millennials  platforms  self-cannibalization 
12 weeks ago by jerryking
London Stock Exchange lays $27bn bet that data are the future
July 28, 2019 | | Financial Times | by Arash Massoudi, Richard Henderson and Richard Blackden.

The London Stock Exchange Group more than 300 years old, is trying to get back on the front foot with a plan for its most ambitious acquisition, one that will shape the direction of the group for years to come. It is the most striking demonstration yet of the charge among exchange operators into the business of supplying the data that is at the heart of markets....The LSE on Friday confirmed a Financial Times report that it was in talks to buy data and trading venue group Refinitiv for $27bn including debt, from a consortium led by private equity group Blackstone. If an agreement is reached for a company best-known for its Eikon desktop terminals, it would transform the LSE into a provider of financial market infrastructure and data with the scale to take on US exchange industry heavyweights Intercontinental Exchange and CME Group as well as Michael Bloomberg’s financial information empire.

“This would be a bold move in the shift among exchanges away from the matching of buyers and sellers and into the business of selling information,” said Kevin McPartland, head of market structure research at consultancy Greenwich Associates. “Data are so valuable and so is having the network of traders and investors to access that data — that’s all at play here.”......The deal would also be a defining moment for the LSE’s chief executive, David Schwimmer, just a year after the relatively unknown former Goldman Sachs banker was parachuted in to steady the ship. Its scale will bring considerable risk in execution alongside the need to convince LSE shareholders that taking on Refinitiv’s $12bn of debt will prove worth it.

Industry analysts see the strategic logic of the deal for the LSE, best known for its UK stock exchange and derivatives clearing house LCH. While revenue from initial public offerings can be more volatile, spending by everyone from asset managers to hedge funds on financial data and the analytical tools to make use of it has been going in one direction. It hit a record $30.5bn last year
.......“What’s happened is exchanges have found it more difficult to find ways of generating revenue in their traditional businesses,” “You can deliver data so easily now, there is voracious appetite from anyone making investment decisions so they can get an edge.”.....As well as winning over LSE shareholders, any deal is likely to face a lengthy period of antitrust approvals.

“There is a wider market concern about exchanges and data vendors combining,” said Niki Beattie, founder of Market Structure Partners. “The global world of data distribution is presided over by a small number of players who have a lot of power.”
asset_management  Blackstone  Bloomberg  bourses  data  financial_data  hedge_funds  inflection_points  IntercontinentalExchange  investors  LSE  mergers_&_acquisitions  M&A  Refinitiv  stockmarkets  Thomson_Reuters  tools  trading_platforms  turning_points  defining_moments 
july 2019 by jerryking
The spreadsheet maker who created Scotland’s flying unicorn
Mure Dickie in Edinburgh and Madhumita Murgia in London NOVEMBER 25, 2016.

Entrepreneur's belief pays off with GBP1.4 bn China buyout
travel  Scotland  small_business  mergers_&_acquisitions  M&A  software_developers  buyouts 
may 2018 by jerryking
Disney Makes $52.4 Billion Deal for 21st Century Fox in Big Bet on Streaming
DEC. 14, 2017 | The New York Times | By BROOKS BARNES.

The Walt Disney Company said on Thursday that it had reached a deal to buy most of the assets of 21st Century Fox, the conglomerate controlled by Rupert Murdoch, in an all-stock transaction valued at roughly $52.4 billion.

While the agreement is subject to the approval of antitrust regulators — and the Justice Department recently moved to block a big media company from becoming even bigger — the once unthinkable acquisition promises to reshape Hollywood and Silicon Valley. It is the biggest counterattack from a traditional media company against the tech giants that have aggressively moved into the entertainment business.

Disney now has enough muscle to become a true competitor to Netflix, Apple, Amazon, Google and Facebook in the fast-growing realm of online video.
Disney  M&A  mergers_&_acquisitions  streaming  mass_media  antitrust  21st_Century_Fox  Department_of_Justice 
december 2017 by jerryking
IKEA Jumps Into ‘Gig Economy’ With Deal for TaskRabbit
Sept. 28, 2017 | WSJ | By Saabira Chaudhuri and Eliot Brown.

IKEA agreed to acquire Silicon Valley startup TaskRabbit—the online marketplace that connects people with freelancers willing to run errands and do odd jobs—combining the pioneer of the flat pack with a trailblazer of the so-called gig economy.
....Documents related to a financing round from 2015 suggest TaskRabbit then had a valuation of about $50 million....the deal represents a bigger strategic tack at the furniture company. It also underscores a broader shift at many large companies grappling with big changes brought on by digitization. Many established corporations are increasingly turning to Silicon Valley to help their business grow, or slow their declines—sometimes spending heavily on small venture capital-backed startups that have strong traction with young consumers.

Especially where older industries are shifting rapidly, deals have piled up. Auto makers have become prolific investors and buyers of self-driving startups. Wal-Mart Stores Inc. has become one of the more active buyers of startups as it grapples with a shift to e-commerce, including a June deal to buy men’s online clothier Bonobos.

Several large firms have launched small Silicon Valley outposts and venture capital arms of their own. Often, though, they say it makes more sense to buy these startups than build a new brand or operation themselves.

The TaskRabbit deal is IKEA’s first foray anywhere near Silicon Valley. The privately held company—when it has bought anything at all—has tended to focus on forestry and manufacturing firm purchases..... IKEA intends to also learn from TaskRabbit’s digital expertise. Retailers and brands globally have been racing to capture shopper data in a bid to personalize their offerings and build customer loyalty.......The bulk of IKEA’s sales are still made in its sprawling out-of-town superstores that house everything from plants to beds. It has 357 stores across 29 countries. But it has worked to adapt to a rise in online shopping, rolling out home delivery and click-and-collect options. IKEA has also been opening small, centrally located stores situated near public transport that stock a limited range of offerings and are also used as collection points.

