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Renatus’ Weekly M&A Newsletter – 30/05/2021
May 31, 2021
Renatus’ Weekly M&A Newsletter – 06/06/2021
June 6, 2021
June 13, 2021

CMI acquires Brookland Computer Services, Crotty acquires Martin Insurance, Aston Lark acquires McMahon Galvin, LetsGetChecked secures funding round, and much more in this weeks Renatus Private Equity weekly M&A newsletter.

Renatus Private Equity Dublin, Ireland

Renatus Weekly M&A & Company Performance Private Equity Newsletter 13/06/2021

Dear Reader,

Please find below this week’s newsletter covering the latest M&A, company performance, fundraisings and executive moves.

TOM BYRNE RIP

It is with huge sadness that we write this note.

Tom Byrne, chairman of our first Renatus fund passed away last week. Tom was a proud Mayo and family man. He was also one of the most respected Irish corporate financiers of his generation.

He was a huge support to Renatus getting off the ground and we will miss him greatly and hold very fond memories. Our thoughts are with his wife Phil, sons Stephen, Andrew and David, extended family and friends.

May Tom rest in peace.

M&A ACTIVITY

CMI acquires Brookland Computer Services

CMI acquires Brookland Computer Services

Deal Details: Belfast-based CMI has acquired London-based Brookland Computer Services for an undisclosed sum.

CMI create, design, deliver and support informed & intelligent strategies to navigate shifting technology, keeping organisations effective & secure.

The acquisition of Brookland takes CMI to a turnover in excess of £13m with a staff of 100, based in four sites across the UK – Belfast, London, Cheam and Reading.

Brookland offers a range of cloud hosting services, utilising its own data centre capability combined with extensive use of the Microsoft Azure platform. It has 20 employees and a client base of 150 from financial, manufacturing, and professional services sectors amongst others.

Advisers: HNH acted as lead advisor to CMI and also carried out FDD and Tax DD on Brooklands. Edwards & Co. acted as legal advisers.

Renatus Comment: CMI have been utilising acquisitions as part of its expansion strategy for a number of years. In 2019, it partnered with UK private equity firm Panoramic Growth Equity to acquire London-based BTA Limited which doubled the size of the business at the time.  Prior to that, CMI acquired Solsis.

CMI is a good case study of how strategic acquisitions can be used not only to scale a business but to also internationalise it and penetrate new markets.

Source: CMI

Crotty acquires Martin Insurance

Crotty acquires Martin Insurance

Deal Details: Dublin-based Crotty Insurance has acquired Martin Insurance for an undisclosed amount.

Crotty Insurance is one of Ireland’s leading brokers, offering commercial insurance cover with the best prices to a large range of business sectors. Crotty was acquired by Global Risk Partners in September 2020.

Martin Insurance is a Cavan-based family business established in 1980 by Seamus Martin and now led by son James Martin. Its clients include some of Ireland’s largest firms but it also caters for sole traders and private individuals.

Advisers:
Martin Insurance:
RBK team consisting of Chris Ball (Corporate Finance) and Jackie Masterson (Tax), KBG (Auditors) and Adrian Burke (Legals).

Crotty Insurance:
​​​​​​Crowe and Wallace Corporate Counsel.

 

Renatus Comment: The insurance broker space continues to be one of the most active pockets for M&A activity in the Irish market. Crotty was acquired by UK insurance company Global Risk Partners less than a year ago. Private equity firm Searchlight Capital Partners acquired a majority stake in Global Risk Partners in June 2020 and it is likely that they will be seeking to do further acquisitions in the space to build market share.

In its latest set of accounts to the period ending April FY20, Martin Insurances made a reported operating profit of c. €208k and revenue of €1.17m. Pre-transaction, Martin Insurance was owned by James and Aileen Martin.

Source: InsuranceBusinessMag.com

Aston Lark acquires McMahon Galvin

Aston Lark acquires McMahon Galvin

Deal Details: Aston Lark has completed the acquisition of McMahon Galvin Limited for an undisclosed amount.

Aston Lark is a Goldman Sachs and Bowmark Capital backed chartered insurance broker formed in 2018 when two of the UK’s largest independent insurance brokers came together: Aston Scott Group and Lark Group. It employs 1000+ staff in over 45 regional locations across the UK and Ireland.

​​​​​​Founded in 1970, McMahon Galvin provides home and car insurance to individuals as well as a full range of insurance services to businesses.

