Please find below this week’s newsletter covering the latest M&A, company performance, fundraisings and executive moves.
Deal Details: Irish bedding manufacturer Kayfoam Woolfson has been sold by Irish private equity firm FL Partners to Leggett & Platt Inc, a large US multinational (NYSE: LEG). The deal is reported to have been worth more than €100m.
Kayfoam Woolfson owns bedding brands King Koil, Kaymed and Odearest and was acquired by FL Partners in 2007 in a deal reportedly worth around €60m. Kayfoam employs more than 300 people, with plants in Dublin and Kilcullen, Co Kildare.
Leggett & Platt, founded in 1883, is based in Missouri and employs more than 20,000 people.
The most recent published accounts for Kayfoam Woolfson Unlimited Company to September 2019 show revenue of €60m and EBITDA in excess of €10m.
Mark McEnroe and Laura Kilbride of PwC Corporate finance advised the Vendors and Paul O’Connor prepared the Vendor Due Diligence;
Rob Dickson, Ron Boucher and Niamh Callaghan of Mason Hayes Curran advised on legals.
Legget & Platt:
Arthur Cox team led by Brian O’Gorman advised on Legals;
Patrick Dillon & Tom Roche Grant Thornton acted as buyside advisers.
Renatus Comment: FL Partners acquired the company in 2007 from the Woolfson family, a year before the financial crisis in 2008. After a number of years of difficult economic conditions post acquisition, the business stabilised and went onto thrive under CEO David Moffitt and John Sexton Finance Director, who had previously worked alongside the founding Woolfson family.
FL Partners was founded in 2006 and has enjoyed great success investing in various businesses with this, the Racing Post, UTV, ATA, Sunseeker and more recently residential property deals in Ireland the UK and US.
Source: Irish Times
Cork-headquartred Everseen, founded in 2007 by Alan Herlihy, is a specialist in AI-powered computer vision software.
From its headquarters in Blackpool, Cork and through research centres in Romania and Serbia, Everseen has developed video-camera technology that monitors self-service checkouts for items that were not scanned, thus reducing errors and thefts. Such errors and thefts cost retailers up to €40bn each year.
Advisers: Martin Higgins of Focus Capital Partners, the corporate finance advisor to Everseen since 2016, advised Everseen on this transaction.
Renatus Comment: Last year, Everseen raised investment from a range of private individuals which reportedly valued the company at that time in excess of €100m. The technology has achieved critical mass in the Retail sector across processes such as self-checkout and inventory management. Everseen are in 14 of the top 25 global retailers, according to an interview given by CEO, Alan O’Herlihy.
Source: PR Newswire
Deal Details: Grafton Group is to establish a presence in Finland via the acquisition of Isojoen Konehalli Oy and Jokapaikka Oy (IKH) for a reported €199.3m in an all-cash deal.
IKH is one of the largest workwear and personal protective equipment, tools, spare parts and technical accessories wholesalers and distributors in Finland. Founded in 1956, IKH currently employs around 400 people. It reported revenue of €158.8m and an adjusted operating profit of €21m for the year ended February 28th, 2021.
Advisers: None mentioned.
Renatus Comment: This is Grafton Group’s 5th acquisition since the beginning of the global pandemic and strengthens the groups operation in mainland Europe. Grafton Group owns such brands as Woodies, Chadwicks and Leyland. Grafton Group benefited significantly in the recent boom for home improvements. According to research commissioned by the Irish League of Credit Unions, Energia and House2Home, 56% of Irish households are considering home improvements due to more time spent at home due to the Covid-19 pandemic.
Source: Irish Times
US-based Niacet is a global market leader in technologies for preservation in its key market categories of Bakery, Meat and Pharma.
It is reported that for the year ended 31 Dec 2021 Niacet is expected to have pro forma annualised revenue of c.$220m and EBITDA of c.$66m, representing an EBITDA margin of c.30%.
Kerry Group is the world’s leading taste and nutrition partner for the food, beverage and pharmaceutical industries.
Advisers: None mentioned
Renatus Comment: Last week we reported Kerry’s sale of the meat business to Pilgrims for a reported €819m and Kerry were not long finding a use for these proceeds. The transaction value for Niacet reportedly represents an implied EV/EBITDA multiple of 15.4x excluding synergies for a 2021 pro forma EBITDA of around USD 66m. The reported value on the meat business was 8.5x 2021 EBITDA, which illustrates the premium attracted by specialist ingredient companies over consumer food brands.
Source: Kerry Group
Deal Details: Irish regulatory software company Vizor Software has been acquired by BearingPoint RegTech. Financial consideration was not disclosed.
Vizor, founded in 2000 by entrepreneurs Conor Crowley and Ross Kelly, is headquartered in Sandyford, Co Dublin and employs around 100 people.
BearingPoint RegTech, founded in Frankfurt over 25 years ago, was acquired by multinational consulting firm Nordic Capital late last year.
Together, RegTech and Vizor serve more than 7,000 firms including banks, insurance companies, and financial services providers with reporting solutions. At the same time, they enable more than 50 regulators and tax authorities to collect and analyze data from 34,000 firms in 60 countries.