The company’s website had 2.1 billion visits in fiscal 2016, up 9% from the prior year. Earlier in September, it launched an augmented reality app that lets people place IKEA furniture in their homes. It has also souped up its product range, offering tables and lamps that double up as wireless phone chargers and bulbs that can be controlled wirelessly.

“As urbanization and digital transformation continue to challenge retail concepts we need to develop the business faster and in a more flexible way,” Mr. Brodin said. “An acquisition of TaskRabbit would be an exciting leap in this transformation.”
IKEA  TaskRabbit  gig_economy  home-assembly  mergers_&_acquisitions  M&A  Silicon_Valley  large_companies  brands  Fortune_500  start_ups  e-commerce  home-delivery  BOPIS  augmented_reality  urbanization  digital_strategies  retailers  product_launches 
september 2017 by jerryking
Benevolent Bacon? Nestle And Unilever Gobble Up Niche Brands - WSJ
By Saabira Chaudhuri
Sept. 7, 2017

The global packaged-food industry is facing fierce competition from a burgeoning number of small, but high-growth food and beverage brands. These brands have struck a chord with consumers looking for locally produced or more healthy, natural choices.

Amid this shift, sales from traditional players have flagged, spurring consolidation, cost cutting and restructuring.

Unilever fended off an unsolicited takeover by Kraft Heinz Co. earlier this year. Activist investor Dan Loeb’s Third Point hedge fund in June disclosed a major stake in Nestlé, calling for changes in strategy to improve shareholder returns. In response, the two consumer-goods firms have focused on cost cutting and promises to boost dividends, while going on the hunt for nimbler food and beverage brands with the potential to accelerate growth.

‘We’re experiencing a consumer shift toward plant-based proteins.’
—Nestlé USA Chief Executive Paul Grimwood
Nestlé’s deal to buy Sweet Earth comes less than three months after it bought a stake in subscription-meals company Freshly, which sells healthy, prepared meals to consumers across the U.S.

Moss Landing, Calif.-based Sweet Earth bills itself as a natural, ethical, environmentally conscious company that substitutes plant proteins for animal ones in meals like curries, stir fries, breakfast wraps, burgers and pasta. Founded in 2011, Sweet Earth is available in more than 10,000 stores in the U.S. It is stocked at independent natural grocers, as well as bigger chains like Amazon.com Inc.’s Whole Foods, Target Corp. , Kroger Co. and Wal-Mart Stores Inc.

“We’re experiencing a consumer shift toward plant-based proteins,” said Paul Grimwood, chief executive of Nestlé’s U.S. arm. Plant-based food, as a sector, is growing at double-digit percentages rates, Nestlé said.
Big_Food  brands  CPG  emotional_connections  Unilever  niches  mergers_&_acquisitions  M&A  Nestlé  shifting_tastes  start_ups  large_companies  Fortune_500  plant-based  healthy_lifestyles 
september 2017 by jerryking
It’s Time for Apple to Go Hollywood - WSJ
By Steve Vassallo
June 20, 2017

Apple’s hires, however, appear to be another in a series of plodding steps. It’s been a wildly successful slough, but there’s a palpable sense that the company is losing momentum with its testudine gait—that it’s been taken over by bean counters and no longer has the nerve or verve to “think different.”

Apple could change that impression and supercharge its video play by doing something that would make the Whole Foods deal look like small potatoes: buy Netflix .

It would cost several times the Whole Foods deal to buy Netflix, but with almost $260 billion in cash reserves, Apple can afford it. (Full disclosure: my firm was an early investor in Netflix but no longer holds any shares in the company.)

Purchasing Netflix would give Apple three critical things it needs to succeed.

• Content creation. As Apple learned from “Planet of the Apps,” its failed reality TV series about iPhone app developers (really), producing original programming is difficult. With all due respect to Messrs. Erlicht and Van Amburg, simply adding a couple of studio execs probably won’t be enough. In acquiring Netflix—which has produced an endless string of award-winning hits, from “House of Cards” to “Stranger Things”—the iPhone company would gain instant credibility and proven expertise in creating premium content at scale.

• Vertical integration. Apple is the most successful walled garden in history. Taking video creation and distribution in-house would satisfy that longstanding business model.

• International expansion. Content providers now have to think and act globally.... Netflix is available in more than 190 countries. Buy it, and Apple owns the world’s first truly global TV network.

One more thing, to quote the man in the black turtleneck. In addition to content, another enormous asset Apple would get from buying Netflix is its CEO, Reed Hastings. Without a clear successor to Tim Cook on the horizon, it would be malpractice if Apple’s board didn’t have some names in mind.
Apple  Netflix  economies_of_scale  M&A  Hollywood  content_creators  vertical_integration  in-house  Reed_Hastings  international_expansion  think_differently  original_programming 
june 2017 by jerryking
Why a Music Mogul Is Snapping Up Tiny Trade Magazines
March 19, 2017 | WSJ | By HANNAH KARP.

the music industry is mounting a comeback, one of the most powerful men in the business is snapping up some of its least flashy assets: trade publications.

Music mogul Irving Azoff and a business partner, Tim Leiweke, recently purchased Venues Today, and are in talks to buy Pollstar, people familiar with the matter said. Both outlets cover the live-music business.

