Please find below this week’s newsletter covering the latest M&A, company performance, fundraisings and executive moves.
We are so privileged in Renatus to get exposure to so many legendary entrepreneurs. For us, entrepreneurs are our heroes and we would admire them ahead of any sport or pop stars.
They are so unique and nobody can fully appreciate what they went through to get to where they are. The dynamic we often find when we get closer to our heroes and chat is that what should be the crowning moment for an entrepreneur in selling their business often turns out to be bittersweet.
We tripped across an amazing study this week which we have put a link to below which goes deeper into this. Twenty-two entrepreneurs who had successful exits of $10m+ were interviewed about their exit experience by Columbia Business School. The highlights of the paper are as follows:
The link to the article is here and is well worth reading:
Our model in Renatus is often to intercept entrepreneurs selling out completely and encourage them to roll into a new chapter with us and to bring us in as a value-added partner to help navigate the next chapter of growth and maybe chip off a few bob in the process.
Deal Details: Bauer Media Audio has agreed to acquire Cork’s Red FM. The deal consideration was not disclosed and is subject to regulatory approval.
Cork’s Red FM has a reported c. 129,000 listeners with Vienna Investments and The Irish Times as the main shareholders. In FY21, the business reported turnover of c. €3.4m which converted to an EBITDA of c. €0.4m.
Bauer Media Audio is Europe’s largest commercial radio group with Irish radio stations including Today FM, Newstalk, Spin 1038, and 98FM. The business is based in the UK and operates in countries including Ireland, the UK, Sweden, Norway, Denmark, Finland, Poland, Slovakia, and Portugal. In FY20, Bauer Media Audio reported turnover of c. £189.9m which converted to an EBITDA of c. £27.6m.
Cork’s Red FM:
Corporate Finance: Montanum Advisory led by Jim Mulqueen and Fiona McGuire.
Legal: Flynn O’Driscoll led by David Ryan (Partner, Corporate & Commercial), Elaine Cully (Solicitor, Corporate & Commercial) and Nicola Flannelly (Trainee Solicitor, Corporate & Commercial). The employment team was led by Caoimhe Heery (Partner, Head of Employment).
Bauer Media Audio:
Corporate Finance: Deloitte led by James Toomey, Simon Myciunka, Sebastian Bethge, Christoph Wilk, Joe Dempsey, Anya Cummins, Patrick McInerney, and Dylan Gibbons.
Legal: Matheson led by Brian McCloskey, Robert Barrett, Dan McAleese, Niall Collins, and Simon Shinkwin.
Renatus Comment: In 2021, UK-based Bauer Media Audio entered the Irish market with the acquisition of Denis O’Brien’s Communicorp radio group in a deal reported to be worth more than €100m. In 2018, The Irish Times Group acquired a stake in Cork’s Red FM when it completed the acquisition of all of the publishing and media interests of the Cork-based Landmark Media group. This deal included the acquisition of three local radio stations: WLR, Beat, and Cork’s Red FM.
Bauer Media Audio has been quick to challenge regulation within the sector. A cap on the ownership of commercial radio stations has been maintained by the Broadcasting Authority of Ireland (BAI), despite some stakeholders requesting its removal. There is a limit on an individual or group owning more than 25% of Ireland’s commercial radio services. In Denis O’Brien’s time, the share of Communicorp remained closer to c. 20%. However, with Bauer Media Audio acquiring Cork’s Red FM, the business is getting closer to reaching its ownership cap.
Source: Bauer Media Audio Press Release
Deal Details: Xperience has been acquired by mid-market private equity firm Bowmark for an undisclosed amount.
Xperience is based in Northern Ireland and provides IT services specializing in digital transformation. Xperience supports c. 800 small and medium-sized companies and employs c.170 people. The business reported FY21 revenues of c. £13.0m, which converted to an EBITDA of c. £1.5m. The business was owned by Iain O’Kane, Andrew Cavey, Patrick Leggett, Martin Mcallister, and Benjamin Marnham.