Advisers: Novacies Capital led by Ciaran McGloin (M&A) and Eversheds Sutherland led by Enda Newton and Emer Shelly (Legal) acted for Vizor on this transaction.
Renatus Comment: In the year ending December 19, Vizor generated €13.5m of revenue. Vizor was chaired by Nigel Kelly.
According to a reported issued by the World Bank in late 2020, almost three-quarters of 118 authorities in 114 different jurisdictions said they had accelerated or introduced new initiatives on digital infrastructure, while 58 per cent said they had accelerated or introduced new measures to support “RegTech” and supervisory technology, or “SupTech”. Vizor is well placed to support these authorities in the fast changing fintech landscape.
Source: Vizor Software
Neueda, founded in 2002, is an award-winning technology partner to leading companies including J.P. Morgan, Citi, Liberty I.T., Credit Suisse, and Microsoft.
Version 1, established in Dublin in 1996, is rapidly growing IT Services provider delivering Digital, Cloud, Data and ERP Transformation services to commercial enterprises and public sector organisations.
Combined, the businesses will have almost 2,000 employees, more than 500 customers, and project revenue of €200m in the next year. Its operations are spread across Ireland, the UK, Spain, and India.
Advisers: Patrick Quinlan and the Irish corporate team at Maples Group supported Version 1 on the legal aspects of this transaction.
Renatus Comment: The purchase is the 12th acquisition for Version 1 to date. The Company’s last acquisition, Singlepoint, took place in March 2020. Version 1 already had a strong presence in Northern Ireland since establishing in Belfast in 2012. Last year Version 1 announced the establishment of a Digital Development Hub in Belfast and the creation of 70 specialist IT jobs.
Source: Version 1
Deal Details: Newry-headquartered Murdock Builders Merchants (Murdock) has acquired Brooks Group from Welsh-based Premier Forest Products Group.
The transaction details of the deal, which is subject to regulatory approval, were not disclosed.
Murdock was established in 1982 by the Murdock family. It is now the leading family-owned builders’ merchants in Ireland with 14 branches and 2 timber mills.
Brooks Group, comprising Brooks Builders Merchants (“Brooks”) and Dublin Plywood and Veneer (‘DPV’), was founded in 1790.
It is one of the largest timber and building suppliers in the Republic of Ireland with 7 thriving stores nationwide.
Acuity Law, Cardiff (Rachelle Sellek and Tom Saunderson) and Flynn O’Driscoll (Pat Flynn, Julian Cunningham, Cian O’Leary and John Darby) provided legal advice
Gambit Corporate Finance (Geraint Rowe), Deloitte (Paul Dunlea).
Murdocks Builders Merchants:
Eugene F Collins advised on the legals (Deborah Kelly, Eoghan Ó hArgáin, Lorna Osborne, Frances Colclough and Kathi Ó’Riain)
Grant Thornton provided corporate finance and tax advice (Emer Dowling, Patrick Dillon & Tom Roche)
Renatus Comment: Brooks was originally established in 1750 and has a long and storied heritage in timber provision and in merchanting in Ireland. Murdocks also announced that, following completion of the acquisition, it plans to appoint Eddie Kelly as chairman of Brooks Group. Mr Kelly has had a significant career in Irish builders merchanting and, as chief executive, led Grafton’s merchanting business in Ireland for seven years prior to his recent retirement.
Murdocks’ demand is likely to be driven by new housing completions. Given the significant shortage of housing with only 20,000 houses forecast to be completed in 2021, Murdocks is well placed to benefit from increased activity in the coming years.
Source: Murdock Building Merchants
Deal Details: Belfast-based Repstor is acquired by Intapp, a Californian cloud-based software solutions company, in a deal reported to be up to £36.5m (€42.53m).
Repstor specializes in optimizing Microsoft 365 productivity and information control for professional services firms and in-house legal teams.
Intapp helps professional and financial services firms better connect their people, processes, and data through AI-powered software solutions.
Advisers: None mentioned
Renatus Comment: Prior to the transaction Repstor had 17 shareholders including chief executive Alan Mcmillen, Fergus Wilson, Sheila Gormley and Paul Moorhead.
It is reported that Intapp has filed proposed terms for $278m IPO. Assuming a successful IPO, the company enterprise value would be approximately $1.5bn.
Deal Details: AIB is reportedly to invest €90m in Canada Life to form a life and pensions joint venture.
The bank, led by chief executive Colin Hunt, will invest €90m in the 50:50 joint venture, to cover its share of the set-up costs and regulatory capital required for the new business, it said in a statement.
Canada Life is owned by Great-West Lifeco, which is based in Winnipeg, Canada, and which also owns Irish Life.
Advisers: Key Capital advised Great-West Lifeco on the joint venture.
Source: Irish Times
Deal Details: Irish regulatory commission CCPC has cleared the acquisition by Allied Irish Banks, p.l.c. of sole control of GANMAC Holdings (BVI) Limited.
GANMAC Holdings (BVI) Limited is a holding company for the Goodbody Group, which comprises of a number of entities active in the provision of wealth management, investment banking, asset management and alternative investment fund management.
