Kimberly-Clark to acquire Softex Indonesia in $1.2bn deal

BY Fraser Tennant

In a $1.2bn deal which highlights its commitment to emerging markets, US multinational personal care  company Kimberly-Clark Corporation is to acquire diaper maker Softex Indonesia, a leader in the fast-growing Indonesian personal care market.

A large, growing market with attractive future prospects, approximately 80 percent of Softex Indonesia’s sales come from diapers – an estimated at $1.6bn market and the sixth largest in the world. The remaining sales are mostly in the feminine care and adult care categories.

Kimberly-Clark’s all-cash acquisition of Softex immediately improves its currently limited position in the country to one with strong market share in key personal care categories across Southeast Asia's largest economy.

"This acquisition represents a compelling strategic fit and demonstrates our commitment to accelerate growth in developing and emerging markets," said Mike Hsu, chairman and chief executive of Kimberly-Clark. "Moreover, adding Softex Indonesia and its brands to Kimberly-Clark will enhance our company's underlying growth prospects and help us create even more long-term shareholder value."

The acquisition is another demonstration of Kimberly-Clark's commitment to generate improved, sustainable top-line growth and create long-term shareholder value. Moreover, the transaction will be financed primarily through incremental debt and secondarily, cash on hand.

"Softex Indonesia has a strong, growing and profitable business with a portfolio of brands loved by Indonesian consumers," said Aaron Powell, president of Kimberly-Clark's Asia-Pacific consumer business. "This acquisition provides an opportunity for Kimberly-Clark to accelerate our growth in Southeast Asia, and we look forward to combining our strengths in innovation and brand building to expand on Softex Indonesia's continued success."

Since 1976, Softex Indonesia has built a successful personal care business with strong market positions and has consistently delivered double-digit growth. The company has excellent manufacturing capabilities and a strong go-to-market distribution network. Softex Indonesia generated net sales of approximately $420m in 2019.

The transaction is subject to customary closing conditions and expected to close in the fourth quarter of 2020.

News: Kimberly-Clark to buy Indonesian diaper maker Softex for $1.2 billion

Aveva agrees to acquire OSIsoft for $5bn

BY Richard Summerfield

Aveva has agreed to acquire OSIsoft, its SoftBank-backed US rival, for $5bn. The deal is expected to close by the end of 2020.

Aveva intends to fund the acquisition through a combination of a $3.5bn rights issue (to be launched in the autumn), cash and new debt facilities.

The OSIsoft acquisition is one of the largest deals ever attempted by a listed UK technology company. The combined company is expected to have annual revenue of £1.2bn, with adjusted earnings before interest and taxes predicted to be about £330m.

“Combining Aveva and OSIsoft is yet another significant milestone in our journey to achieving the ambitious growth goals that we have set,” said Craig Hayman, chief executive of Aveva. “This will not only help us serve existing customers better but also open the flood gates to new opportunities which will accelerate the delivery of our digitisation vision.

“Data has been enabling organisations to more effectively determine the cause of problems by allowing them to visualise what is happening in different locations, departments and systems,” he continued. “This agreement will enable our customers to improve business processes as well as eliminate inefficiencies. We are extremely proud to be moving into the next chapter with an even stronger solutions portfolio as well as an ever-increasing and robust customer base which continues to make us leaders in our sector.”

“Joining forces with Aveva enhances and extends our ability to deliver on our key commitments to our customers, partners and employees,” said Dr. J. Patrick Kennedy, chief executive and founder of OSIsoft. “Together we will be better able to service the largest digital transformation projects in history, including across industry 4.0+ and IIoT. Aveva’s interest in OSIsoft is a testament to our talented team, and the extraordinary value of the PI System as the real-time streaming data infrastructure that powers the industrial world.”

He added: “Today’s announcement is the culmination of a thoughtful search for a respected organisation that would mesh with our own strong mission- and customer-driven culture.  The next chapter in PI’s fifth decade will be exciting for our employees and customers, and I look forward to my continued involvement in my new role as the largest individual shareholder in the combined company and as Chairman Emeritus to ensure we realise the full benefits of this transaction.”

Osisoft is jointly owned by SoftBank’s Vision Fund and founder and Mr Kennedy’s family. SoftBank acquired a holding in Osisoft in 2017 and owns a 44.7 percent stake in the company.

News: UK software provider Aveva buys OSIsoft for $5 billion as Softbank cashes out

Blackstone to acquire Takeda Pharma’s consumer unit for £2.3bn

BY Fraser Tennant

In a deal valued at $2.3bn, Japanese multinational Takeda Pharmaceutical Company Limited has sold its consumer healthcare business – Takeda Consumer Healthcare Company Limited (TCHC) – to US investment firm Blackstone.

Under the terms of the definitive agreement, Blackstone and its affiliates will acquire a variety of over-the-counter medicines and health products from TCHC – products which generated total revenues of more than $566m in 2019.

Following the divestment of TCHC, Takeda Pharmaceutical Company Limited has said it will focus on developing drugs for unmet medical needs and rare diseases.

“Throughout the decades, TCHC’s brands including Alinamin have earned the trust and confidence of consumers in Japan,” said Milano Furuta, chairman of the board at TCHC. “We believe the active and strategic investment by Blackstone will enable TCHC to maximise its potential. Blackstone is one of the world’s leading investment firms and has rich experience in the healthcare sector, and we are confident this will help TCHC further develop its products and brands and strengthen the business overall.”

