Renatus is now hiring for two positions; Finance Director and Office Manager. Also, catch up with multiple M&A deals in our latest weekly newsletter.
Renatus Weekly M&A & Company Performance Private Equity Newsletter 22/01/2023
Please find below this week’s newsletter covering the latest M&A, company performance, fundraisings and executive moves.
THOUGHT FOR THE WEEK
When out and about, we always ask people for their thoughts on the most impressive CEOs and business leaders that they have come across. Invariably, Michael O’Leary is the name that comes first off people’s tongues.
He recently obliged Nicolai Tangen of Norges Investment bank with a podcast appearance. It’s unusual to hear him speak in such depth and is well worth a listen. (Link below).
In the podcast he stresses the importance of building up cash reserves and not over-extending during good times in order to have the flexibility and resources needed to be bold in times of crisis. As Warren Buffett famously stated ‘be fearful when others are greedy, and greedy when others are fearful.’ In reality, it is very difficult to execute this in times of panic. In fairness to O’Leary he has lived by this philosophy throughout his career to great effect and is well deserving of his many plaudits.
Renatus is now hiring for two positions; Finance Director and Office Manager.
To date we have partnered with 9 ambitious portfolio companies to help them realise their potential. Our small team means that all team members play an integral role in Renatus’ activities. This is an exciting time to join in on the Renatus journey as we look to increase our portfolio by continuing to back ambitious management teams and companies.
If you, or someone you know, is interested in applying, please visit the below Linkedin postings:
Deal Details: Sports Surgery Clinic Santry has been acquired by UPMC. Deal consideration has not been disclosed and the deal is subject to approval by the CCPC.
Sports Surgery Clinic is a 101-bed private sports clinic in Santry, Co. Dublin. It was established in 2007 by surgeon Ray Moran with financial backing from several other surgeons and private investors including his brother Kevin Moran who is a former Man Utd. footballer. In FY Dec 21, it reported turnover of c. €59.1m which converted to EBITDA of c. €11.3m. In 2019 it received private equity investment from Carlyle Cardinal Ireland.
University of Pittsburgh Medical Centre (UPMC) is a $24bn not-for-profit healthcare operator based in Pittsburgh, USA. It has 92,000 staff members. Its Irish operation is led by David Beirne.
Advisers: UPMC: CF: TowerView team of Diarmuid McNamee, Daire Gilmore, Philip O’Donnell, Jamie McAleese. Legal: DLA team of David Carthy, Steven Duggan, Jack Jelly.
SSC: Legal Advisors: Matheson led by George Brady.
Renatus Comment: The Sports Surgery Clinic’s rapid growth has seen it become the largest orthopaedic surgery and specialist sports medicine hospital in Europe. Last year it submitted a planning application to build a four-storey, 11,000 sqm extension to cater for future demand. This will be the fourth hospital operated by UPMC in Ireland, following its acquisition of facilities in Waterford, Kilkenny and Clane. It also operates two radiotherapy centres, three sports medicine clinics and several outpatient facilities in Ireland.
The Private Hospitals Association comprises of 18 hospitals throughout Ireland which includes the Beacon Hospital (Denis O’Brien), Blackrock Clinic (Larry Goodman) and the Mater Hospital (InfraVia Capital Partner). Given the current strain on the public system, these Hospitals are likely to remain prized assets for the foreseeable future.
Version 1 acquires Automation Logic and Qubix
Deal Details: Version 1 has acquired Automation Logic and Qubix for an undisclosed amount.
Version 1 is a Dublin-based provider of IT services and solutions. In FY21, the business reported turnover of c. €190.2m which converted to an EBITDA of c. €32.7m.
Automation Logic is a UK-based IT consultancy business. The business was principally owned by Kristian Saxton and Norm Russell and reported FY Dec 21 turnover of c. £14.2m which converted to an EBITDA of c. £2.3m.
Qubix is a UK-based global Oracle Platinum partner. It was owned by Robert Lutener. The business did not report turnover or EBITDA information.
Advisers: Version1: Legal: Maples led by Paddy Quinlan, Jordan O’Brien, William Darmody, Shane Divilly, Claire Morrissey, Lynn Cramer.
Qubix: Corporate FInance: Clearwater International TMT (London).
Automation Logic: None Mentioned.
