Renatus’ Weekly M&A Newsletter – 14/06/2020
June 15, 2020Renatus’ Weekly M&A Newsletter – 24/05/2020
May 24, 2020
Renatus Weekly M&A & Company Performance Private Equity Newsletter 07/06/2020
Dear Reader,
You are receiving this mail every week as we see you as a key partner and we look forward to continuing to enjoy our journey with you over the decades ahead.
Please find below this week’s newsletter covering the latest M&A, company performance, fundraisings and executive moves.
M&A ACTIVITY
Statsols is acquired by Insightful Science
Deal Details: Statsols, which owns the clinical trial design platform nQuery, has been acquired by Insight Partners’ portfolio company Insightful Science for an undisclosed sum.
Cork-headquartered Statsols was founded in 1984 as a subsidiary of Californian software company BMDP Statistical Software Inc which later, through a management buy-out, formed the now independent company, Statistical Solutions Ltd, trading as Statsols. Prior to the transaction, Statsols was primarily owned by Thomas Hurley, Kevin Sievewright and Donald Rubin along with a number of minority shareholders, typical of an MBO. The business had turnover of €1.4m in its financial year to October 2019.
Now an international company, Statsols has been leading the market through statistical innovation for over 20 years. nQuery is the world’s most trusted clinical trial design platform.
Insight Partners is a leading global venture capital and private equity firm investing in high-growth technology and software companies.
Insightful Science is a California-based technology company with category-leading software designed to empower scientists at every stage of the research and development process. Insightful Science will add Statsols to its Data Analysis & Visualization division.
Advisers: This is another transaction for Deloitte’s Munster-based Corporate Finance Partner Ronan Murray, who with his team provided lead M&A advisory services to the Vendor.
A ReganWall team of Adrian Wall and Sarah Connolly represented Statsols on legals, while Willkie Farr Gallagher New York acted for Insightful Science.
Insight Partners was advised by a cross-departmental Matheson team led by Corporate M&A partner Brian McCloskey and senior associate Enda Garvey.
Renatus Comment: This acquisition is a huge boost to Statsol, the company behind nQuery, as it will allow the company to partner with Insightful Sciences portfolio of Data Analysis & Visualisation companies. nQuery is currently operating with c. 50k users and this acquisition will open the business up to 1 million+ users which are being served by Insightful Science. On the other hand, it will help facilitate Insightful Science in expanding its capabilities from the pre-clinical market to the clinical ecosystem.
FDA approval is a long and strenuous process that involves a number of different phases and trials. According to Statsols website, nQuery covers all phases (I-IV) and in 2019, 90% of organisations with FDA approved clinical trials used nQuery.
Source: Insightful Science
Deloitte Ireland acquires DNM
Deal Details: Deloitte Ireland has acquired Irish cloud and managed services business DNM. The financial consideration of the deal was not disclosed.
Dublin-based DNM, founded in 2000, is an international consultancy, providing innovative solutions in the areas of Cloud, Managed Services and Analytics. It has over 120 enterprise customers across Asia, Europe and North America. The DNM team of 28 people will join the Consulting business at Deloitte.
Deloitte is the largest global professional services and consulting network with over 312,000 professionals in more than 150 countries. In Ireland, Deloitte has approximately 3,000 people providing audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries.
Advisers: LK Shields acted on legals for Deloitte.
Renatus Comment: Deloitte has made concerted steps recently to diversify its revenue streams and to reduce its dependency on traditional audit, tax, and advisory services.
Organic initiatives such as their Blockchain Lab and strategic acquisitions like DNM should help Deloitte retain their standing as a critical partner to their clients into the future.
As Irish businesses evolve, and technology becomes ever more embedded, the range of services required will change and grow. Deloitte appears to be recognising this and is staying one step ahead of potential competition.
Source: Deloitte
COMPANY PERFORMANCE
EBITDA is an accounting term and is often the best indicator of profitability in non-capital-intensive businesses before financing and tax are considered. In capital-intensive businesses EBIT or EBITDA less average Capital Expenditure are often better measures. YoY is an acronym for the year-on-year movement in turnover, EBITDA, etc.
Established in 1963, Michael Nugent Ltd is one of the leading mechanical and electrical services providers in Northern Ireland.
In its financial year to September 2019, it recorded revenue of £30.9m and EBITDA of £1.3m. EBITDA increased by 3.9% YoY despite revenue decreasing by 6.8% due to gross margins being 14.1% versus 11.7% last year. Cash increased by c. £1.8m during the year.
The business is wholly owned by Michael and Marcia Nugent.
Coolrain Sawmills Limited is a saw mill in Co. Laois which is dedicated to the manufacture and delivery of timber products for the manufacturing industries. Since its inception in 1984, the company has introduced Garden Living, one of Ireland’s top producers and suppliers of swings, slides, garden fencing, timber panels, decking, timber entrance & field gates as well as commercial timbers.
In FY19, the company had a positive year which saw revenue increase by 20.0% to c. €17.2m and EBITDA increase by 11.9% to c. €1.5m. Cash increased by c. €10k during the year which left the company with an overdrawn net cash balance of c. €207k which can be seen in the adjacent table. The primary reason for the cash movement was a c. €1.3m redemption of shares.
The company employed an average of 68 staff during FY19 at a cost of c. €2.4m. The company is 100% owned by Declan Hutchinson.