Advisers:

McMahon Galvin were advised by Gareth Cosgrove from Grant Thornton (Corporate Finance) and George Kennedy from Holmes (legals).

Renatus Comment: Aston Lark is a key player in the consolidation activity going on in the insurance brokerage sector. This is the fourth acquisition made by Aston Lark in Ireland in 2021, having already completed three acquisitions this year – North County Brokers, O’Loughlin Insurance Group and Brady Burns & Associates.

Source: Aston Lark press release

Erisberg acquires HCI

Erisberg acquires HCI

Deal Details: Erisberg has made a significant investment in Health Care Informed (HCI). The deal consideration was not disclosed.

HCI, based in Dublin and Galway, is Ireland’s leading healthcare quality management and patient safety services company.

The investment is designed to support HCI’s continued growth and expansion both in Ireland and international markets.

John Sweeney, Founder and CEO of HCI will continue to lead the business in his current role, alongside HCI’s highly experienced team.

Advisers: ​​​​​​
Erisberg:
L.K. Shields (Legal), EY (Tax) and BCA (Finance)

Health Care Informed:
Ronan Daly Jermyn (Legal), and O’Malley Accountants (Finance)

 

Renatus Comment: The Healthcare Quality Management sector is an interesting space that is likely seeing an uptick in activity linked an aging population, rising costs of healthcare and the costs associated with medical errors. Ensuring a standard level of care is crucial for operators in the healthcare space.

Source: Health Care Informed

Deals in the Making & Other News

DCC acquistion of Jones Oil is approved by regulators

Deal Details: DCC Energy Limited, a wholly-owned subsidiary of DCC plc, acquisition of sole control of Jones Oil Limited and subsidiaries has been cleared by the Competition and Consumer Protection Commission.

Source: CCPC

Brown Thomas and Arnotts’ parent reportedly considering a bid

Deal Details: It is reported that the Weston family have been approached with a surprise offer of €4.66bn for the Selfridges Group, including Dublin premier department stores Arnotts and Brown Thomas.

Selfridges have not confirmed the report however real estate bulletin React News reported that it has appointed investment bank Credit Suisse to advise on the offer.

Source: Irish Times

Irish Life considering bid for Davy

Deal Details: Irish Life, Ireland’s largest life and pensions company, is reported to be considering to make a bid to buy stockbroker Davy.

Final bids for Davy are due for submission this Friday and the company is reportedly worth €400m. It’s reported that six interested parties have emerged from the first round of bidding. Cited participants include Bank of Ireland, Tilney Smith & Williamson and a potential joint bid from Melior Equity Partners and Carlyle.

Source: Sunday Times

Brookfield Renewable Partners completes sale of windfarms

Deal Details: Brookfield Renewable Partners, a Canadian Asset manager, completed the sale of its Irish wind farms to Danish company Orsted for €571m last week.

Brookfield acquired the wind energy assets of Bord Gais for €700m in 2014 and built the portfolio to more than 700 megawatts of operating assets and expanded the development pipeline to 1,000 megawatts.

Source: Sunday Times

Stobart Air to appoint liquidator

Deal Details: Regional aviation operator Stobart Air is to appoint a liquidator to wind up the company after its net liabilities tripled to €68.5m over the last year. Stobart operates all regional flights for Aer Lingus.

Source: Sunday Business Post

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.

M & J McGowans Limited, trading as McGowans Print, is a specialist print operator with offices in Dublin and Belfast.

For the period ending December FY 19 the business grew turnover by c. 7% to €19.0m and grew EBITDA by c. 14% to €2.0m.

Cash balance remained largely flat year-on-year at c. €1.2m. Cashflow generated from operations during the period was predominantly used on debt repayments (€1.2m) and fixed asst purchases (c. €390k)

The business employed a total of 186 staff during the year at a total cost of c. €7m. McGowans Print is owned equally by Janice O’Hare and Malcolm McGowan.

McElvaney Motors is a seller and repairer of new and used trucks and vans. The company has operations in Monaghan and Dublin and also carries out ancilliary activities such as truck/van hire, part sales and servicing.

For the period ending FY April 20, the business reported a revenue of c. €51.9m and an EBITDA of €1.7m, a year-on-year drop of c. 4% and c. 24%, respectively.

Cash slightly decreased by c. €260k during the period to end at c. €5.28m. The big drains on cash during the period was fixed asset purchases of c. €970k and a c. €680k investment into working capital. These were partially offset by a new loans drawn amounting to €200k during the period.