Bowmark Capital is a London-based private equity firm that invests in technology and services companies. The business has c. £ 1.7bn of funds under management.
Corporate Finance: HNH Group led by Wayne Horwood,
Legal: Davidson McDonnell led by Vicky Dummigan.
Corporate Finance: Deloitte led by James Toomey, Tom Elliott, Roy Mani, Oliver Bee, Rory Pickard, Anya Cummins, Patrick McInerney, Julie Worthington and Darian Rogerson.
Financial Due Diligence: EY led by Isaac Mulholland, and Matt Owens.
Renatus Comment: A well-deserved close for Iain O’Kane and his experienced team, working with some of the UK and Ireland’s biggest brands and leaders in technology. Xperience has sought to expand its business and capitalise on market growth through consolidation plays within the sector. The business has acquired Green Duck and Riverlite in the past two years, with more acquisitions reportedly planned with the support of Bowmark. As a result of the continued push for digital transformation, the widespread use of cloud services, and the growing challenge posed by cyber threats, an increasing number of SMEs are looking for a strategic IT partner that can offer an integrated business solution.
Source: Xperience Press Release
Deal Details: Schivo Medical has acquired APN Global for an undisclosed sum. Dunport provided the debt financing from its €335m Oak Corporate Credit fund.
Schivo Medical is a Waterford-based manufacturing firm specialising in minimally invasive surgical (MIS) devices and life science systems. In FY20, it reported a turnover of c. €19.6m which converted to EBITDA of c. €3.3m. It is currently led by CEO Graham Reeves and previously received an equity investment from MML Capital. The business is owned by various individuals and investors, including MML and CEO Graham Reeves.
APN Global is a Canadian manufacturer of valves, fittings, and tubing technologies for analytical instrumentation and MIS devices. It was established in 1970 by Claude Proteau, who was succeeded by his sons Jean and Yves. The business does not report turnover or EBITDA information.
Debt Advisory: Deloitte led by Brian Fennelly, and Rebecca Cuffe.
Legal: Addleshaw Goddard.
Renatus Comment: Having begun life as a multi-industry outsourced component manufacturing business, Schivo Medical shifted its focus towards the medical and life sciences sectors in 2016. After securing private equity backing from MML, Schivo has recently targeted expansion into the North American market. Last year it acquired Supreme Screw Products, a New York-based supplier of precision machining, laser processing, and assembly services with over 30,000 sq. ft of manufacturing space split between its two sites. This acquisition of APN Global adds a further 60,000 sq.ft facility to Schivo’s arsenal, giving it a significant presence in North America. The benefits of these deals include cost efficiencies realised by operating closer to high-growth target markets and synergies in R&D by pooling knowledge and resources with other experienced manufacturers of complex medical devices.
Source: Schivo Press Release
Deal Details: Label Craft has been acquired by Asteria group. Deal details have not been disclosed.
Label Craft is a Dublin-based packaging manufacturer that manufactures self-adhesive labels, leaflets, packaging and cartons, supplying to the pharmaceutical, healthcare, medical devices, cosmetic, veterinary and food and drinks industry. The business was founded in 1984 by Denise Browne and Michael O’Flaherty. In FY20, the business had a reported turnover of c. €9.4m, which converted to an EBITDA of c. €2.0m. The business was owned by Denise Browne and Michael O’Flaherty.
Asteria Group is a manufacturer of label solutions based in Belgium with operations across Europe. Asteria has completed over 23 acquisitions over the last four years, with label craft being its first acquisition in the ROI. Asteria Group was founded in 2018 following Belgian-Dutch private equity group Waterland’s investment in Belgian company Accent, which became the starting point of Asteria Group. It is led by Chief Executive Ives Declerck. The business does not report turnover or EBITDA information.
Corporate Finance: Key Capital.
