Signa Sports signs SPAC deal

BY Richard Summerfield

Signa Sports United has reportedly agreed to list on the New York Stock Exchange (NYSE) through a merger with a blank cheque company, in a deal valuing the firm at $3.2bn.

The deal will raise $645m in proceeds for Signa Sports, made up of $345m from special-purpose acquisition company (SPAC) Yucaipa Acquisition and another $300m from investors through a private investment in public equity (PIPE). The transaction has been unanimously approved by the boards of directors of each of Signa Sports and Yucaipa Acquisition and is subject to approval by Yucaipa Acquisition’s shareholders and other customary closing conditions.

The transaction is expected to close in the second half of 2021. Upon completion, the combined company will trade on the NYSE under the Signa Sports United name.

As part of the deal, Signa Sports will also acquire UK-based online rival Wiggle from its private equity owners. Wiggle generates annual sales of about $500m. The combined company is expected to generate net revenues of approximately $1.6bn in the financial year ending in September 2021, serving over seven million active customers.

“We’re proud and excited by this next chapter in SSU’s growth story. Becoming a listed company allows us to continue capturing market share in Europe and to accelerate our US and international expansion while scaling our platform solutions,” said Stephan Zoll, chief executive of Signa Sports. “We also look forward to welcoming WiggleCRC to our SSU family. The acquisition enhances our global online leadership especially in the bike category. Our focus on growth and internationalization coupled with our platform approach drives significant scale benefits.”

“SSU is a global leader in the fastest-growing sports categories and is well-positioned for continued success as a public company,” said Ron Burkle, chairman and president of Yucaipa. “With its technology platform – and a combination of scale, international growth and profitability – we expect SSU to grow its leadership positions and accelerate its global expansion. We look forward to becoming shareholders and partnering closely with the talented SSU team on this exciting journey.”

The deal is another in an increasingly long line of recent SPAC transactions. SPACs have become a popular alternative to the traditional IPO process for companies looking to list on a stock exchange, accounting for nearly half of the more than $200bn raised globally in new listings over the past year.

News: Signa Sports agrees SPAC deal, to buy Wiggle bicycle store - source

Datavant and Ciox Health to merge in $7bn deal

BY Richard Summerfield

Health data companies Datavant and Ciox Health have agreed to merge in a deal valued at $7bn.

The deal is expected to close in the third quarter of 2021, subject to regulatory approval and customary closing conditions. The newly merged company will be known as Datavant and will be led by Pete McCabe, chief executive of Ciox, the companies said in a statement.

The new company will be the largest health data ecosystem in the US, enabling patients, providers, payers, health data analytics companies, patient-facing applications, government agencies and life science companies to securely exchange their patient-level data. The company will have a network of more than 2000 US hospitals and 15,000 clinics as well as data analytics companies and government agencies.

“The fragmentation of health data is one of the single greatest challenges facing the healthcare system today,” said Mr McCabe. “Each of us has many dozens of interactions with the healthcare system over the course of our lives, and that information is retained in siloed databases across disparate institutions. Every informed patient decision and every major analytical question in healthcare requires the ability to pull that information from across the health data ecosystem while protecting patient privacy.”

He continued: “We are thrilled to join forces with the Datavant team to connect health data to improve patient outcomes. Together we are well positioned to navigate the technical, operational, legal, and regulatory challenges to doing so, and are committed to acting as a neutral connectivity solution for our many customers and partners.”

“Every decision made in healthcare should be informed by data,” said Travis May, chief executive of Datavant. “Our goal is to create a ubiquitous, trusted, and neutral data ecosystem where parties across the healthcare system can seamlessly and securely exchange data – unlocking better outcomes, faster research, and healthcare at a lower cost. The combined company is positioned to transform America’s health infrastructure and power the health data economy.”

The transaction is being supported by an existing investor group of private equity, venture capital and strategic investors led by New Mountain Capital, Roivant Sciences, Transformation Capital, Merck Global Health Innovation Fund, Labcorp, Cigna Ventures, Johnson & Johnson Innovation – JJDC, Inc., and Flex Capital. It also includes a significant new investment by Sixth Street with participation from Goldman Sachs Asset Management’s West Street Strategic Solutions fund. Sixth Street will join the new company’s board of directors on completion of the transaction.

News: Datavant and Ciox Health Announce Merger, Creating the Largest Neutral and Secure Health Data Ecosystem

Primavera acquires child nutrition business from Reckitt in $2.2bn deal

BY Fraser Tennant

Further enhancing its positioning and growth prospects in China's large infant nutrition market, investment firm Primavera Capital Group is to acquire consumer health, nutrition and hygiene company Reckitt Benckiser’s Mead Johnson business in a transaction valued at $2.2bn.

Under the terms of the definitive agreement, Reckitt will retain a shareholding in Mead Johnson of 8 percent and anticipates net cash proceeds to be approximately $1.3bn. The transaction follows Reckitt’s comprehensive review of its infant formula and child nutrition business in China announced in February 2021.

The deal is another milestone for Primavera in the consumer industry. Going forward, the investment firm intends to support Mead Johnson's growth in China through innovation, operational improvement, channel optimisation and digital transformation, to further enhance its positioning and growth prospects in China’s RMB150bn infant nutrition market.