Rather than simply trying to pry readers or advertisers from the music industry’s biggest trade magazine, Billboard, the two men are primarily interested in using the magazines to break into the conference business.....The surge of interest in music’s more obscure trades comes as the concert industry continues a long boom and the recorded-music business rebounds after years of declining sales. While magazines and newspapers across the board are generally struggling to compete for advertisers and readers with Facebook Inc. and Alphabet Inc.’s Google, industry trades are closely tied to the health of the businesses they cover, with the firms in those industries being their primary advertisers.

Billboard executives view the entrance of Mr. Azoff and Mr. Leiweke into music media not as a threat but as welcome validation of the music industry’s recovery, according to a person familiar with the matter, who added that Billboard’s revenue has increased 86% since 2013....Mr. Azoff is the former executive chairman of the country’s biggest concert promoter, Live Nation Entertainment Inc.; Mr. Leiweke is the former chief executive of Live Nation’s next-largest competitor, Anschutz Entertainment Group.

Messrs. Azoff and Leiweke could use conferences to help Oak View Group, their venue-management company, which collects annual fees from about two dozen arenas in exchange for sponsorships, event booking and other services.

Controlling the concert trades also allows Mr. Azoff to take on Billboard, a publication he has publicly criticized as it broadened its appeal to woo readers and bigger advertisers from outside the music industry.
music_industry  mergers_&_acquisitions  the_Eagles  M&A  trade_publications  back-house_opportunities  Tim_Leiweke  music  magazines  moguls  concerts  live_music  live_performances 
march 2017 by jerryking
Big Companies Should Collaborate with Startups
Eddie YoonSteve Hughes
FEBRUARY 25, 2016

Growth is increasingly hard to come by, so large companies are increasingly looking to entrepreneurs to help them find it. In the food and beverage category, growth came from 20,000 small companies outside of the top 100, which together saw revenue grow by $17 billion dollars.
Despite that aggregate revenue growth, not every startup is successful — in fact, the vast majority will fail.

Ironically, startups and established companies would both improve their success rates if they collaborated instead of competed. Startups and established companies bring two distinct and equally integral skills to the table. Startups excel at giving birth to successful proof of concepts; larger companies are much better at successfully scaling proof of concepts.

Startups are better at detecting and unlocking emerging and latent demand. But they often stumble at scaling their proof of concept, not only because they’re often doing it for the first time, but also because the skills necessary for creating are not the same as scaling. Startups must be agile and adapt their value proposition several times until they get it right. According to Forbes, 58% of startups successfully figure out a clear market need for what they have.

In contrast, big companies often end up launching things they can make, not what people want.

Successful collaboration between startups and established companies must go beyond financial deals: it must be personal and mission-oriented.....areas of emerging and latent demand are often highly concentrated.... spend time physically in hotbeds specific to your sector. ....met people...walk the aisles ...... explore up and coming datasets. SPINs is a retail measurement company that covers the natural and organic grocers. Yet too many companies don’t even bother to acquire this data because they dismiss it as too small to matter.....Just as important as personal knowledge are personal relationships. ...spend time with customers....skew more toward emerging customers......connect with key people who have tight connections with both startups and established companies in your industry.....collaboration needs to be mission-oriented, meaning it has to be focused on something larger than financial success. ......Executives who wish to tap into the growth of these smaller companies will find that having a big checkbook is not going to be enough, and that waiting for an investment banker to bring them deals is the wrong approach. A mercenary mindset will only go so far. When big companies try to engage with startups, a missionary mindset will create better odds of success.
large_companies  Fortune_500  brands  scaling  start_ups  collaboration  face2face  personal_meetings  personal_touch  information_sources  personal_relationships  personal_knowledge  HBR  growth  funding  M&A  success_rates  latent  hidden  proof-of-concepts  mindsets  missionaries  mission-driven  Mondolez  cultural_clash  Gulliver_strategies 
march 2017 by jerryking
Law firms will pay price for failure to hold off hackers | Evernote Web
31 December/1 January 2017 | Financial Times | Brooke Masters.

"This case of cyber meets securities fraud should serve as a wake-up call for law firms around the world: You are and will be targets of cyber hacking, because you have information available to would-be criminals," Bharara said in a statement....Other professional services firms should take note. This is not the first time the industry has been hit by hackers who specialise in what is becoming known as "outsider trading"....Accounting firms that provide tax advice on mergers, boutique advisory forms, and consultants who weigh in on synergies and downsizing plans are almost certainly on the criminals' hit list....Professional service firms will not be so lucky. Banks and companies pay extremely high prices for outside advice. They expect professionalism and confidentiality in return. Getting hacked by a bunch of Chinese traders is hardly a strong recommendation of either.
Big_Law  Chinese  confidentiality  cyber_security  cyberattacks  hackers  hacking  law_firms  M&A  malware  mergers_&_acquisitions  Preet_Bharara  professional_service_firms  SEC  security_consciousness  securities_fraud  traders 
january 2017 by jerryking
For Non-Tech Companies, if You Can’t Build It, Buy a Start-Up - The New York Times
By LESLIE PICKER JAN. 2, 2017

Last year, the number of technology companies sold to non-tech companies surpassed those acquired by tech companies for the first time since the internet era began, according to data compiled by Bloomberg. Excluding private equity buyers, 682 tech companies were purchased by a company in an industry other than technology, while 655 were acquired by tech companies....Non-tech chief executives have been found mingling at technology conferences, trying to spot their next potential target. ....One major shift as to why non-tech executives are becoming more active in tech deal making is that they have become more comfortable with the technology itself.....The next challenge for many of these companies might be in integrating their tech start-ups with the main business.

When traditional companies acquired small technology companies, they typically would place them in a “digital division” separate from the rest of the company.