Deal Details: Last week we reported that a UK PE firm August Equity was to acquire majority stake in Dublin-headquartered cyber security specialist Integrity360. This deal has now been finalised.
Gerry Beausang led the team in ByrneWallace, which included senior associate Daniel Holohan, and solicitor Bianca McLaughlin from the Corporate Team, Partner Deirdre Lynch from the Employment Team, Partner Liam Connellan, Head of Pensions, Colin Bolger senior associate from the Tax Team and Zelda Deasy senior associate from the GDPR Team.
William Fry team led by Andrew McIntyre.
Source: August Equity
Deal Details: Irish competition watchdog CCPC has approved the CVC deal to acquire an equity stake in the Six Nations.
In 2020 and in light of the Covid-19 pandemic, CVC Capital Partners halved its initial offer from €330m to €165m for a 14.5% stake.
Source: CCPC; Renatus
Deal Details: Private equity firm Clayton, Dubilier & Rice (CD&R) is reportedly planning to increase its offer to buy UDG Healthcare to £2.72bn (€3.16bn), following investor opposition to a previously agreed bid.
Dublin-based UDG said the potential 1,080 pence per share offer would be CD&R’s final, adding that it plans to recommend the proposal.
In May, both the companies had agreed to a 1,023 pence per share offer.
Source: Irish Times
Deal Details: The owner of Virgin Media Ireland has reportedly put the business up for sale after last week completing the €36 billion merger of its UK operations with O2.
According to sources quoted in the report, Vigin could achieve up to €1.5bn.
Source: The Sunday Times
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
Andrews Group Limited, trading as Andrews Flour, is a Belfast-based flour milling company that provides quality flours used in both household and commercial baking.
For the period ending October FY20, revenue remained flat at c. £29.6m while EBITDA grew by c. 179% to £1.7m. EBITDA growth was a result of two percentage point increase in gross margins to c. 11% and a c. £650k reduction in admin and distribution expenses.
The net cash position improved by c. £937k during the period to end at an overdrawn position of c. £767k. There was c. 460k of fixed asset purchases and c. £352k of debt & interest payments during the period.
The business is predominantly owned by a number of members from the Moreland and Burnett families.
Persian Restaurants Limited operates a number of McDonald’s franchises in Dublin, Wexford and Wicklow.
In FY20, revenue dropped by c. 37% to c. €24.8m while EBITDA increased by c. 88% to €4.7m. The disparity in performance can be traced back to the COVID-19 impact on the business. The revenue decline is a result of an inability to trade properly for most of 2020 while the uplift in EBITDA is coming from a c. €8.2m reduction in staff costs for the period linked to government subsidies and supports.
The cash postion for the company improved by c. €4.6m to end at c. €12m. The big movers in cash was a loan repayment of c. €1.1m which was partially offset by fixed asset sales amounting to c. €725k.
The business is wholly owned by Amir Afsar.
Who: Spectrum.Life, founded in 2018 by Stuart McGoldrick along with Co-Founders Dr. Sarah O’Neill and Stephen Costello, announces funding round. Spectrum.Life supports 1,250+ entities in looking after the mental health and wellbeing needs of over 750,000 individuals, and their families.
What: €3m round was led by Act Venture Capital.
Why: The funds will be used to triple Spectrum.Life’s R&D team as it doubles down on product and engineering in response to greater needs for virtual interventions and services. The funds will also be used for the continued expansion into the UK market, with an eye to other international markets in Europe, Asia, Australia and New Zealand.
Who: Kastus, the Irish tech company focused on anti-microbial and anti-viral surface protection.
What: Raised €5.65m in series A funding round led by Alpha Ascent.
Why: The funds will help its expansion and meet customer demand for its product. It also announced plans to grow its global commercial team with more brand investment planned.
Advisers: Matheson advised Kastus.
Source: Irish Times
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.
Despite the global pandemic, this week the NTMA announced that the average interest rate on the Government debt pile will fall to a record low of 1.5% this year, resulting in an interest bill of €3.5bn. This is less than half the record interest of almost €8bn paid in 2013. The announcement coincided with news that head of the NTMA, Conor O’Kelly is due to step down next year. O’Kelly who enjoyed an accomplished private sector career prior to being appointed in 2015, has been a safe pair of hands over the last 6 years and his successor will still have to manage an enlarged debt pile from the pandemic. Let’s hope someone equally accomplished takes over the reins.
The year-on-year decrease in the Irish wholesale price index for May 2021, according to @CSOIreland
The KBC Bank Ireland’s consumer sentiment index for June 2021. This is back in line with the 25-year average of the series (86.8), suggesting sentiment has been normalised. @IrishTimesBiz
The COVID-19 adjusted unemployment rate for May 2021 amounting to 174,700 persons. This assumes all claimants of the Pandemic Unemployment Payment (PUP) are classified as unemployed, according to @CSOIreland
The traditional unemployment rate for May 2021. This is down from the revised rate of 7.9% in April 2021 and up from 5.1% in May 2020, according to
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