Renatus Weekly M&A & Company Performance Private Equity Newsletter 15/08/2021

Deal Details: We are delighted to announce that Renatus Capital Partners, backed by a collection of successful Irish business people and the Irish Strategic Investment fund, is now an investor and partner in the Allied Imports Group. The aim of the partnership is to support Allied Imports’ exciting and pioneering future growth plans across Ireland, UK and Europe.

The Allied Imports Group, owners of the Tipperary Crystal brand, is recognised as the leading Giftware, Jewellery, Homewares and Christmas product provider in Ireland. The Company`s plans include the further development of its “House of Brands” to include internationally recognised Designers such as Orla Kiely, Eoin O’Connor and the recently signed Graham Knuttel. In line with the Company`s growth strategy, the team at Allied Imports has now developed a whole series of New Collections across the brand`s portfolio for launch in 2022. Pioneering product development, innovative design and extensive Marketing Campaigns are at the core of the Company’s success and with the investment from Renatus, the Allied Imports Group look forward to rolling out this successful strategy across Ireland, UK and Europe.

Allied Imports Directors Robbie Scanlan and Stephen Scanlan will continue to lead the business. John Herlihy who rose to the very top of both Linkedin and Google internationally is co-investing with Renatus and will join the advisory board. Paul Duffy who has returned to Ireland from the US having served as Chairman and CEO of Pernod Ricard North America will also co-invest into the business and its advisory board.

Robbie Scanlan – Managing Director, Allied Imports Group stated: “We have found an excellent partner with Renatus and its co-investors and this partnership will allow us to fulfil our growth strategy in the coming years, Renatus bring on board best in class expertise across multiple fields and this will facilitate us in jointly creating one of the great Irish corporate success stories”.

Advisers: Conor Mehigan and Kyle Barry led the deal execution for Renatus.

Renatus Advisors:
Holmes (legal): George Kennedy, Ciara Downes, Shane Costelloe and Linda McAuliffe.

KPMG (tax): Mike Hayes, Sinead Kelly, Aoife Kennedy and Holly Minihan.

Allied Imports Advisors:
Wallace Corporate Counsel (legal): Patrick O’Shea and Sean Burke

Twomey Moran (tax): Paul Morris, Michael O’Brien and David Moran

Renatus Comment: This is Renatus’ sixth investment and the third from its new €40m fund. Renatus is a boutique, impact-driven private equity fund focused on providing supportive equity capital (minority and majority) to ambitious SMEs across Ireland and the UK.

Allied Imports’ talented and ambitious management team has positioned the business to be a global market leader. Renatus is excited to partner with the Allied Imports team and provides the support to help the business accelerate its growth plans.

This was an enjoyable deal to be involved in and we would like to thank all those involved, in particular the aforementioned advisers.

For all your personal and corporate gifting, check out Tipperary Crystal’s website here.

Source: Renatus

Deal Details: Ritchie Bros has acquired Northern Ireland-based Euro Auctions for a reported consideration of $1.1 billion (€850 million).

Euro Auctions was founded in Dromore, Co Tyrone, in 1998 by Derek Keys and other members of the Dromore family. The company, with more than 200 staff across 14 countries, buys and sells industrial plant, construction equipment and agricultural machinery all over the world.

Canadian acquirer Ritchie Bros is as a global asset management, disposition, and services company which, similar to Euro Auctions, sells items through a timed auction format.

Advisers: KPMG Ireland advised Richie Bros, providing financial and tax due diligence on this transaction.

Renatus Comment: Ritchie Bros looks to be global leader in the equipment auctioneering space, and was a natural buyer for a company the size of Euro Auctions. The markets certainly welcomed the news, with Ritchie’s share price up more than 5% after the announcement. Sitting as the auction house in the middle is a resilient space, with business buying and expanding their equipment fleets when growth is on, and selling and winding down their fleet when growth is off. Either way the auction house benefits.

Source: BBC

Deal Details: BHP Insurance, an independent Irish brokerage specialising in the not-for-profit sector, has acquired Keegan Meredith & Williams Insurances (KMW). KMW is a commercial insurance brokerage based in Sandyford, Dublin.

The acquisition has been completed following a significant investment in BHP Insurance by Irish private equity firm Melior Equity Partners. This deal sees alternative debt provider Duke Royalty exiting its investment in the business.

Advisers: Clearwater International’s John Curtin, John Sheridan and Daniel Lavelle provided transaction support to Melior Equity Partners. Legal advice was received from William Fry’s Stephen Keogh and Ronan Shanahan. KPMG provided financial and tax advice to Melior.

Renatus Comment: Consolidation in the insurance sector in Ireland continues, with a new private equity investor entering the sector. This is Melior’s first investment since the team spun out of Carlyle. The Melior team brings experience and a track record in the sector having previously acquired AA Insurance in 2016 through the Carlyle Cardinal Ireland fund.

Source: Irish Independent

Deal Details: Lonsdale Capital Partners has completed the sale of Cross Rental Services to Elysian Capital LLP and Company Management.

