Broadcaster Tegna goes private in $5.4bn Standard General deal

BY Fraser Tennant

In a move that takes the broadcaster private, Tegna Inc. is to be acquired by investment firm Standard General in an all-cash transaction valued at $5.4bn.

Under the terms of the definitive agreement, Standard General will acquire Tegna for $24 per share in cash. The transaction has been unanimously approved by Tegna’s board of directors.

Upon completion, Tegna will become a private company and its shares will no longer be traded on the New York Stock Exchange.

“This transaction is the next step in Tegna’s evolution and recognises the value of our portfolio of leading broadcast assets and innovative digital brands,” said Dave Lougee, president and chief executive of Tegna. “We are deeply gratified that Tegan’s new owners value and embrace our purpose to serve the greater good of our communities.”

With 64 television stations in 51 US markets, Tegna is the largest owner of top four network affiliates in the top 25 markets among independent station groups. The company also owns multicast networks True Crime Network, Twist and Quest.

“As long-term investors in the television broadcasting industry, we have a deep admiration for Tegna and the stations it operates,” said Soo Kim, founding partner of Standard General. “We believe Tegna has a strong foundation and exciting prospects for continued growth as a result of the stewardship of the board and the current management team. We look forward to building on the company’s strong foundation and leveraging its deep industry experience to drive further growth.”

Deb McDermott, previously chief executive of Standard Media Group, will become chief executive and Mr Kim will serve as chairman of a new board upon the close of the transaction.

The transaction is subject to approval by Tegna shareholders, regulatory approvals and other customary closing conditions, and is expected to close in the second half of 2022.

Ms McDermott concluded: “Tegna’s stations have earned excellent reputations as leading local content providers and our digital and content assets are a key part of its future in an evolving media landscape.”

News: Standard General to take U.S. broadcaster Tegna private in $5.4 billion deal

Celanese Corp to acquire DuPont unit for $11bn

BY Richard Summerfield

DuPont has agreed to sell most of its mobility and materials unit, including its engineering polymers business line and select product lines within the performance resins and advanced solutions business lines, to Celanese Corporation for $11bn in cash.

The deal, which will see roughly 5000 employees and 29 manufacturing sites move to Celanese, is expected to close around the end of the year, subject to customary closing conditions and regulatory approvals.

The DuPont businesses, which the company earmarked for sale back in November, had total 2021 revenues of $3.5bn and profits before taxes of $800m. The purchase will be a major acquisition for Celanese, which earned $2.8bn before taxes on $8.5bn in revenues in 2021, and will more than double the its engineered materials unit, which had $2.7bn in turnover in 2021.

“The transaction with Celanese that we are announcing today will create a market-leading portfolio serving the automotive, consumer and industrial markets with unmatched scale, manufacturing capability and technical expertise,” said Ed Breen, executive chairman and chief executive of DuPont. “We are proud of the strength of these industry-leading businesses, which we believe will be even stronger when combined with the highly complementary portfolio of Celanese. We are excited for Celanese to partner with the team and we are confident that together they will continue to drive industry-defining material science innovation to serve customers and the value chain.”

“We are excited to welcome our future colleagues from DuPont who have built a world-class product and technology portfolio which is highly regarded in the industry,” said Lori Ryerkerk, chairman and chief executive of Celanese. “Our businesses are highly complementary which will accelerate our growth in high-value applications including future mobility, connectivity and medical.”

The acquisition is expected to complement existing Celanese product lines in polyacetal, ultra-high molecular weight polyethylene, liquid crystal polymers and polyphenylene sulfide. DuPont’s nylon and PBT polymer production will back integrate Celanese’s compounding operations in those businesses. The unit will also extend Celanese’s reach in Asia, helping the company recover some of the presence in the region it relinquished when it sold its stake in the Polyplastics engineering polymer joint venture with Japan’s Daicel. Celanese expects to achieve $450m worth of synergies by integrating DuPont’s polymer businesses with its own within the first four years of deal close.

DuPont plans to use the proceeds of the sale to pay for its pending $5.2bn purchase of the electronic materials producer Rogers Corp, and to finance further acquisitions and share buybacks.

News: DuPont to shed mobility and materials unit in $11 bln Celanese deal

MoneyGram to be taken private in $1.8bn deal

BY Richard Summerfield

Private equity firm Madison Dearborn Partners has agreed to take MoneyGram International private in a deal worth $1.8bn.

Madison Dearborn will acquire all outstanding shares of MoneyGram for $11 per share in an all-cash transaction. The purchase price represents a premium of approximately 50 percent to MoneyGram's closing stock price on 14 December 2021, the last trading day prior to media speculation regarding a possible deal.

The transaction, which is expected to close in the fourth quarter of 2022, subject to customary closing conditions and regulatory approval, will see Madison Dearborn refinance MoneyGram’s outstanding debt, which was $799m as of 31 December 2021. Madison Dearborn has secured committed debt financing for the transaction from Goldman Sachs & Co. LLC, Deutsche Bank Securities Inc. and Barclays.

"We are excited to enter into this transaction with MDP, which will deliver immediate and compelling value to shareholders and enable us to accelerate the advancement of our digital growth strategy,” said Alex Holmes, chairman and chief executive of MoneyGram. “This transaction is the culmination of a thorough process by the MoneyGram Board to enhance shareholder value while positioning our business for continued growth and expansion."