That too needs to change, according to Aryeh Bourkoff, the founder and chief executive of the investment bank LionTree.

“Technology should not be a division of a company, it should be integrated into every division,” he said.
start_ups  mergers_&_acquisitions  M&A  GE  Honeywell  post-deal_integration  Fortune_500  large_companies  brands 
january 2017 by jerryking
MA in GWR and Silicon Valley - Public Release
Merger and Acquisition Trends in Silicon Valley and the
Greater Washington Region:
2006 – 2011
Silicon_Valley  trends  M&A  mergers_&_acquisitions 
october 2016 by jerryking
Bayer-Monsanto deal the latest merger to sweep beleaguered agri-foods sector - The Globe and Mail
JEFF LEWIS
CALGARY — The Globe and Mail
Published Wednesday, Sep. 14, 2016

Agribusiness giants are bulking up to weather a severe industry slump that has hit everything from grain prices to farm incomes, putting pressure on earnings at some of the sector’s top firms.

German drug and crop chemical maker Bayer AG became the latest global heavyweight to enter the consolidation race, announcing Wednesday that it would acquire U.S. seeds company Monsanto Co. in a massive $66-billion (U.S.) takeover.
mergers_&_acquisitions  M&A  agribusiness  Bayer  Monsanto 
september 2016 by jerryking
New Back-Office Tech Can Be a Merger’s Best Friend - WSJ
By VIPAL MONGA
Sept. 5, 2016

As companies become more dependent on complex software systems to manage their businesses, smoothly combining different platforms is becoming a bigger factor in a merger’s success.

New software systems for accounting, inventory tracking and supply-chain management are helping companies combine operations faster by automating some of the grunt work that previously was done manually.

“If you can integrate faster, it becomes an advantage,” said John Hoffecker, a global vice chairman at consulting firm AlixPartners LLP.

Companies that integrate acquisitions more efficiently will be able to reap better returns from takeovers, which can in turn leave them more leeway to do future deals, Mr. Hoffecker said. “You can pay a higher price,” he said.
speed  systems_integration  back-office  mergers_&_acquisitions  M&A  technology 
september 2016 by jerryking
Why It’s Not Enough Just to Be Disruptive - The New York Times
By JEREMY G. PHILIPS AUG. 10, 2016

Short-term success may be driven by exceptional execution; long-term value creation requires building a defensible model.

Any microeconomics textbook will tell you there are limited sources of competitive advantage. The most valuable companies combine several reinforcing strands, like scale and customer loyalty.....

While it is hard to stay ahead solely through superior execution over an extended period, it is sometimes enough in the short term to draw a deep-pocketed buyer where there are strong, immediate synergies. Creating enormous value over the long term requires turning a tactical edge into some form of durable advantage....Superior tactical execution can still create real value, particularly where it provides ammunition for a bigger war (like Walmart’s battle with Amazon). And in the long term, value is created not by disruption, but by weaving together advantages (as both Amazon and Walmart have done in different ways) that together create a barrier that is hard to storm.
disruption  value_creation  Gillette  competitive_advantage  execution  books  slight_edge  Amazon  Wal-Mart  microeconomics  short-term  long-term  barriers_to_entry  compounded  kaleidoscopic  unfair_advantages  endurance  synergies  M&A  mergers_&_acquisitions 
august 2016 by jerryking
St-Hubert, Rona and new fears of a hollowed-out Quebec Inc. - The Globe and Mail
KONRAD YAKABUSKI
MONTREAL — The Globe and Mail
Published Thursday, Apr. 07, 2016

Existing institutions, starting with the Caisse de dépôt et placement du Québec, are increasingly seen as being unable or unwilling to play the gatekeeper role that prevented key businesses from falling into outside hands in the past. The Caisse, which manages investments for the Quebec Pension Plan and other provincial retirement regimes, is much more focused on global opportunities as it seeks the returns it needs to prepare for an onslaught of pensioners.

For former Rona chief executive officer Robert Dutton, that became painfully clear in 2012 when Lowe’s first tabled a hostile bid for the Quebec chain. Speaking out for the first time last week, Mr. Dutton told Radio-Canada that Caisse chief Michael Sabia had always favoured Rona’s sale, but was forced by then Liberal finance minister Raymond Bachand to block the Lowe’s bid in 2012. Mr. Dutton’s ouster and subsequent board changes, he said, were engineered by the Caisse to pave the way for a much richer bid by Lowe’s, a premium made possible by a weak Canadian dollar.

Mr. Sabia has offered a different version of events. In 2012, the Caisse, which owned about 17 per cent of Rona, believed that the Quebec chain could still be a consolidator in the North American home-renovation sector if it boosted its competitiveness. By early 2016, that plan no longer seemed feasible. “Rona was improving, but it was still not well-positioned,” Mr. Sabia said in February.
CDPQ  competitiveness  consolidation  economic_nationalism  gatekeepers  generational_change  hollowing_out  Konrad_Yakabuski  Quebec  M&A  mergers_&_acquisitions  multinationals  weak_dollar 
april 2016 by jerryking
The humbling of Valeant’s Michael Pearson - The Globe and Mail
TIM KILADZE
The humbling of Valeant’s Michael Pearson
SUBSCRIBERS ONLY
The Globe and Mail
Published Tuesday, Mar. 22, 2016

What we’re left with: A “Canadian” company we should happily disown, and critical reminders that certain business rules should never be broken. Chief among them: Debt is never a problem until, suddenly, it is; markets will love you until, suddenly, they don’t; and the roll-up game, driven by endless acquisitions, is nearly impossible to sustain.....By slashing R&D spending costs, Mr. Pearson freed up cash flow to buy more companies – whose R&D departments were then gutted to repeat the same trick. To juice earnings, he acquired Ottawa-based Biovail in 2010, which came with a Barbados-based subsidiary. Valeant started ushering U.S. profits to offshore tax domiciles – marking the first-ever pharmaceutical tax inversion and sending its corporate tax rate to the mid-single digits.