Renatus Comment: The Partners Group acquisition of a majority stake in Version 1 in April last year reportedly valued the business at c. €800m. The new ownership have continued Version 1’s active acquisition strategy, acquiring Instinctive BI in October last year. These two deals will further strengthen the company’s presence in the UK public and commercial sectors and will bring the total number of acquisitions completed by the company to 16.
Source: Irish Times
First Ireland Risk Management acquired by Gallagher
Deal Details: First Ireland Risk Management has been acquired by US insurance broker Gallagher for an undisclosed amount.
First Ireland is a Dublin-based insurance brokerage that employs c. 130 people. The business is owned by Anthony Gill, John Roe, Linda Gallagher, Sarah Sheridan, Conor Lyons and Cathal Duffy. In FY 21, the business reported turnover of c. €12.5m which converted to an EBITDA of c. €2.2m.
Gallagher provides insurance brokerage, consulting, third-party claims settlement, and administration services. In FY21, the business reported turnover of c. $6.7bn which converted to an EBITDA of c. $1.6bn.
Advisers: First Ireland Risk Management: Deal Advisory: Deloitte led by Jan Fitzell, James Toomey, Ross O’Riordan, Philippa Reynolds, Dylan Gibbons and Caoimhe McLoughlin. VDD & Tax: Mazars team which included Mark Mulcahy, Anthony Shiel, Michael Smollen, Kevin Hogan, Gerry Vahey and Nicole Hanlon. Legal: Wallace Corporate Council led by Gar Smyth and Sean Hiney.
Gallagher: None mentioned.
Renatus Comment: Gallagher is embarking on a journey of consolidation in Ireland. It entered the Irish market with the acquisition of Innovu in June 2022 and followed that with a deal to acquire Wexford-based Doyle Mahon Insurances in November. Ronan Foley, chief executive of Gallagher, has reported that the First Ireland acquisition will double Gallagher’s gross written premiums in Ireland from c. €70m to c. €140m.
Statkraft sells 50% stake in Irish offshore wind farms to Copenhagen Infrastructure Partners
Deal Details: Statkraft has sold a 50% stake in the North Irish Sea Array (NISA) off the coast of counties Dublin, Louth and Meath as well as the Bore Array in the Celtic Sea.
Statkraft is a renewable energy company owned by the Norwegian government. It is Europe’s largest generator of renewable energy. In FY 21 it reported turnover of c. €8.0bn which converted to EBITDA of c. €3.0bn.
Copenhagen Infrastructure Partners is a Danish fund management company specialising in global investments in energy infrastructure assets. It has raised c. €100bn to date which it manages across 10 funds.
Advisers: Statkraft: Legal: Pinsent Masons led by Oisín McLoughlin, Richard Murphy and Sarah Hope.
CIP: None mentioned.
Renatus Comment: Statkraft has become one of the largest off-shore wind players in Ireland since it began operations here in 2018. This marks CIP’s first entry into the Irish off-shore wind market. According to a Baringa report this week, 34% of Ireland’s energy in 2022 was generated by wind, up 4% on 2021. It is likely we will continue to see deals between large international energy companies for off-shore Irish wind farm assets, given the government’s target of having 7GW of offshore wind assets installed by 2030.
Source: Pinsent Masons Press Release
Erisbeg acquires majority stake in ORS
Deal Details: ORS has received investment from Erisbeg. Deal consideration was not disclosed.
ORS is a multidisciplinary engineering & building consultancy business, based in Mullingar, Co. Westmeath. It was established by Paul O’Reilly and Finbarr Stuart in 1991 and is now led by managing director John Brennan. The business does not report turnover or EBITDA information.
Erisbeg is an Irish private equity firm established by Alan Kerr and Thomas Davy in 2017. It is currently investing out of a €110m fund.
Advisers: Erisbeg: Legal: LK Shields led by Lester Sosa-Villatoro and Emmet Scully. Tax: EY led by John Kennelly. Transaction services: Deloitte led by Conor Cullen.
ORS: Deal Advisory: Focus Capital led by Barry Madden and Alan Kelly
Renatus Comment: Engineering and construction consultancies have experienced a significant rebound in activity over the past 12-18 months following on from Covid-related disruptions, with Construction Network Ireland (CNI) estimating that the construction industry grew by 10.6% in 2022 on the previous year. However, the level of activity was still down on 2019 levels. CNI stated that the industry will surpass pre-pandemic levels this year, aided by continued government investment under the National Development Plan 2021-30. ORS should stand to benefit from increased activity and is upscaling to meet demand by opening its 7th office in Cork and adding c.150 people to its workforce over the next three years.