Legal: Arthur Cox led by Sophie Frederix and Sergio dos Santos.
Legal: Flynn O’Driscoll led by David Ryan (Partner, Corporate & Commercial), Caoimhe Heery (Partner, Head of Employment), Elaine Cully (Solicitor, Corporate & Commercial), Kate Duffy (Solicitor, Employment), Majella Lynch (Senior Associate, Property) and Paddy Jordan (Trainee Solicitor, Corporate & Commercial).
Renatus Comment: Many of Label Craft’s end customers are in the pharmaceutical and medical device spaces. Ireland has a strong domestic medical device and pharma sector and has an excellent track record of attracting foreign investments from this sector. This acquisition will provide Asteria with a base in the attractive Irish market and will provide Label Craft with the support and additional resources to pursue further growth opportunities in Ireland and across Europe, particularly within the pharmaceutical sector.
Source: Label Craft Press Release
Deal Details: The former owners of System Label Roscommon are set to re-acquire the business from Multi-Color Labels.
System Label Roscommon is a label production company based in Co. Roscommon. Alan Beirne and Gordon Trimble have been re-appointed as directors of the company, having previously held the same positions during the period 2009 – 2016. In its most recent available accounts in FY19, it reported c. €3.9m turnover, which converted to an EBITDA of c. €460k.
Multi Color Corporation (MCC) is one of the largest label companies in the world. It has operations in 109 countries and has over 13,000 staff. It is reported to have annual revenue of c. $3 billion as of 2021.
Former owners of System Label Roscommon:
Legal: P O‘Connor & Sons led by Siobhan Durkin.
Corporate Finance: RBK led by Chris Ball, and Jennifer Brennan.
Tax: RBK led by Jackie Masterson and Chloe Kenny.
Renatus Comment: MCC was acquired by US private equity firm Clayton, Dubilier & Rice in 2021 as part of a combination with Fort Dearborn Company. CD&R may be trying to rationalise MCC, offloading parts of the business that are not core to its strategy. The performance of System Label appears to have slumped over the past number of years. From FY18 to the latest accounts in FY19, turnover fell from c. €5.4m to €3.9m and EBITDA fell from c. €1.1m to c. €0.5m. Beirne and Trimble should be well positioned to help return System Label back to its former strength in Ireland.
Source: Press Release
Deal Details: William Lyons has been acquired by Aston Lark for an undisclosed amount. The acquisition is subject to regulatory approval.
William Lyons is a Kerry-based insurance brokerage established in 1952 by William and Mai Lyons. It is jointly owned by Denis and Mary Lyons. The business reported turnover of c. €0.6m which converted to an EBITDA of c. €0.06m.
Aston Lark is a UK-based insurance brokerage formed in 2018 with the merger of Aston Scott and Lark Group. In FY21, the business reported turnover of c. £157.6m.
Renatus Comment: Aston Lark Ireland continues to be an active acquirer in the insurance brokerage space. This deal marks Aston Lark’s 13th acquisition over the past year and a half. This deal will include the acquisition of JC Daly Insurances, a Limerick-based William Lyons subsidiary, and will widen Aston Mark’s Irish footprint being its first presence in Kerry and Limerick. We expect to see further consolidation plays from Aston Lark in the near future.
Source: Aston Lark Press Release
Deal Details: Granite Digital has acquired Continuum. Deal consideration has not been disclosed.
Granite Digital is an Irish digital agency that offers solutions such as strategy, web design, web development, digital marketing, search engine optimisation and “pay-per-click” advertising consultancy. The business is headquartered in Cork and has offices in Dublin and Galway. It was founded in 2009 by Seamus White, Rob Carpenter and Ger O’Shea. The business does not report turnover or EBITDA information and was owned by various individuals including the founding team, Sean Byrne, Conor Buckley, Alf Smiddy, Cormac O’Neill and Gary Corcoran.