The business is wholly owned by Adrian McElvaney.

RECENT FUNDRAISINGS

Who: LetsGetChecked, a virtual care company founded by Peter Foley in 2015, closes a series D funding round.

What: The company raised $150m (€123m) bringing its total valuation to over $1bn. The funding round was led by Boston-based Casdin Capital, with further participation from CommonFund Capital, Illumina Ventures, Optum Ventures, Transformation Capital, HLM Venture Partners, and Qiming Venture Partners USA, and professional golfer Rory Mcllroy.

Why: The company said it planned to use the money to invest in and expand its services, including investment in its telehealth services, expand its pharmaceutical services in the US and other markets, and strengthen its commitment to delivering at-home diagnostic test kits directly to customers.

Source: Irish Times

Who: CyGenica, a biotech company using a non-viral, non-toxic platform to develop delivery solutions for drugs, gene editing components and antibiotics. The company has operations in Cork and India.

What: CyGenica has completed a $1.4m fundraise which was led by venture capital firm SOSV.

Why: The funds will be used to accelerate the development and validation of CyGenica’s proprietary technology, which enables safe, targeted and affordable intercellular drug delivery.

Advisers: Kieran Regan of Regan Wall advised CyGenica

Source: CyGenica press release

Who: Irish travel retail software Datalex has launches an equity raise.

What: The company seeks to raise €25m.

Why: The finances are required to repay extensive loans from its main shareholder Dermot Desmond and to ensure the company has enough working capital.

Advisers: Goodbody acted as Sole Financial Advisor, Bookrunner and Sponsor for Datalex.

Source: Irish Times

Who: Assure Hedge, Irish foreign-exchange technology company founded by Barry McCarthy, raises financing.

What: €5m was raised in Series A round valuing the company at €30m.

Why: The funds are to be used hire additional staff and invest in new product development and channels to market.

Advisers: Alan Ryan and Michael Bambrick of Wallace Corporate Counsel provided legal advice to Assure Hedge

Source: Irish Times

Who: Supply chain software company Overhaul, founded by Irishmen David Broe and Barry Conlon in 2016, raises funds.

What: $35m (€28.7m) round was led by Macquarie Capital led the latest fundraise with participation from Edison Partners and Avanta Ventures.

Why: Overhaul intends to use the financing to accelerate the development of solutions. Mr Broe said Overhaul intends to double headcount at the company over the coming year as it focuses on opportunities in Europe.

Source: Irish Times

Who: Bowsy, a Dublin-based technology business that connects graduate students with potential employers.

What: Bowsy has raised €308k in crowdfunding on Spark Crowdfunding which runs until June 18th. The company plans to raise €1.6m in series A funding within the next 18 months.

Why: The funding will be used to hire new developers to help improve the user experience of their product.

Source: Sunday Independent

Who: Irish conversational AI platform Webio has raised funds.

What: €1.5m was secured in pre-Series A funding round.

Why: Webio chief executive Cormac O’Neill said the funding would go towards further product development and increase staff numbers with a plan to double the company’s R&D team.

Advisers: Eoghan Doyle and Hugo Grattirola from Philip Lee acted for Finch Capital and Jerome Maume of OFX for Webio.

Source: Irish Times

Who: Peer-to-peer lending platform Linked Finance receives additional funding under the Covid lending scheme.

What: €5m is secured under the Government’s Covid-19 Credit Guarantee Scheme (CCGS).

Why: The company is launching a ‘Recharge SMEs’ loan, which will provide pubs, restaurants, accommodation businesses, and cafes with a loan of up to €50,000 to help them reopen, restock and rehire as pandemic restrictions are eased.

Source: Independent

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.


Ann-Marie O’Sullivan

Source:
(Google Images & LinkedIn)


Brian O’Gorman

Source:
(Google Images & LinkedIn)


James Menton

Source:
(Google Images & LinkedIn)


Niall O’Grady

Source:
(Google Images & LinkedIn)

THOUGHT FOR THE WEEK

The trajectory of the S&P 500 is beyond staggering. When you look at it over time it just looks like trees grow to the sky as it hit another record high on Friday. Is it structural based on the stocks held within in it or is it just a function of all the money that has been printed inflating it?