To fuel acquisitions, Mr. Pearson borrowed tens of billions of $ of incredibly cheap debt. By mid-2015, Valeant had $31-billion (U.S.) in debt and paid over $1-billion a year in interest.

There were warning signs these bold acts would backfire. Last March, Warren Buffett’s inner circle started to inflict damage. At an investor meeting, Charlie Munger, one of the value investor’s best friends, said he was “holding his nose” by looking at Valeant, adding that the company “wasn’t moral.”

That cautionary message did little to deter two of Valeant’s top investors: the Sequoia Fund – which has ties to Mr. Buffett – and Bill Ackman’s Pershing Square Capital Management. Whatever criticisms were hurled at the drug maker, they stood by it, repeatedly stressing that they believed in Mr. Pearson. Their faith in him seemed nearly biblical. And because they showed resolve, hedge funds kept piling in – momentum investing at its very worst. By the end of June, nearly 100 of them had stakes in the drug maker........One of the best lessons from the global financial crisis was that everything became correlated when the U.S. housing market crashed. The same is true for Valeant. Investigations into its pricing policy made investors worry about revenue; worries about the income statement morphed into fears about balance-sheet debt; leverage woes prevented Valeant from borrowing more to fund future acquisitions.

The cynicism turned investors’ momentum strategy on its head.
Valeant  Bay_Street  CEOs  pharmaceutical_industry  Charlie_Munger  Warren_Buffett  M&A  boards_&_directors_&_governance  correlations  hedge_funds  Pershing_Square  William_Ackman  debt  R&D  cash_flows  roll_ups 
march 2016 by jerryking
Dow, DuPont Deal Cements Activists’ Rise - WSJ
By DAVID BENOIT
Updated Dec. 11, 2015

The group painstakingly went through each business’s customers, raw materials, costs and sales forces. Trian reported back to Mr. Breen on how they thought the split should work.
Dow_Chemical  Dupont  mergers_&_acquisitions  M&A  shareholder_activism  CEOs  boards_&_directors_&_governance 
december 2015 by jerryking
Behind Martin Sorrell’s Data Binge - CMO Today - WSJ
Mar 12, 2015 | WSJ | By NATHALIE TADENA.

Sorrell, this is about putting his sprawling holding company in control of all the various data marketers are demanding nowadays to make sense of their ad campaigns. They want to know a lot about who is viewing. They want to know which TV shows or Web sites are ideal to reach their desired audience. And ultimately, they want to know how much an ad contributes to an actual sale of a product or service.

By becoming a global data powerhouse, WPP hopes to help clients draw connections across different data sources, better target audiences and ultimately improve the effectiveness of their advertising dollars.
data_sources  Martin_Sorrell  WPP  mergers_&_acquisitions  ROI  CMOs  M&A  data  metrics  measurements  advertising_agencies  advertising  marketing  data_driven  targeting  target_marketing 
march 2015 by jerryking
Boutique Investment Banks Gain Prestige - NYTimes.com
By MICHAEL J. DE LA MERCED DECEMBER 9, 2014

FINANCIAL SERVICES, INVESTMENT BANKING, MERGERS & ACQUISITIONS, THE DEAL CYCLE, ALTMAN, ROGER C, BANKING AND FINANCIAL INSTITUTIONS, CENTERVIEW PARTNERS, EFFRON, BLAIR W, EVERCORE PARTNERS INC, LAZARD LLC, MERGERS, ACQUISITIONS AND DIVESTITURES, MOELIS & CO, QATALYST PARTNERS,
investment_banking  Wall_Street  prestige  size  financial_services  mergers_&_acquisitions  M&A  Centreview  Qatalyst  boutiques  Lazard 
december 2014 by jerryking
An expert at the quick flip cooking up a whopper deal - FT.com
August 29, 2014 | FT | By Neil Munshi.

It did not take long for Mr Schwartz’s confidence to bear fruit. In 2013, when he was only 32 years old, he was put in charge of Burger King by 3G Capital of Brazil, its private equity owners. This week, only 16 days after turning 34, Mr Schwartz unveiled one of the biggest deals in fast-food history – Burger King’s $11.4bn acquisition of Tim Hortons, the Canadian coffee-and-doughnut chain...As might be expected for a young man playing in a well-established game, Mr Schwartz’s forte at Burger King has been financial engineering. A native of Long Island, he focused on finance at university before honing his number-crunching skills during stints in the mergers-and-acquisition arm of Credit Suisse First Boston and Altair Capital Management, a Connecticut hedge fund. He joined 3G as an analyst in 2005 and made partner three years later. In 2010, he led 3G’s $4bn leveraged buyout of Burger King and became its chief financial officer. Two years later, he helped 3G sell a roughly 30 per cent stake in the second-largest US burger chain for about $1.5bn. He became chief executive last year.
Burger_King  CEOs  Cornell  alumni  dealmakers  Tim_Hortons  M&A  private_equity  Daniel_Schwartz  3G_Capital  financial_engineering 
august 2014 by jerryking
When Media Mergers Limit More Than Competition - NYTimes.com
James B. Stewart, a columnist for The New York Times, explores the antitrust concerns related to a potential deal between Time Warner Inc. and 21st Century Fox. Publish Date July 25, 2014.
antitrust  consolidation  mergers_&_acquisitions  M&A  deal-making  regulation  21st_Century_Fox  competitive_landscape 
july 2014 by jerryking
U.S. agribusiness ADM gobbles up Wild Flavors for $3-billion - The Globe and Mail
FREYA BERRY AND ARNO SCHUETZE
LONDON/FRANKFURT — Reuters
Published Monday, Jul. 07 2014, 7:06 AM EDT
Last updated Monday, Jul. 07 2014
ADM  agribusiness  flavours  M&A  mergers_&_acquisitions 
july 2014 by jerryking
From Andreessen, a Lesson in Corporate Finance - NYTimes.com
By WILLIAM ALDEN APRIL 17, 2014

In a series of tweets on Thursday, Mr. Andreessen offered a framework for thinking about technology valuations — relying on metrics that hard-nosed financiers tend not to consider.