Cross Rental Services is a market leading provider of refrigeration & catering and climate control rental equipment to customers across a diverse range of end markets, including retail, manufacturing and facilities management. It was established in 2006 and has operations across Ireland and the UK, with its headquarters in Dublin.

Advisers: Lonsdale and the founding shareholders were advised by Houlihan Lokey, Burness Paull and Ronan Daly Jermyn.

Cross Rental Services management team was advised by Liberty Corporate Finance, Arthur Cox (legal) and Deloitte (tax). Commercial due diligence was provided by LEK Consulting with financial and tax due diligence by Deloitte.

Renatus Comment: Since starting its partnership with private equity firm Lonsdale in 2018, Cross Rental Services has completed two bolt-on acquisitions in the UK market (one in 2019 and one in 2020), in addition to achieving significant organic growth. This resulted in a revenue annual growth of c. 31% between 2018 and 2021, which we are sure delivered a fantastic exit result for all shareholders.

Source: Lonsdale Press Release

Deal Details: Cool Planet Group, the transport and energy group led by Irish entrepreneur Norman Crowley, has acquired Northern Ireland’s PowerHouse Generation for an undisclosed sum.

Founded in 2010, the Wicklow-based Cool Planet Group has a diverse group of business including energy consumption consultancy business Crowley Carbon, an interaction climate action visitor experience at Powerscourt Estate, and business that upgrades classic cars into electric vehicles, among other businesses.

Antrim-based Powerhouse Generation was founded in 2013 as a demand response unit aggregator operating within Ireland’s electricity market, and has since added DS3 trading and consultancy services to its offering.

Advisers: PowerHouse: HNH, led by Richard Moorehead, acted as Lead Corporate Finance Advisors. Tughans, led by James Donnelly, acted as legal advisors.

Cool Planet Group: Arthur Cox led by Michael Coyle (Corporate and M&A) and included Sarah McDermott, Emma O’Keeffe, Lynsey Mallon, Maeve Williams, Ian Duffy, Alison Peate, Alex McLean and Fiona Egan, acted as legal advisors.

Renatus Comment: : It is reported that under the acquisition, PowerHouse will join Cool Planet Group’s energy services subsidiary Crowley Carbon, growing Cool Planet’s energy-saving consultancy operations. Highlighting the activity in the wider space, this is the third deal in this week’s newsletter that falls under the ESG theme.

Source: HNH,The Times

Deal Details: Glanbia has acquired a 60% share in German-based LevlUp for an initial consideration of €31.4m, with an option to buy the business outright from 2025.

The German firm, which was established in 2018, has developed energy booster drinks it claims are especially tailored for video-gamers. LevlUp’s consumer base is largely in Germany with a growing presence in adjacent European markets.

Advisers: None mentioned.

Renatus Comment: Glanbia released its results for the first half of the year this week, and reported group profits up almost 91% vs the prior year as it bounced back from a pandemic slump. It’s share price has also recovered and is up c. 50% since this time last year and is trading at c. 15x Enterprise Value to FY Dec 21 expected EBITDA.

Source: Glanbia

Deal Details: International food group Valeo Foods has agreed to acquire New World Foods Europe (NWFE), a producer of meat snacks in the UK, from Australian FMCG entrepreneur Tony Quinn.

Dublin-headquartered Valeo, which was formed in 2010 through the merger of Origin Foods and Batchelors, is the company behind household brands such as Jacobs and Odlums.

New World Foods Europe, a producer of branded jerky and biltong meat snacks, employs 120 people at its main operations in York and Forres.

Advisers: None mentioned.

Renatus Comment: This is Valeo’s first acquisition since it recently announced its own sale from CapVest to Bain Capital Private Equity in a deal which is due to close in the coming weeks. It marks the group’s 19th acquisition since it was founded just over a decade ago. Seamus Kearney, Group CEO, Valeo Foods, said New World Foods’ portfolio will expand the group’s reach into on-trend protein snacks and provide an opportunity to further develop the meat snacks category.

Source: Irish Independent

Deal Details: Accuvio has been acquired by US multinational Diligent Corporations for an undisclosed sum.

Founded in 2009 by Adrian Fleming, Roy Meaney and Derek Spillane as ManageCO2, Accuvio has developed an environmental, social and governance (ESG) data aggregation and reporting software platform which enables large organisations to collate information about their impact on the environment.

New York-headquartered Diligent is a leading GRC SaaS provider, serving nearly 1 million users from 25,000 organisations globally. The company enables board members of corporations, government organisations and not-for-profit groups to share and collaborate information for board meetings.

Advisers: A ReganWall team led by Adrian Wall (Partner), along with Sean Daly (Associate) and Neil Nolan (Associate), advised the sellers. Financial advice was provided by Derek Murphy at Deloitte.

Diligent was represented by Willkie Farr Gallagher NY and Mason Hayes & Curran in Ireland (Martin Kelleher and his team).

