KKR-led consortium agrees €1.56bn Accell acquisition

BY Richard Summerfield

A consortium led by private equity giant KKR has agreed to acquire Accell Group in a deal worth €1.56bn.

Under the terms of the deal, the consortium will pay €58 per share for all shares in Accell Group, representing a total consideration of approximately €1.56bn. The offer price represents a premium of 26 percent over the closing price on 21 January 2022, a premium of 42 percent over the last three months volume-weighted average price per share, and a premium of 21 percent to Accell Group’s all-time high closing price of €48 per share.

The group’s two largest shareholders, Teslin and Hoogh Blarick, which hold 10.8 percent and 7.5 percent of shares respectively, said they would support the transaction. The deal is expected to close in late Q2 or early Q3 2022.

Accell Group’s existing board, comprised of chief executive Ton Anbeek, chief financial officer Ruben Baldew and, as of 1 February 2022, chief supply chain officer Francesca Gamboni, will continue to lead the group.

“Today’s announcement marks an important step for Accell Group,” said Mr Anbeek in a statement. “With the Consortium as our new shareholder we will have a financially strong and knowledgeable partner to accelerate the roll-out of our existing strategic roadmap, enhance our global footprint, explore suitable acquisitions and further leverage our scale. As such, the Transaction will enable us to take a leap forward as a group which also brings along enhanced career opportunities for our employees.”

He added: “We continuously strive to be a leader in the bicycle industry by combining smart design and innovative technology with the best value and customer experience. With KKR coming on board as majority shareholder, and with the continued support of Teslin, we would be able to accelerate the execution of our strategic agenda, launch new innovations for green mobility and support to the benefit of people and communities.”

“With Accell Group, the Consortium is committed to further developing the Netherlands as the global capital of cycling by building on the company’s leading position in the European e-bike market and continuing to grow its strong heritage brands,” said Daan Knottenbelt, partner and head of Benelux at KKR. “This investment in Accell Group would build on KKR's significant experience of investing in the Netherlands. KKR has the capabilities to support high quality Dutch businesses to accelerate their domestic and global growth ambitions, and to overcome challenges such as those Accell Group faces in the competitive global bike market.”

News: KKR buys Sparta, Raleigh bike maker Accell for $1.77 bln

Mimecast to be taken private by Permira

BY Richard Summerfield

Email security company Mimecast has agreed to be taken private by funds advised by private equity firm Permira in a deal worth $5.8bn.

Under the terms of the agreement, which was approved and recommended by an independent special committee, and then approved by the Mimecast board of directors, Mimecast shareholders will receive $80 in cash for each ordinary share they own. The purchase price represents a premium of approximately 16 percent to Mimecast’s closing stock price on 27 October 2021, the last full trading day prior to rumours of a potential deal appearing in the press.

The transaction is expected to close in the first half of 2022, subject to customary closing conditions, including approval by Mimecast shareholders and receipt of regulatory approvals. Upon completion of the transaction, Mimecast will become a privately held company and the ordinary shares of Mimecast will no longer be listed on any public market. The deal has a ‘go-shop’ period of 30 days for Mimecast to court other offers.

“Today is an exciting milestone for Mimecast as we begin a new chapter for our company,” said Peter Bauer, chairman and chief executive of Mimecast. “Our team has done an outstanding job growing and expanding our relationships with customers and innovating our platform. Permira has a strong track record of collaboratively supporting companies’ growth ambitions and strategic goals, and we look forward to working together to further strengthen the cybersecurity and resilience of organizations around the world. This is a great outcome for our company and our shareholders.”

 “We have long admired Mimecast, its management team and its talented employees,” said Michail Zekkos and Ryan Lanpher, partners at Permira. “Email is the leading vector for cyberattacks, and phishing and impersonation attempts are continuously evolving. This means there has never been more urgency or need for organizations to protect their critical data and infrastructure. With an innovative platform, world-class security controls and scalable model, Mimecast is ideally positioned to help companies both large and small protect their employees from malicious activity. We look forward to leveraging our experience scaling global technology businesses as we partner with Peter and team on their next phase of growth.”

“Mimecast is widely recognized as an established leader and innovator in the email security space with a strong and growing position in the enterprise market,” said Pierre Pozzo, a principal at Permira. “We share the company’s belief in the significant opportunity ahead in cybersecurity across all collaboration channels, especially as more individuals have transitioned to a remote workplace. We look forward to partnering with the Mimecast team to accelerate the product roadmap and expand the go-to-market organization in order to drive further growth.”

News: Permira to take email security firm Mimecast private in $5.8 bln deal

Record breaker: VC investment in Canada hits $11.8bn, reveals new report

BY Fraser Tennant

Canadian venture capital (VC) investment has hit record levels in 2021, with a year-to-date (YTD) total of CA$11.8bn, according to a new report by the Canadian Venture Capital & Private Equity Association (CVCA).

The YTD total, which includes $3.5bn invested across 174 deals in the third quarter (Q3), propelled 2021 beyond the previous highest annual VC investment of $6.2bn recorded in 2019.

In its report, ‘Q3 2021 Canadian Venture Capital Market Overview’, the CVCA reveals that the average deal size is a record-setting $20.7m – approximately double the $11m recorded in 2019 and the previous highest year on record. Moreover, the average growth-stage investment YTD in Q3 2021 was $129m, which has more than tripled over the last three years.

In addition, investments into later and growth-stage companies have received 63 percent of total VC dollars invested in Q3 2021, a significant increase from prior years (50 percent in 2019 and 49 percent in 2020).