 

@RenatusCapital Tweets

31% & 26.9%

The year-on-year increase in the Irish manufacturers industries production and turnover indices, respectively, for April 2021, according to @CSOIreland

23.1%

The year-on-year increase in the Irish services value index for April 2021. The most notable changes were in Accommodation and Food Service Activities (+3.9%) and Administrative and Support Service Activities (-9.2%), according to @CSOIreland

1.7%

The year-on-year increase in the Irish consumer price index for May 2021. The most notable changes were in Housing, Water, Electricity, Gas & Other Fuels (+5.4%) and in Clothing & Footwear (-2.1%), according to @CSOIreland

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ABOUT RENATUS

Renatus was established in 2014 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 typically in the range of €5m – €20m. Our typical solutions include:

  • Succession planning
  • Management buyouts
  • Management buy-ins
  • Growth financing – both organic and acquisition growth financing
  • Full and partial share sale.
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Our Knowledge Centre is filled with insights from some of Ireland’s top business leaders on Succession Planning, Management Buyouts / Buy-Ins, Growth Financing and much more.

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    Adrian Stackpoole, Digital Marketing Associate

    • Adrian joined Renatus in 2018, initially as a Marketing Executive before moving into the role of Digital Marketing Associate. As part of his role, Adrian manages all the digital marketing aspects of Renatus as well as conducting digital research for portfolio companies.
    • Adrian holds with a BBS degree in Marketing and Entrepreneurship from the University of Limerick, as well as a Postgraduate degree from The Digital Marketing Institute.
    • Prior to joining Renatus, Adrian worked in New York with a start-up hospitality group, specalising in marketing and operations.
    TIERNAN O’HAGAN

    Tiernan O’Hagan, Associate

    • Tiernan recently joined Renatus Capital Partners as a Private Equity Associate. As part of his role, he researches and analyses the potential of new investments and acquisitions
    • Tiernan graduated with a B.Sc in business and law from DIT Aungier street & an MSc. in Entrepreneurship from Trinity College Dublin.
    • Previously worked with Capnua Corporate Finance for three months during a summer internship.
    • Tiernan is also in the process of sitting ACCA exams.
    Bronagh Kearns Renatus

    Bronagh Kearns, Associate

      • Bronagh recently joined Renatus as a Private Equity Associate. As part of her role, she will be researching and executing investment opportunities.
      • Bronagh holds a MSc in Quantitative Finance from UCD Michael Smurfit Business School and a BSc in Finance from University College Cork. Currently, Bronagh is in the process of obtaining the ACCA qualification.
      • Prior to joining Renatus, Bronagh worked as an Investment Banking Analyst in Rubicon Capital Advisors where she worked on M&A transactions on the execution side and financial modelling in the infrastructure sector. She also worked as an Investment Associate in River and Mercantile Solutions in London quantitatively screening different investment opportunities across all asset classes.
    Alan Manning Renatus

    Alan Manning, Associate

    • Alan joined Renatus Capital Partners in September 2021 as a Private Equity Associate. As part of his role, Alan researches and analyses potential investments and acquisitions.
    • Alan holds a B.Sc Finance from University College Cork.
    • Previously working in KPMG’s Consulting division, with the Financial Management Consulting team. During his time there he was engaged on a Finance Function Review for a European Travel Technology firm, and a review of the cash management strategy of an Irish Commercial Bank.
    • In the process of sitting ACCA exams.

    Conor Hall, Associate

    • Conor joined Renatus Capital Partners in June 2018 as a Private Equity Associate. As part of his role, Conor researches and analyses potential investments and acquisitions.
    • Conor holds an M.Sc. in Quantitative Finance from UCD Michael Smurfit Graduate Business School and a B.Sc. in Economics & Finance from UCD. He is currently working towards attaining the ACCA and CFA qualifications.
    • Prior to joining Renatus, Conor worked as an Analytics Analyst with Accenture, specialising in predictive modelling for fraud.

    Kyle Barry, Associate

    • Kyle joined Renatus Capital Partners in June 2016 as a Private Equity Associate. As part of Kyle’s role, he researches and analyses the potential of new investments and acquisitions.
    • Since joining, Kyle has worked on numerous transactions, including Simtech and Rennicks, and has worked with Renatus’ investee companies on a number of strategic projects.
    • Kyle holds an MSc. in Quantitative Finance (University College Dublin) and a BA Finance (Maynooth University). Currently, Kyle is in the process of completing the ACCA qualification.
    • Prior to joining Renatus, Kyle spent 15 months in Intel’s Finance department where he worked across the financial reporting, tax and capital financing teams.