3/Value of company X to acquirer Y often = Potential impact to acquirer Y's business -- which has a lot more to do with Y than X.

4/For example, in product businesses, you'll often hear term "attach rate" -- acquirer Y can attach company X's product to Y's sales engine.

5/Ex: I sell $20B of servers/year; I buy storage company X doing $100M revenue/year; & I can attach X's product to 20% of my server sales.

6/Ex cont'd: I can generate new $20B*20% = $4B/year of storage sales attached to my server business. X's standalone revenue is irrelevant.

7/Ex cont'd: So I can pay up for storage company X based on its projected impact on MY business, way beyond X's independent valuation.
Marc_Andreessen  Andreessen_Horowitz  corporate_finance  start_ups  valuations  standalone  frameworks  software  mergers_&_acquisitions  M&A 
june 2014 by jerryking
Getting into Venture Capital
Subject: Getting into Venture Capital
Well. I don‘t want to sound like a bit of a dork, but I would say that Seth's advice is a bit too narrow. First. I would say that Seth ignores the other side o...
job_search  venture_capital  vc  M&A  family_office  private_equity 
january 2014 by jerryking
Brash Agent at William Morris Extends Reach in IMG Merger - NYTimes.com
December 17, 2013, 4:12 pm 13 Comments
Brash Agent at William Morris Extends Reach in IMG Merger
By BROOKS BARNES and DAVID GELLES
private_equity  Hollywood  Ari_Emanuel  talent_management  Silver_Lake  talent_representation  entertainment_industry  mergers_&_acquisitions  M&A  talent  chutzpah 
december 2013 by jerryking
Sysco to Buy US Foods for $3.5 Billion to Create Food-Distribution Giant - WSJ.com
By
Annie Gasparro,
Sarah E. Needleman
and
Ryan Dezember
connect
Updated Dec. 11, 2013
The two biggest U.S. food-distribution companies announced a merger that will create a giant with about $65 billion in annual revenue and enhanced clout over purchasing by institutions ranging from restaurants and hotels to hospitals and schools.

Sysco Corp. SYY 0.00% said it will buy rival US Foods for $3.5 billion, uniting two middlemen that are already central players in the service economy. Sysco alone has about 425,000 customers, and it and US Foods together collected about 27% of the revenue in the U.S. food-distribution market last year, according to research firm Technomic Inc....Founded in 1969, Sysco has grown to 48,100 employees world-wide, thanks in part to acquisitions of smaller regional players. But the US Foods deal is by far its largest to date.

Sysco considered buying US Foods almost seven years ago but didn't. Mr. DeLaney said the change of heart came because US Foods became a more efficient company.

He said US Foods has technology related to customer ordering and a mobile application that Sysco is interested in.
Sysco  food  foodservice  distribution_channels  mergers_&_acquisitions  M&A  Clayton_Dubilier_Rice  KKR  middlemen 
december 2013 by jerryking
Boardroom shifts spell trouble for big banks
Nov. 26 2013 | The Globe and Mail | BOYD ERMAN.
New directors bring new relationships, and Canada’s greying boardrooms herald an opportunity for foreign and independent investment banks that are steadily making inroads in the Canadian market...The days are long gone of an investment banker sitting on a Canadian company’s board and steering all the advisory business to his own bank (let’s be honest, odds are it was a man). Rules on director conflicts have largely ended that. But name a Canadian company and most people in finance can recite the house banker, and it’s often one that does the lending.

Those relationships are not going to just go away. But the potential for conflict of interest is going to mean that the major banks are going to find themselves sharing merger fees more often with outside firms that are independent. Board renewal is only going to accelerate that.
Boyd_Erman  boards_&_directors_&_governance  conflicts_of_interest  advice  banks  demographic_changes  investment_banking  Bay_Street  mergers_&_acquisitions  M&A  relationships 
november 2013 by jerryking
Messaging Service Snapchat Spurned $3 Billion Facebook Bid - WSJ.com
By
Evelyn M. Rusli and
Douglas MacMillan
connect
Updated Nov. 13, 2013

Mr. Spiegel's company has no sales and no business model—but it does have a smartphone app that delivers hundreds of millions of messages, mostly from teenagers and young adults, that disappear in 10 seconds or less.
Snapchat  Facebook  M&A  mergers_&_acquisitions  ephemerality 
november 2013 by jerryking
Retailers warn of spreading ‘bloodbath’ - The Globe and Mail
Sep. 17 2013| The Globe and Mail | MARINA STRAUSS - RETAILING REPORTER.

The added stress is felt acutely in Canada’s grocery industry, which is the victim of an essentially “zero-sum game,” Perry Caicco, retail analyst at CIBC World Markets, said in a recent report. He projects that sales will pick up by about $1.6-billion this year – with little or no inflation – but that sales tied to the expansion of retail floor space “will eat up most of the sales growth.” As a result, grocers can expect almost no real sales increases this year or next at stores open a year or more, a critical retail measure, he warned.