Renatus Comment: ESG analysis and reporting has become big business in recent years with Research and Markets forecasting it will triple in value to $1.5 billion (€1.27 billion) by 2028. With the deal, Accuvio will form part of Diligent’s wider ESG offering and it will give Accuvio access to a much wider potential customer base.

Source: Accuvio

Deal Details: Octopus Renewables has taken a reported 24% stake in Simply Blue Group with a €15 million investment.

With its headquarters in Cork, Simply Blue is a marine project developer focused on floating wind initiatives across Ireland and Britain.

Octopus Renewables, which is part of the UK’s Octopus Group, is one of the largest owners and managers of renewable energy assets in Europe. It manages more than £3.4 billion of assets on behalf of investors with 2.8GW of total portfolio capacity.

Advisers: Simply Blue was advised by Fieldfisher. The team was led by Feilim O’Caoimh and was supported on the transaction by Jamie Woodcock, Teodora Puiu, Barry Walsh, Julie Austin and Breen Purcell.

Renatus Comment: This looks like a smart vertical integration play for Octopus Renewables. Ireland’s potential for offshore is huge – our available wind coverage is ~10x our  landmass and off the west coast we some of the highest average wind speeds in Europe. The need to bring on more offshore wind has been enshrined in the Government’s Climate Action plan and the deliver the legislated targets much more investment is needed in the space. We expect to report a lot more deals in on this topic over the coming years.

Source: Irish Times

Deal Details: Engineering company CJK has acquired McGrattan & Kenny and will form a new mechanical and electrical services group. Both businesses will continue to operate as separate firms within the shared group structure.

The deal will lead to 100 new jobs being created to bring group headcount to 360 people by 2024. No financial consideration was disclosed.

Advisers: None mentioned.

Renatus Comment: Founded in 1998 and currently employing 220 employees, CJK’s clients include Accenture, DCU, Egis (Dublin Port Tunnel), ESB, Facebook, the HSE, Irish Distillers and RTÉ. Established in 1968, Dublin-based McGrattan & Kenny has 40 staff.

Source: RTE, Irish Times

Deal Details: Dublin-based Keywords Studios, a video game services company, has acquired AMC for a reported total consideration of €2.8m.

Romnaian-based AMC works for large publishers and developers including Activision, Wargaming, Zynga and others on franchises including Call of Duty, World of Tanks, Spider Man, and Planet of the Apes.

Advisers: None mentioned.

Renatus Comment: A regular in our weekly newsletter, this marks Keywords’ third acquisition this year.

The acquisition furthers Keywords’ strategy to become the ‘go-to’ technical and creative services platform for the global video games industry, adding significant talent and experience to Keywords’ art service line and establishing its presence in Eastern Europe.

Last year AMC recorded revenue and adjusted EBITDA of €2.3m and €500k respectively.

Source: Keywords, Irish Independent

Deal Details: Energy Services and Straightline Energy Solutions have merged to form Action Zero, in a move that is expected to lead to the creation of 80 new jobs.

Energy Services was established as a power and energy consultancy 28 years ago by Cork businessman Tom Lynch and has operated in over 16 countries. Killarney-based Straightline Energy Solutions was founded in 2013 and is led by John O’Leary.

The newly formed entity is behind a patented turnkey technology called the ‘EscoPod’ which generates heat in a process that eliminates the need for fossil fuel. The technology is integrated with an analytics platform that uses data to optimise efficiency and report on the transition to green, renewable energy.

Advisers: None mentioned.

Renatus Comment: The fourth climate change themed deal this week. There’s a significant global market opportunity as the world continues to push towards a zero-emissions future. This deal has Pearse Flynn coming in as a backer and is one of a suite of green-energy companies in which the businessman has a major interest.

Denis Collins, a former global executive with IBM, and previous chairman of IDA Ireland Regional Development, is to lead ActionZero as CEO following the merger.

Source: Irish Times

Deal Details: Alliance Automotive Group UK (AAG) has acquired Dublin-based J&S Automotive Distributors (J&S) for an undisclosed sum.

AAG is a leading distributor of passenger and commercial vehicle parts to the independent automotive aftermarket in Europe. It is owned by NYSE-listed Genuine Parts Company.

J&S Automotive Distributors is a specialist aftermarket auto parts distributor. The business was founded in 1977 by Joe Gaynor and is today led by his son Alan Gaynor.

Advisers: Philip Lee provided Irish law advice to Alliance Automotive Group UK (AAG) on its acquisition of Dublin-based J&S Automotive Distributors.

The cross-border transaction involved working closely with Multilaw firms Penningtons Manches Cooper LLP and Millar McCall Wylie Solicitors.

Renatus Comment: For AAG, the transaction represents the first step in building a distribution infrastructure in the Irish market to match its UK infrastructure. It also enables J&S to enter the next chapter in its long history and gives the business access to the global purchasing footprint of AAG’s parent company, US-based Genuine Parts Company.

Source: Philip Lee