    Philip Gardiner, Associate Director

    • Philip is an Associate Director with Renatus Capital Partners, having first joined the firm as its first employee in 2014.
    • Philip has responsibility for screening, assessment and structuring of new acquisitions.
    • He has worked on a number of transactions at Renatus including Boojum Mexican Restaurants and Simtech Aviation. Philip works actively with the boards of Boojum and Simtech Aviation.
    • Prior to joining Renatus, Philip spent four years in AIB’s corporate banking team where he worked on a mix of real estate and cash flow lending deals.
    • Philip is a member of the ACCA and holds an MSc. in Financial Services and a Bachelor in Business Studies, both from the University of Limerick.

    Jane Martin, Marketing and Administration Manager

    • Jane joined Renatus Capital Partners in June 2019 as a Marketing and Administration Manager. As part of Jane’s role, she writes the weekly newsletter, works on the CRM and looks after the admin and ad hoc tasks
    • Prior to joining Renatus, Jane worked as a Senior Account Manager in Mace Promotions where she worked closely with many SMEs as well as large corporations on their marketing projects

    Mark Flood, Director

    • Mark co-founded Renatus with Brendan Traynor in 2014. Prior to establishing Renatus, Mark spent seven years on the senior management team of the Racing Post in various operational and commercial roles. Before founding Renatus, Mark was Managing Director of the Racing Post’s Irish operation.
    • Prior to his career in the Racing Post, Mark was the first employee of FL Partners, an Irish based international private equity firm, where he was actively involved in over €300m worth of transactions.
    • Mark combines his financial, operational and commercial experience to bring value and energy to all partner companies.
    • Mark is a Chartered Accountant and holds a Bachelor of Commerce and Masters in Accounting from NUI Galway.

    Brendan Traynor, Director

    • Brendan is a co-founder of Renatus. Prior to establishing Renatus, he was a Director in BDO Corporate Finance specialising in M&A, MBO’s/MBI’s, debt and private equity fundraising across a diverse range of sectors and clients.
    • His career focus and passion is the Irish SME sector and his deal expertise covers sectors such as retail, manufacturing, FMCG, healthcare, avaiation, media, medical devices, food and agriculture, construction, and hotels and leisure.
    • Brendan is a Chartered Accountant and holds a Bachelor of Commerce from University College Dublin

    Conor Mehigan, Associate Director

    • Conor joined Renatus Capital Partners in 2021 as an Associate Director. Conor has responsibility for screening, assessment and structuring of new investments and acquisitions.
    • Prior to joining Renatus, Conor spent five years in IBI Corporate Finance specialising in M&A, debt and private equity fundraising for private and public companies across a range of sectors. Prior to his career in IBI Corporate Finance, Conor spent four years in Deloitte’s Corporate Finance Division, specialising in Transaction Services
    • Conor is a Chartered Accountant and holds a BSc in Finance from University College Cork

    Greg Dilger, Strategic Advisor

    • Greg Dilger is a former Executive Director of NCB Stockbrokers and Investec Wealth & Investment.
    • He is an investor and advisor to Renatus and brings years of relevant experience to our team.
    • Greg is also currently a Non-Executive Director of Brewin Dolphin Ireland.
    Patrick Dooley Renatus

    Patrick Dooley, Associate Director

    • Patrick joined Renatus in November 2022 as an Associate Director. Patrick has responsibility for screening, assessment and structuring of new investments and acquisitions.
    • Patrick previously held leading positions in Focus Capital Partners, PKF O’​Connor, Leddy & Holmes & EY.
    • Patrick is a charted accountant and holds a Bachelor of Accounting and Finance degree from DCU, along with a Masters degree in Accounting from TUD.

    John Dwyer, Chairman

    • John joined Renatus in 2018 as a Chairman. Prior to Renatus, John spent 30 years at PwC in the UK, 20 years as a Partner, John led the UK and Global Deals business at PwC and was an executive board member of the UK firm.
    • Prior to that, John led the UK and Global Private Equity business at PwC and worked with firms including 3i Group, Apax Partners, CVC Capital Partners and Cinven.
    • John is married to Natasha and they have three children. John works between Dublin and London and his charity work includes chairmanship of Irish Youth Foundation UK.
    • He is an advisor and Board member of Irish digital marketing firm Pigsback and media firm Racing Post.
    • John is a Chartered Accountant and holds a Bachelor of Commerce from UCD.