Continuum is a full-service digital agency focused on the delivery of intelligent creative online solutions. The business is headquartered in Dublin and has an office in New York. The business was founded in 2011 by Colin Meagle who had full ownership of the business prior to the acquisition. It does not report turnover or EBITDA information.
Legal: Regan Wall team led by Kieran Regan, and Sarah Connolly.
Renatus Comment: eCommerce-focused businesses benefited from a significant market size expansion during the pandemic. While this shift to digital was not as dramatic as the likes of Meta foresaw, with this being one of the primary explanations for the job losses this week, the shift has still been sizeable and appears to be here to stay. This acquisition will allow Granite to leverage a broader spectrum of capabilities and take advantage of this shift in behaviour. Granite has grown organically and through acquisition in recent years, purchasing Willows Consulting early this year and eleven other providers of digital services, including Connector and Webtrade. Granite has positioned itself as a market leader in the industry, having placed in Deloitte’s Fast 50 for four consecutive years until 2019, and Continuum will further strengthen its position.
Source: Irish Times
Deal Details: Deal Details: The owners of Il Valentino Bakery, Ken and Graham McDonnell, have acquired Queen of Tarts.
Queen of Tarts is a well-known patisserie and cafe on Cow’s Lane in Temple Bar. It was established in 1998 by Regina and Yvonne Fallon. The business does not report turnover or EBITDA information.
Il Valentino Bakery and Cafe is located at Grand Canal Dock. It is owned by Ken and Graham McDonnell and does not report turnover or EBITDA information.
Renatus Comment: Over the coming months, there will likely be consolidation in the retail and hospitality space, particularly in the city centre of Dublin. There are some heavy balance sheets coming out of Covid, where Covid-type debt was added onto existing debt. City centre activity has not fully reverted to normality with the work-from-home structural change driving footfall variations. This, compounded with energy price increases and general inflation, will likely drive significant consolidation as opportunities present themselves.
Source: Irish Times
Deal Details: Following approval by the CCPC in July, Permanent TSB has completed the acquisition of Ulster Bank’s performing non-tracker residential mortgage business. The portfolio comprises loans with a value of €6.2bn with €5.2bn being migrated today. The remaining €1bn is expected to be transferred by Q4 2023. The acquisition will increase the size of PTSB’s mortgage book by around 40%.
Source: Irish Independent
Deal Details: The state has sold 5% of AIB to institutional investors reducing its shareholding to 57%. The government’s shareholding stood at 71% at the beginning of the year; however, it is gradually selling down its stake acquired during the financial crisis through a share trading plan.
Source: Capital IQ
Based in Cork, with four locations, McDonnell Bros. is one of Munster’s biggest independent Agri suppliers with a base of over 3000 farmer customers. The business was founded in 1977 by Denis & John McDonnell. The business offers feed, fertilizer, agri hardware, chemicals, seeds, farm plastics, minerals, grain and services.
McDonnell Bros reported FY21 turnover of c. €38.8m which converted to an EBITDA of c. €3.1m, representing a year-on-year increase of 17.0% and 61.2%, respectively. This improved EBITDA margin was primarily enabled by gross margin increasing from 16.0% in FY20 to 17.8% this year.
Significant post-EBITDA cash movements included a working capital investment of c. €1.8m and the purchase of tangible fixed assets amounting to c. €0.8m. The business closed FY21 with a net cash balance of c. €3.8m, a c. €250k increase on FY20. The business is owned by founders Denis & John McDonnell.
Glanmire Supermarkets Limited (trading as Ryan’s SuperValu), is a supermarket in Glanmire, Co. Cork. It is majority owned by William and Diane Ryan.
In its financial year to December 2021, the business generated a turnover of c. €33.4m, an increase of 1.9% year-on-year. This converted to c. €2.3m EBITDA, an increase of 8.7%. EBITDA growth can predominantly be attributed to the increasing revenue figure, with adminstrative expenses falling year-on-year.