TCHC’s flagship vitamin drug Alinamin has been a staple product in Japanese households for Almost 70 years. In addition to Alinamin vitamin tablets and drinks, TCHC offers a platform of other over-the-counter products, including Benza Block, a leading symptom based cold remedy.

“We are privileged to announce this partnership and invest in the company’s plans to become the leading consumer healthcare business in Japan,” said Atsuhiko Sakamoto, head of private equity at Blackstone Japan. “TCHC is well-positioned to grow its established brands in Japan and launch new and expanded product offerings.”

One of the world’s leading investment firms, Blackstone’s assets under management (AUM) total $564bn. The deal to buy TCHC is Blackstone’s second private equity transaction in Japan’s healthcare sector following the acquisition of AYUMI Pharmaceutical in 2019.

Acting as exclusive financial adviser to Blackstone is Mitsubishi UFJ Morgan Stanley Securities, while Simpson Thacher & Bartlett LLP and Anderson Mori & Tomotsune are acting as legal advisers.

Mr Sakamoto concluded: “We see tremendous potential for TCHC in Japan and throughout Asia, and we are confident that Blackstone’s global network and expertise in the sector can accelerate TCHC’s growth.”

News: Takeda to sell Japan consumer health unit valued at $2.3 billion to Blackstone

Sanofi to acquire Principia for $3.7bn

BY Richard Summerfield

French healthcare company Sanofi SA has agreed to acquire Principia Biopharma Inc for around $3.7bn, the companies have confirmed.

The deal, which will strengthen Sanofi’s presence in research and development (R&D) areas, will see the company buy all the outstanding shares of Principia for $100 per share in cash, representing an aggregate equity value of approximately $3.68bn on a fully diluted basis, and a premium of 10 percent to Principia Biopharma’s closing price of $90.74 on 14 August.

“This acquisition advances our ongoing R&D transformation to accelerate development of the most promising medicines that will address significant patient needs,” said Paul Hudson, chief executive of Sanofi. “The addition of multiple BTK inhibitors to our pipeline demonstrates our commitment to strategic product acquisitions in our priority therapeutic areas. Full ownership of our brain-penetrant BTK inhibitor ‘168 removes complexities for this priority development program and simplifies future commercialisation.”

“The Phase 2b data in relapsing multiple sclerosis showed the strong potential of ‘168 to address disability and disease progression, and triggered the start of Phase 3 studies across the full spectrum of MS,” said John Reed, global head of R&D at Sanofi. “Through this acquisition, we will be able to expand and accelerate development of BTK inhibitors across multiple indications. Both ‘168 and rilzabrutinib have ‘pipeline in a product’ potential, and we look forward to unlocking their full treatment benefits across an array of diseases.”

“Principia’s successful design and development of a whole portfolio of BTK inhibitors for immunology is aimed to transform the treatment for patients with immune-mediated diseases,” said Martin Babler, president and chief executive of Principia Biopharma. “By combining with Sanofi, we will bring significant resources to expand and accelerate the potential benefits of these therapies. The benefit of developing several BTK inhibitors will allow us to target specific organ systems for optimal patient benefit. The merger will provide global resources to get these novel therapies to patients faster.”

Sanofi expects to complete the acquisition in the fourth quarter of 2020.

News: Sanofi in hunt for specialty drugs with $3.7 billion deal for U.S.-based Principia

Liberty Global secures Sunrise deal

BY Richard Summerfield

Liberty Global has agreed to acquire Sunrise Communications in an all-cash, $7.4bn deal.

Under the terms of the deal, Liberty Global will pay 110 francs per share for Sunrise, a 32 percent premium to the company’s average share price over the past 60 days. The transaction is expected to close around year end, subject to regulatory approval.

Last year, a $6.3bn deal which would have seen Liberty sell its Swiss cable unit UPC to Sunrise collapsed following opposition from shareholders including Freenet, a German company that owns 24 percent of Sunrise. On Wednesday, Freenet pledged its support to the new bid, which “appreciates the value that Sunrise has created over the past five years”.

“The industrial logic of this merger is undeniable, but the real winners are Swiss consumers and businesses,” said Mike Fries, chief executive of Liberty Global. “This powerful combination of 5G wireless and gigabit broadband will accelerate digital investment at a time when connectivity has never been more essential. Fixed-mobile convergence is the future of the telecom sector in Europe, and now Switzerland will have a true national challenger to drive competition and innovation for years to come. We look forward to welcoming Sunrise employees to the Liberty and UPC family and congratulate them and the board on their success.

“This transaction is another significant step on our path to create fixed-mobile champions in all of our core markets, crystallising the value of our superior broadband networks and driving long-term, sustainable free cash flow growth. Even after this deal, and assuming completion of our recently announced UK transaction, we will continue to have approximately $7 billion of liquidity to drive value-creation for shareholders,” he added.

“Sunrise has delivered on its quality-focussed strategy and built one of the best mobile networks worldwide,” said Andre Krause, chief executive of Sunrise. “We have successfully gained market share in all our businesses, underpinned by our strong focus on customer centricity, service excellence, innovation and quality offering. We are very proud of what our employees have achieved and believe that the combination with UPC Switzerland will enable the combined company to become the leading fully converged challenger in the market.”

The combined business will have 3.17bn Swiss francs in revenue, with a customer base comprising 2.1 million mobile subscribers, 1.2 million broadband subscribers and 1.3 million TV subscribers — around a 30 percent market share in each segment, according to Liberty Global.

News: Liberty Global surprises with $7.4 billion deal to buy Sunrise in latest telecoms consolidation