In terms of deal size, there were 55 megadeals ($50m-plus) YTD, accounting for 74 percent of investment in 2021 so far. Notable megadeals in Q3 included Vancouver-based Dapper Labs’ $319m closing, Toronto-based Clearco’s $270m funding and the $265m investment in Montréal-based Blockstream.

“Investment in Canada’s startups has never been stronger,” said Kim Furlong, chief executive of the CVCA. ​“With the recent crop up of new continuation funds and the average growth stage investment rising, we are seeing a willingness to hold with investors as they stay the course in their investments — a testament to the maturing Canadian venture ecosystem.”

Concurrent with its 2021 VC investment analysis, the CVCA has also published a report into private equity investment in Canada over the same period – ‘Q3 2021 Canadian Private Equity Market Overview’ – which reveals a YTD total of $13.2bn invested across 584 deals.

“We are on the journey through post-pandemic recovery,” concluded Ms Furlong. ​“Some of the performance figures we are seeing in Q3 are trending towards pre-covid levels. The consumer and retail sector, for example, has seen some significant investment growth, at almost five times the levels experienced since a low in 2018.”

Report: Q3 2021 Canadian Venture Capital Market Overview

Qualcomm and SSW Partners agree $4.5bn Veoneer deal

BY Richard Summerfield

Chip manufacturer Qualcomm and newly formed private equity firm SSW Partners have agreed to acquire Swedish automotive technology group Veoneer for $37 a share in a deal worth $4.5bn.

The deal for Veoneer ends the ongoing battle for the company which had been a target for both Qualcomm and Magna International Inc, a Canadian mobility technology company. In July, Magna made an offer worth around $3.8bn for Veoneer which was accepted by Veoneer’s board. As a result of the agreed Qualcomm/SWW deal, Veoneer has terminated its prior acquisition agreement with Magna, which means Veoneer will pay a termination fee of $110m to Magna.

The boards of Veoneer and Qualcomm have both approved the transaction and expect it to close next year. Under the terms of the deal, at closing, SSW Partners will acquire all of the outstanding capital stock of Veoneer, shortly after which it will sell Veoneer’s autonomous-driving software operation, known as Arriver, to Qualcomm and retain Veoneer’s Tier 1 supplier businesses. SSW will also seek owners for the rest of Veoneer’s businesses. The Arriver business emerged from a collaboration between Qualcomm and Veoneer first announced in August 2020. The transaction is the first deal for SSW Partners.

“Qualcomm is the natural owner of Arriver,” said Cristiano Amon, president and chief executive of Qualcomm. “By integrating these assets, Qualcomm accelerates its ability to deliver a leading and horizontal ADAS solution as part of its digital chassis platform. We believe that this transaction and structure benefits both Qualcomm’s and Veoneer’s shareholders, positions all of Veoneer’s businesses for success and provides a compelling opportunity to customers and employees.”

“This transaction creates superior value for our shareholders,” said Jan Carlson, chairman, president and chief executive of Veoneer. “It also provides attractive opportunities to our Arriver team at Qualcomm and allows our other businesses to find long-term industrial partners where they can continue to develop.”

“We are excited to partner with Qualcomm to acquire Veoneer,” said Antonio Weiss and Josh Steiner of SSW Partners. “While Qualcomm focuses on the Arriver business, we will focus on finding strong, long-term strategic homes for the rest of Veoneer’s businesses – we are committed to ensuring that Veoneer’s employees prosper, the businesses continue to innovate and grow and customers continue to have uninterrupted access to the outstanding service and quality for which Veoneer is known. We have high regard for Veoneer’s management team and look forward to partnering with them to ensure a successful outcome for all stakeholders.”

News: Qualcomm, SSW Partners to buy Veoneer in $4.5 billion deal

Packable strikes $1.55bn SPAC deal

BY Richard Summerfield

Ecommerce marketplace enablement platform Packable has entered into a definitive agreement to merge with Highland Transcend Partners Corp, a special purpose acquisition company (SPAC), in a deal worth $1.55bn.

Packable, which is backed by private equity firm The Carlyle Group, was valued at around $1.1bn in November 2020 when Carlyle invested $250m to acquire its stake in the company.

Under the terms of the deal, Packable’s existing shareholders will receive 71 percent of the combined company, Highland Transcend SPAC founders and investors will own 19 percent, while private investment in public equity (PIPE) investors, including Fidelity Management & Research Company, Lugard Road Capital, Luxor Capital, Park West Asset Management and Morningside, will receive the remaining 11 percent.

“This is an incredibly exciting time for our team, and we are thrilled to partner with Highland Transcend as we plan to enter our next chapter as a public company,” said Packable co-founder and chief executive Andrew Vagenas. “While we’ve become a market leader in our industry, there is significant runway ahead of us in multiple avenues: from the continued proliferation of online marketplaces and geographic opportunities to our ability to invest in and grow Digitally Native Brands, while providing new data and technology services, as well as marketing options for our brand partners.”

“While we believe that third-party marketplaces will contribute more than 40 percent of all ecommerce revenues by 2025, brands find themselves challenged to manage the complexity of executing across these platforms,” said Ian Friedman, chief executive of Highland Transcend. “Packable has a leading software-driven offering enabling brands to grow their businesses across multiple online marketplaces. Andrew and the entire team have built an incredibly strong competitive platform; with approximately 75 million customer transactions to-date, we believe that Packable has one of the largest sets of third-party marketplace transaction data, outside of the marketplaces themselves. This data enables Packable’s competitive pricing, merchandising, and marketing decisions and will allow the company to launch a Software-as-a-Service offerings in the future.”

News: Carlyle-backed Packable agrees $1.55 billion SPAC merger