“MoneyGram has undergone a rapid transformation over the last several years to expand our digital capabilities and adapt to the evolving needs of our customers,” he continued. “By partnering with MDP and becoming a private company, we will have greater opportunities to innovate and transform MoneyGram to lead the industry in cross-border payment technology and deliver a more expansive set of digital offerings, while leveraging our global platform for new customers and use cases. This transaction provides exciting opportunities for our dedicated MoneyGram team and partners, and I'm incredibly excited about the path ahead.”

“MoneyGram is a leader in cross-border payments with one of the strongest brands and reputations in the industry, and we are excited to partner with Alex and his leadership team as they continue to lead MoneyGram's digital growth strategy,” said Vahe Dombalagian, a managing director at Madison Dearborn. “We are looking forward to applying our substantial experience growing digital businesses and deep payments knowledge to help MoneyGram further strengthen its market-leading cross-border capabilities and enhance its digital platform.”

MoneyGram was almost acquired in 2017 by China’s Ant Financial but the $1.2bn agreement was blocked by the Committee on Foreign Investment in the United States.

News: Buyout firm Madison Dearborn to take MoneyGram private in $1.8 billion deal

Lockheed Martin terminates $4.4bn deal to acquire Aerojet Rocketdyne

BY Fraser Tennant

Blaming efforts by the US Federal Trade Commission (FTC) to block the acquisition, global security and aerospace company Lockheed Martin Corporation has terminated its agreement to buy rocket engine maker Aerojet Rocketdyne Holdings, Inc. in a $4.4bn deal.

The cancellation of the transaction comes three weeks after the FTC announced a lawsuit that sought to block the proposed merger on antitrust grounds – a preliminary injunction that would have put the deal on hold pending an administrative trial in June. 

The regulatory agency stated a concern that the proposed deal would hurt competition in the defence industry by allowing Lockheed to cut other contractors off from vital missile components Aerojet provides, particularly scramjet engines for hypersonic missiles and control systems for missile interceptors.

"Our planned acquisition of Aerojet Rocketdyne would have benefitted the entire industry through greater efficiency, speed and significant cost reductions for the US government," said James Taiclet, chairman, president and chief executive of Lockheed Martin. "However, we determined that in light of the FTC's actions, terminating the transaction is in the best interest of our stakeholders.”

Headquartered in Bethesda, Maryland, Lockheed Martin Corporation is a global security and aerospace company that employs approximately 114,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services.

"Moving forward, we will maintain our focus on the most effective use of capital with the highest return on investment, including our ongoing commitment to return value to shareholders,” added Mr Taiclet. “We remain confident in our company's strong foundation and growth potential as several exciting projects enter production.”

In a statement following the termination of the merger agreement, Aerojet said that it is was “poised to deliver substantial value to its shareholders, driven by its continued leadership in key space exploration and defence growth markets, including by advancing hypersonics and strategic, tactical and missile defence systems”.

Headquartered in El Segundo, California, Aerojet Rocketdyne is an innovative technology-based manufacturer of aerospace and defence products and systems, with a real estate segment that includes activities related to the entitlement, sale and leasing of the company’s excess real estate assets.

Mr Taiclet concluded: “We will continue to support the US and its allies through our industry leadership and developing the technologies to ensure effective threat deterrence for decades to come."

News: Lockheed scraps $4.4 billion deal to buy Aerojet amid regulatory roadblocks

Quantum computing leader D-Wave goes public in $1.6bn deal

BY Fraser Tennant

In a combination that will take it public, Canadian Quantum computing business D-Wave Systems Inc. is to merge with special purpose acquisition company (SPAC) DPCM Capital, Inc. in a transaction valued at $1.6bn.

Under the terms of the definitive transaction agreement, the combined company will receive $300m in gross proceeds from DPCM Capital’s trust account, as well as $40m in gross proceeds from a group of strategic and institutional investors participating in the transaction via a committed private investment in public equity (PIPE).

The PIPE is led by new and existing investors, including leading Canadian public sector pension plan manager PSP Investments, NEC Corporation, Goldman Sachs, Yorkville Advisors and Aegis Group Partners.

The transaction is expected to enhance D-Wave’s leadership in commercial quantum computing and accelerate quantum use cases into significant customer segments, including manufacturing, logistics, pharmaceuticals, finance and government.

Upon close of the transaction, shares of D-Wave Quantum Inc., a newly formed parent company of D-Wave and DPCM Capital, are expected to trade on the New York Stock Exchange under the symbol ‘QBTS’.

“This deal marks an inflection point signalling that quantum computing has moved beyond just theory and government-funded research to deliver commercial quantum solutions for business,” said Alan Baratz, chief executive of D-Wave Systems. “D-Wave, along with DPCM Capital and our new and long-term investors, collectively believe that this event represents a moment of practical value creation for customers and for investors.

“We are working with our customers to identify applications with high likelihood of quantum value and to translate those problems to run on the quantum computer and then validate that value,” he continued. “We expect this ‘value creation and validation’ to accelerate as an increasing number of diverse use cases emerge – creating a robust cycle of product delivery, application development and market growth.”

Unanimously approved by the boards of directors of D-Wave Systems and DPCM Capital, the transaction is expected to close in the second quarter of 2022, subject to the satisfaction of customary closing conditions, including approval by the stockholders of DPCM Capital.

Emil Michael, chief executive of DPCM Capital, concluded: “By accelerating the $150bn quantum computing market, we are confident that D-Wave will continue to deliver long-term value to stockholders.”

News: 4 Firms Rep Quantum Computing Biz's $1.6B Go-Public Deal