“The market is not easy,” said Vicente Trius, president of Loblaw Cos. Ltd., which this summer unveiled its massive $12.4-billion deal to acquire Shoppers Drug Mart Corp. to help take on rivals.

“This generates pressure in the market because you have a consumer who spends less,” Mr. Trius said.....Retailers are also teaming up with others to gain economies of scale and round out their businesses. About a month before Loblaw announced its deal for Shoppers, Sobeys said it would buy Safeway Canada for $5.8-billion to help bolster its foothold in Western Canada.
competitive_landscape  retailers  Marina_Strauss  Loblaws  Wal-Mart  Costco  Target  Rona  slow_growth  economies_of_scale  zero-sum_game  mergers_&_acquisitions  M&A 
september 2013 by jerryking
What sent Shoppers and Loblaw down the aisle? Wal-Mart - The Globe and Mail
Jul. 19 2013 | The Globe and Mail | Sylvain Charlebois.

Wal-Mart’s purchase of Woolco in 1994 remains the most transformational transaction in Canada’s food retailing industry. Everything happening in food distribution today continues to be affected by it. Most Canadians didn’t realize it then, but Wal-Mart’s entrance into the Canadian market would change everything: the way we shop; what we buy; and, most importantly, how we buy and value food.

Ever since Wal-Mart entered the Canadian market, it never hid its ambition of becoming Canada’s top food retailer, as it has in the United States.
Shoppers  Loblaws  mergers_&_acquisitions  Sylvain_Charlebois  M&A  food  distribution_channels  Wal-Mart  grocery  supermarkets  retailers  Quebec  Sobeys  Target 
july 2013 by jerryking
With Shoppers, Loblaw targets coveted urban market - The Globe and Mail
SUSAN KRASHINSKY - MARKETING REPORTER

The Globe and Mail

Published Monday, Jul. 15 2013
Loblaws  retailers  M&A  mergers_&_acquisitions  urban  Susan_Krashinsky  Shoppers 
july 2013 by jerryking
Google buys Waze: Street plan
Jun 15th 2013 | | The Economist

The modern map is almost a living thing. Its habitat is the personal computer or (increasingly) the smartphone. It can carry layer upon layer of data, from traffic conditions and public-transport routes to reviews of local restaurants and indoor plans of shops, museums and airports. And as the world changes, the map adapts....In maps Google is already far ahead of both its rivals, Facebook and Apple. It has spent huge sums making the physical world as searchable as the digital realm, sending cars and aeroplanes to gather images and data from all over the planet. Recently Google showed off improvements to its maps. Among other things, they will be more personal: people can add their own landmarks (a favourite restaurant or museum, say), and similar or related places will be highlighted....Smartphones on which Waze’s app is open are tracked automatically. They contribute to an ever-changing map that shows drivers the best way to beat the traffic on the way to work or home. Drivers can also choose to report jams, as well as accidents, roadworks, speed traps and petrol prices. Thousands have also edited Waze’s maps. Waze users’ data, if eventually built into Google’s maps, should give a timelier, fuller picture of conditions on the roads.
mapping  Google  M&A  Waze  mergers_&_acquisitions  cyberphysical  Israeli  wayfinding  physical_world  indoors  traffic_congestion 
june 2013 by jerryking
Mobile Companies Crave Maps That Live and Breathe - NYTimes.com
By VINDU GOEL
Published: June 10, 2013

As mobile phones become all-in-one tools for living, suggesting where to eat and the fastest way to the dentist’s office, the map of where we are becomes a vital piece of data. From Facebook to Foursquare, Twitter to Travelocity, the companies that seek the attention of people on the go rely heavily on location to deliver relevant information, including advertising.....Maps that are dynamic, adapting to current conditions like traffic or the time of day, are the most useful of all. ...Context is everything — where you are, what other people have said about where you are, how to get there, what’s interesting to do when you get there,”... For users of smartphones that run Google’s Android software in particular, maps and directions are smoothly integrated into the address book, calendar and location-sensitive applications like Web searches and dining recommendations. Even for people with other phones, Google Maps still provides the back-end technology for many applications.

“We’re seeing maps become the canvas to everyone’s app,” said Eric Gundersen, chief executive of MapBox, which provides mapping tools to a number of popular apps like Foursquare and Evernote. “The map is alive; the map is responsive.”
mapping  Waze  crowdsourcing  Google  mergers_&_acquisitions  dynamic  canvas  M&A  location_based_services  wayfinding  contextual  real-time  Google-Maps  responsiveness 
june 2013 by jerryking
Yahoo Deal to Buy Tumblr Shows Power Shift - WSJ.com
May 20, 2013 | WSJ |By JOANN S. LUBLIN, AMIR EFRATI and SPENCER E. ANTE
mergers_&_acquisitions  M&A  Tumblr  Joann_S._Lublin  Spencer_Ante  Yahoo! 
may 2013 by jerryking
Going small the best route for cash-rich Metro
January 30, 2013 | G & M pg. B2 |by Sophie Cousineau.

Metro is a great operator with an outstanding track record. Its first-quarter results, which on Tuesday reported first-quarter profit of $121.4­ mil1ion compared with $103.7 ­million in the year earlier period, prove it yet again. Yet the Quebec grocery chain has had it relatively easy in recent years. Its main competitor, Loblaw, was its own worst enemy, struggling with its merchandising and its computer systems. Metro dominates the Quebec market with an estimated market share among conventional food distributors.