Source: Business Plus
DEAL UPDATES & OTHER NEWS
Power Capital Renewable Energy secures €240m funding
Deal Details: Power Capital Renewable Energy (PCRE), an Irish solar farm developer, has secured up to €240m in finance, from a consortium of lenders led by Eiffel Investment Group. A portion of the money will be utilised to build assets through Power Purchase Agreements (PPAs) with Microsoft and an undisclosed technology firm. Following the initial €100m tranche, PCRE stated that an additional €40 million may be made available for international expansion, plus €100m to acquire additional assets.
Advisors: Power Capital: Legal: Philip Lee (Eoghan Doyle and George Kennedy) and Arthur Cox. Debt advisory: Afiereos Capital
Altada acquired out of receivership by Eoin Goulding
Deal Details: Altada Technology Solutions has been acquired out of receivership by Eoin Goulding through his company Cometgaze. Last week the receiver appointed to sell the business reportedly accepted a bid from Datech led by Jeffrey Leo but this ultimately fell through as the court was told that it would not have been acceptable to the employees of the company. Cometgaze made an offer of €2.5m which has ultimately been successful.
Source: Business Post
Morgan Fuels Ireland Limited is a provider of fuel card services, bulk fuels, lubricants and capital equipment to commercial, agricultural, retail and domestic customers throughout Ireland and the UK. It is based in Dundalk, Co. Louth. It was established in 1981 by Hugh Morgan who remains the largest shareholder alongside Briege Doran and Louise, Michael & Laura Morgan.
In its financial year to March 2022 the business generated turnover of c. €206.9m, an increase of 51.6% year-on-year. This converted to c. €1.0m EBITDA, an increase of 63.3%. The increase in EBITDA was driven by revenue growth.
The business finished the year with a cash balance of c. €0.1m. The primary cash outflow related to the purchase of tangible fixed assets.
The business employed a total of 73 people during the period at a total cost of c. €2.7m.
Gortavoy Feeds & Farm Supplies Ltd was founded in 1982 as a family-run business that supplies the agricultural sector with feed for beef, dairy, sheep, and pigs. The business is based in Tyrone and its owners include Barbara and William Gilkinson.
In its financial year to March 2022, the business generated a turnover of c. £33.3m, an increase of 17.8% year-on-year. This converted to an EBITDA of c. £2.1m, an increase of 12.3% year-on-year.
The business finished the year with a cash balance of c. £2.7m. Significant post-EBITDA cash movements included the purchase of tangible fixed assets and capital repayments.
The business employed an average of 34 people in FY21 at a total cost of c. £1.3m.
Who: AIB, one of Ireland’s remaining pillar banks.
What: The bank raised €750m at a 5.75% coupon rate on the bond market through ‘social’ bonds from 240 investors across 21 countries. Last March it raised €1bn through the issuance of a similar bond.
Why: The funds will be used to lend to projects in the education, healthcare and social & affordable housing sectors in socio-economically disadvantaged areas in Ireland.
Who: Syky, a Web3 luxury fashion platform founded by Alice Delahunt.
What: The business has raised $9.5m in a funding round led by Reddit co-founder Alexis Ohanian’s Seven Seven Six fund alongside Brevan Howard Digital, Leadout Capital, First Light Capital Group, and Polygon Ventures.
Why: Syky is developing a blockchain social/ marketplace platform for fashion designers and consumers. It also announced the release of its NFT named ‘The Keystone’ which functions as a membership pass for digital and physical fashion events
Who: Inclusio, an AI-enabled startup that aims to benchmark companies on diversity and inclusion initiatives.
What: The company has raised €1.9 million from Irish venture capital investment funds including Elkstone Partners, Atlantic Bridge, and Bill McCabe’s Oyster Capital.
Why: The business has partnered with 35 firms to conduct industry research into how best to manage diversity and inclusion in the workplace.
Advisors: Wallace Corporate Counsel led by Alan Ryan and Graham Coyne
Source: Business Post
Who: Plasmabound, a developer of bonding technology for lightweight composite materials.
What: The company has raised €750k from Business Venture Partners.
Why: The funds will help scale the adaption of CPA technology in manufacturing processes throughout various sectors.
Source: Business Plus
EXECUTIVE AND BOARD APPOINTMENTS
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.