"We are pleased to acquire the Greater China business of Mead Johnson, a long-established and renowned multinational infant and children nutrition brand,” said Dr Fred Hu, founder and chairman of Primavera Capital Group. “As the controlling shareholder, Primavera is committed to serve tens of millions of Chinese mothers and babies and safeguard their wellbeing.”

Following the completion of the transaction, Primavera will have a royalty-free perpetual and exclusive license of the Mead Johnson brand in Greater China.

“After a thorough review of our infant formula and nutrition business in China, we have found an excellent home for the business under the ownership of Primavera,” said Laxman Narasimhan, chief executive of Reckitt. “As a result of this transaction, Reckitt's Nutrition business going forward will have a better and more consistent growth and margin profile.”

Founded in 1905 in the US, Mead Johnson is a world-renowned premium infant milk formula brand. In 2009, the company successfully listed on the New York Stock Exchange, and in 2017 was acquired by Reckitt .

The transaction is expected to close in the second half of 2021, subject to customary regulatory approvals.  

Mr Hu concluded: “We look forward to collaborating with Reckitt management, and to continuing to provide customers the highest-quality nutritional products through world-class scientific innovation and R&D capabilities, as well as the strictest safety and quality control.”

News: Reckitt to sell China baby formula business for $2.2 bln

Avadim Health files for Chapter 11 and agrees ‘stalking horse’ sale

BY Fraser Tennant

Over $100m in debt and unable to turn a profit for years, health products company Avadim Health has filed for Chapter 11 bankruptcy in order to sell its assets and position itself for a “long and prosperous future”.

To facilitate the sale and restructuring, Avadim’s existing lender, Hayfin Capital Management, has entered into a binding stalking horse purchase agreement and committed to provide certain debtor-in-possession (DIP) financing, subject to court approval, to allow Avadim to meet its obligations during the process.

Furthermore, the financing that Hayfin has committed to provide in connection with the Chapter 11 filing, along with Avadim’s cash flow from operations, will provide ample liquidity to operate the business and meet ongoing obligations to customers, vendors and employees through the completion of the sale process.

Avadim has also announced it has retained investment bank SSG Capital Advisors, LLC to initiate a comprehensive marketing of its assets to other potential buyers to ensure it receives the highest and best price.

"Our goal is to pursue a transaction that maximises the value of the company and ensures we have the necessary resources and flexibility to invest in, and grow the business," said Keith Daniels, chief restructuring officer at Avadim. "We will continue to create and market world-class products, including our Theraworx line, that our customers have come to love."

"We are confident this action provides us with the most efficient and effective way to pursue a transaction while at the same time allowing us to address financial challenges and best position the company going forward," he continued. "To be clear, the action has no impact on our day-to-day business or our ability to continue serving our customers."

Based in North Carolina, Avadim Health develops and sells topical products to improve immune health, neuromuscular health and skin barrier health – products that target the institutional care and self-care markets.

Mr Daniels concluded: “We are proud of the important and meaningful work Avadim has done over the years and are committed to ensuring the company has the right resources in place to continue its mission. We are excited about our future."

News: Avadim Health Files Chapter 11 to Put Lenders in Control

A new era for Cloudera as the firm is taken private

BY Richard Summerfield

Data analytics firm Cloudera Inc. is to be taken private by private equity firms KKR & Co and Clayton Dubilier & Rice LLC (CD&R) in a $4.7bn deal.

According to a regulatory filing announcing the deal, Cloudera shareholders will receive $16 per share in cash, a premium of over 24 percent to Cloudera’s last close on Friday and a 30 percent premium to the company’s 30-day volume weighted average share price.

The deal is expected to close in the second half of 2021, subject to shareholder and regulatory approval. The board of directors of Cloudera has unanimously approved the transaction and recommends that the Cloudera shareholders approve the transaction and adopt the merger agreement.

Cloudera, which has activist investor Carl Icahn as its largest shareholder, has been exploring a potential sale since mid-2020 after receiving takeover interest from several parties.

“This transaction provides substantial and certain value to our shareholders while also accelerating Cloudera’s long-term path to hybrid cloud leadership for analytics that span the complete data lifecycle - from the Edge to AI,” said Rob Bearden, chief executive of Cloudera. “We believe that as a private company with the expertise and support of experienced investors such as CD&R and KKR, Cloudera will have the resources and flexibility to drive product-led growth and expand our addressable market opportunity.”

“We very much look forward to working with Cloudera as it continues to execute its long-term transformation strategy,” said Jeff Hawn, operating partner at CD&R, who will also serve as chairman of the company upon close of the transaction. “The company has made significant progress establishing the Cloudera Data Platform (CDP) as a leader in hybrid and multi-cloud analytics, and we believe that our experience and capabilities can offer valuable support to accelerate expansion into new products and markets.”

“We have followed the Cloudera story closely for a number of years and are pleased to be supporting its mission of helping companies make better use of their data in the ever-evolving hybrid IT environment,” said John Park, partner and head of Americas technology private equity at KKR. “We are excited to contribute to Cloudera’s accelerated innovation efforts as a private company.”

Cloudera provides cloud-based software and a platform to enterprises for data management and insights generation. The firm caters to several industries including finance, healthcare and government agencies.

News: KKR, CD&R take data analytics firm Cloudera private for $4.7 bln