But the market is changing. WalMart Canada is expanding unreand Target is emerging as a formidable foe from the ruins of Zellers. To say that the competition is heating up is an understatement. These American retailers are shaking a Tabasco bottle over the Quebec and Ontario markets, dotting these provinces with super-sized stores and bountiful grocery aisles.

Target is not considered as serious as a menace as Wal­Mart. Many of Target's stores are located in shopping malls where Metro has exclusivity rights on the sale of food. Wal-­Mart, which started sending out food flyers to Quebec homes, is another story.
But even with an acquisition as important and as as Safeway’s, Metro could never “outscale” or even come close to it. And while Metro has two discount banners. its namesake stores don"t venture into price wars nor would they want to
go on the American retailers' turi war. By putting the accent on the freshest fruits and vegetables and the best shopping experience, Metro is taking a different tack from its American competitors.
Getting scale in the pharmacy business would make a lot more sense for Metro. As a pharmaceutical distributor and a drugstore operator under the Brunet banner, Metro is a regional Quebec player. Yet for there to be an acquisition, Metro needs a seller. While Jean Coutu Group Inc. is aging, the Coutu family has nevel expressed the slightest interest ir selling the business they control through multiple voting shares. Moreover, they are focusing their energy on Canada after retreating from the American market.
supermarkets  mergers_&_acquisitions  M&A  retailers  price_wars  pharmacies  grocery  ethnic_communities  scaling  Jean_Coutu  Wal-Mart  Target  Metro  competitive_landscape  Sophie_Cousineau  merchandising  shopping_malls 
january 2013 by jerryking
Meet Bay St.'s new breed of deal makers
April 4, 2007 | G&M pg. B10 | by Jacquie McNish.

Days after Ottawa's Halloween clampdown on income trusts, a team of Bay Street dealmakers flew to New York to alert a handful of private equity funds to potential Canadian trust takeovers.

Investment bankers pitch deals to ravenous private equity buyers all the time, but this group was unique because they were lawyers.

Canadian firms can no longer be complacent about private equity deals. As traditional Canadian corporate clients fall on the takeover battleground, Canada’s major firms are moving quickly to grab their share of private equity deals.

Some law firms are wooing private equity funds by aggressively promoting deals, while most are starting to share risks by taking fee cuts on unsuccessful takeovers and pocketing fee premiums on deal victories.

A few are so eager to represent the powerful acquirers that a single firm will act for multiple buyers vying for the same target.

The deal frenzy is shifting legal M&A away from long-term relationships to a more transaction-oriented practice that is seeing firms hop in and out of deals with an ever-changing group of buyers and sellers.

Stephen Donovan, co-head of Torys’ Private Equity Group, adds, "It is no longer enough to just know the law. There is a much more deliberate effort to bring deals to clients."
deal-making  dealmakers  lawyers  law_firms  Bay_Street  private_equity  prospectuses  complacency  crossborder  M&A  risk-sharing  transactions  relationships  transactional_relationships  rescue_investing  pitches  proactivity  entrepreneurial  opportunistic 
january 2013 by jerryking
How to Use a Lawyer in Buying or Selling a Company
December 1982 | The Journal of Buyouts & Acquisitions | By Betram K. Massing.

The lawyer for the buyer or seller in a private buyout or corporate acquisition is an important participant in the transaction. The lawyer's functions include: 1, counseling the client about the transaction. 2. advocating the client‘s position with the opposite party or in ancillary proceedings such as with government agencies. and 3. documenting and implementing the closing of the transaction. In counseling, the lawyer should call attention to potential risks and problems and suggest means of dealing with them. Tax implications, disposition of assets or shares, lenders' requirements, and the risk of latent liabilities are among the issues that arise early in an acquisitionA It is the cIient‘s responsibility to make decisions after being advised by the lawyer and to decide which points to compromise and which should be insisted upon. Clear communications between clients and lawyers and between buyers and sellers will make for a smoother transaction.
buying_a_business  selling_a_business  lawyers  howto  LBOs  mergers_&_acquisitions  M&A 
january 2013 by jerryking
A Few Necessary Precautions Before You Buy That Business
May 1991 | Profit-Building Strategies for Business Owners |

Buying a business takes great care. The first decision is what type of business to buy. For most people. it is best to choose a field in which they have had some experience. Sources for businesses up for sale include classified advertisements, business brokers. and informal networking. Next is a thorough investigation based on care and common sense. An initial question to ask is why the present owner is selling. The next step is to carefully examine the business. At this stage. an attorney and accountant can help check business books by looking for discrepancies in records of sales, earnings. and expenses. It is also important to check for pending lawsuits. If the sale involves real estate. it is vital to check for records of undisclosed liabilities. The next step is to determine how to finance the business. Usually. the new owner must put down of the purchase price and finance the balance. Sources for the remaining financing include the Small Business Administration. banks, and commercial lenders.
buying_a_business  CAMEX  mergers_&_acquisitions  M&A  decision_making  owners  precaution 
january 2013 by jerryking
China needs West's energy know-how, not resources
November 16, 2012 | Reuters | Christopher Swan.

A change in tactic could smooth China's path. The country has plenty of its own hydrocarbons and lacks only the know-how to extract them. In fact, at about 36 trillion cubic metres, China's shale gas reserves are estimated by the U.S. government to be 50 per cent larger than those of the United States. Acquiring services and technology companies would help increase domestic output.

Targeting a giant like Halliburton might stir the same sort of resistance China experiences now. There are, however, plenty of smaller rivals that probably wouldn't.
China  CNOOC  Halliburton  mergers_&_acquisitions  M&A  nationalism  shale_oil  hydraulic_fracturing  backlash  protectionism  economic_nationalism  knowledge 
december 2012 by jerryking
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