Established in Dublin over 30 years ago, FG Wilson Engineering is a provider of diesel and gas generators
In FY19, turnover increased by c. 6% to c. €12.9m while EBITDA declined by c. 25% to c. €1.4m. The EBITDA decline can be traced to a four percentage point decline in gross margins coupled with a c. €115k increase in administrative costs. Cash increased by c. €11.3m during the year to end at c. €15.2m. The large increase in cash was due to working capital movements caused by a large order being placed at year end resulting in an increase in stocks and trade creditors according to the directors.
The business is owned by Venler Limited (32%), David BlennerHassett (32%), Tekad Limited (27%) and Darren Gleeson (5%).
RECENT FUNDRAISINGS
Who: Cork-based AI supply chain company Keelvar, founded in 2012 by Alan Holland, has secured funding.
What: €16m Series A funding round was led by Elephant Partners and Mosaic with participation from Paua Ventures.
Keelvar was advised by ReganWall on this transaction. A LK Shields team, led by Emmet Scully and supported by Lester Sosa-Villatoro and James Green, acted for Elephant Partners.
Why: The financing is to be used to support the company’s continued expansion in Europe and the US, as well as increased investment in the company’s core technologies and solutions.
Source: Irish Times
Who: Shorla Pharma, an Irish healthcare start-up that develops pharmaceutical therapies to help cancer patients, has raised funding.
What: The €7.4m Series A investment round was led by Dublin-based venture capital firm Seroba Life Sciences. Enterprise Ireland was among the other participants.
Why: The funding will be used for scaling up the business and bringing products to the market.
Source: Irish Times
Who: Carlow-based Xenon, developer of Fever Defence infrared temperature testing device, has secured funding.
What: A reported €1m investment was made by New York venture capitalists Antonio Ruiz-Gimenez and Kerry Propper.
Why: The investment will help the company to scale up its operations across Europe and the US.
Source: RTE
Who: State-backed Valley Healthcare has raised funding. Valley Healthcare was set up by the Irish Infrastructure Fund to invest in primary care centres. It has invested €100m to-date and is managed by Glencar Healthcare, AMP Capital and Irish Life.
What: The organisation has secured €110m debt facility from AIB to fund continued investment. Valley Healthcare was advised on the raise by a BHSM property team of Rob Gibbons and Siobhan Whelan.
Why: The funding will be put toward doubling the number of it primary care centres to 26.
Source: Business Post
Who: Center Parcs, the family holiday resort which has one location in Longford and four others in the UK. The business was acquired by Brookfield Asset Management, a Canadian investment fund, in 2015 for £750m. All of the company’s locations have been closed since early March due to the pandemic.
What: The resort has reportedly received a cash injection of €5m, through a subsidiary of Brookfield which based in the Cayman Islands.
Why: The reason for the injection was not disclosed.
Source: Business Post
EXECUTIVE AND BOARD APPOINTMENTS
We in Renatus believe that more important than the deals are the people and we have teamed up with leaders in this field Korn Ferry to provide you with details of key recent executive and board level appointments.
Gerry Fitzpatrick
Source: (Google Images & LinkedIn)
THOUGHT FOR THE WEEK
Angela Merkel’s measures introduced for her country during the week definitely caused heads turning here:
€130bn of tax cuts and spending increases equating to 4% of GDP.
It was fast and well constructed including but not limited to:
- Temporary cut in VAT;
- Grants for SMEs;
- Aid for municipalities;
- Family payments worth €300 per child;
- Transport stimulus;
- Digital Infrastructure; and
- Direct aid for hospitality and leisure sectors.
Let’s hope that when we get a Government, we get similar help along the lines requested by smerecovery.ie and sorc.ie
@RenatusCapital Tweets
€3bn
The month-on-month increase in the level of savings by Irish households for April 2020. This coincides with the CSO’s report of the decrease in retail sales. @CentralBank @irishexaminer
39.2
The AIB Ireland Purchasing Managers’ Index (PMI) for May 2020, up on last month’s reading of 36 showing the industry’s decline pace is slowing. A reading below 50 indicates contraction. @IrishTimesBiz
83%
The number of companies to continue to offer remote working options to their staff once they reopen, according to a survey by recruitment specialists Osbourne. @irishexaminer
25%
The year-on-year increase in the grocery sales in Ireland over the period of 12 weeks to May 17th amounting to €3.2bn spent on food and household items, according to Kantar survey. @irishexaminer
c. 36K
The week-on-week decrease in the number of people in receipt of the Covid-19 PUP amounting to c. 543K people, according to the latest figures from the Department of Employment Affairs and Social Protection. @RTEbusiness
72.3%
The year-on-year fall in the number of new car registrations for May 2020 amounting to 1,751 cars registered according to SIMI. @irishexaminer
55.2% & 72%
The y-o-y decrease in the volume of clearances for autodiesel and unleaded petrol, respectively, according to @CSOIreland
46.5%
The year-on-year decrease in the number of mortgage approvals for April 2020 amounting to 2,200 approvals to the value of €525m, according to data from BPFI. @IrishTimesBiz
26.1%
The Covid-19 Adjusted Measure of Unemployment for May 2020 down from 28.2% in April, according to @CSOIreland
14.9 & 15.4%
The year-on-year increase in the Building and Construction volume and value index for Q1 2020, according to @CSOIreland
ABOUT RENATUS
Renatus was established in 2014 by Mark Flood and Brendan Traynor to provide growth funding to growing Irish SMEs and to partner with ambitious management teams to help companies reach their full potential.
Renatus targets companies with sustainable earnings of €1m+ and valuations of €5m and above. Our typical solutions include:
- Succession Planning
- Management Buyouts / Buy-Ins
- Funding for organic growth
- Acquisition Funding; and
- Share Sales
OUR INVESTMENTS
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