The business finished the year with a cash balance of c. €3.5m, a c. €0.3m increase on FY20. Significant post-EBITDA cash movements included an investment in working capital and payments to acquire property, plant and equipment.
The business employed an average of 176 people during the year at a total cost of c. €3.4m.
Who: CV6 Therapeutics, a Belfast-based drug development company focused on the discovery, development and commercialisation of novel therapies for the treatment of human diseases.
What: The business raised a reported c. £8m, including £3 million from Invest NI and the remainder from firms including Qubis, Techstart and Clarendon.
Why: The funding will go toward funding clinical trials to further develop its first anti-cancer drug and to add four new cancer research jobs to the company.
Source: CV6 Therapeutics Press Release
Who: Angoka, a Belfast-based Internet of Things security company that focuses on protecting M2M communications for smart cities and mobility.
What: The business has completed a reported c. £2.4m funding round led by 24Haymarket, which included Gallos and Co-Investment Fund (NI) through Clarendon Fund Managers.
Why: Angoka will use the investment to fuel international growth plans, accelerate the design and delivery of cybersecurity programmes, and develop its team.
Source: Irish News
Who: Stride, a new syndicate platform for buying and selling shares in elite-level racehorses..
What: The business has raised a reported €600,000 and plans to raise a further €1.2m early next year.
Why: The funding will be used to grow its headcount and launch in America.
Advisers: Legal: Holmes led by Shane Costelloe, Donal Browne, and Johne Murphy.
Source: Business Post
Who: Sonrai Analytics, a Belfast-based AI data discovery company that is uniquely positioned to support biotech and pharma in the search for new development and better research.
What: The company has secured an undisclosed amount of funding from US venture capital investor Eckuity.
Why: The investment from Eckuity will create value and accelerate success with its expertise in early-stage life sciences, healthcare and tech companies.
Source: Sonrai Analytics Press Release
Who: UrbanFox, a Dublin-based anti-fraud technology business.
What: The company has raised a reported €3.5m in funding, with Jetblue Airways among the investors.
Why: The investment will help UrbanFox grow its team and reach more customers in the travel and retail sectors.
Source: Business Post
Who: Budibase, a Belfast-based software business that has developed an open source low-code platform for building internal applications in minutes.
What: The company has secured a reported $7m (€7.04m) in funding from SignalFire, a San-Francisco-based venture capital firm.
Why: The funding will be used to help build a healthy and sustainable business for Budibase.
Source: Business Post
We in Renatus believe that more important than the deals are the people and we are pleased to provide you with details of key recent executive and board-level appointments.
The value of Irish agri-food exports in 2021. This is a 51% increase since 2012. Dairy exports are the most significant contributor exceeding €5bn for the third year in a row. According to @agriculture_ie
The annual rise in Irish wage rates in October. This is almost twice the pre-pandemic rate of increase. The increase is mainly attributable to higher costs of living and staff shortages in several sectors. According to @centralbank_ie
The increase in customer shopping in discount stores in October 2022 compared to the same month last year. According to @RevolutApp
The increase in the Consumer Price Index in October 2022 compared to a year earlier. This is the highest rate of price inflation since June 1984 and is the thirteenth straight month where the annual increase in CPI was at least 5%. According to @CSO_Ireland
The average rate on new mortgages in September. This is down 0.06% on August 2022 and 0.14% on September 2021. Irish mortgages are now no longer the most expensive in the euro area but are still above the average. According to @centralbank_ie
The increase in value of personal loans drawn down from Irish banks in Q3 2022 compared to Q3 2021, with 47,094 loans valued at a total of €442m. The fastest-growing sector includes loans for education, holidays and special occasions such as weddings. @BPFINews
The increase in the cost of fertiliser over the last twelve months to September. This contributed to a 37% rise in the overall cost of agricultural inputs during the same period. According to @CSO_Ireland
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