Diversified Energy agrees $1.3bn Maverick deal

BY Richard Summerfield

In a deal focusing on expansion within the oil & gas rich Permian basin, Diversified Energy has agreed to acquire private equity-backed Maverick Natural Resources for $1.28bn, including debt.

According to a statement announcing the deal, Diversified Energy will take on about $700m of Maverick Natural Resources’ debt, giving the combined company a value of about $3.8bn, including debt.

The deal is expected to close during the first half of 2025, subject to customary closing conditions, including, among others, regulatory clearance and approval by Diversified shareholders for the issue and allotment of the ordinary shares pursuant to the agreement. The deal has been unanimously approved by the Diversified board.

Upon completion, Maverick’s current owner, investment firm EIG Global Energy Partners, will own about 20 percent of the new company. Following closure of the deal, Diversified’s board will consist of eight directors, six of whom are members of the current Diversified board, and two of whom will be designated by EIG.

“Today marks an important milestone for all of us at Maverick Natural Resources,” said Rick Gideon, chief executive of Maverick Natural Resources. “We have great respect for the innovative approach and stewardship demonstrated by the team at Diversified and are pleased to enter into this partnership. Maverick has built a strong foundation of execution and efficiency across our portfolio, and we look forward to combining our complementary portfolio of assets with Diversified. I would also like to express my gratitude to the team at Maverick for their hard work and dedication in supporting our strategic efforts and contributing to this achievement.”

“This acquisition expands our unique and highly focused energy production company with a complementary portfolio of attractive, high-quality assets,” said Rusty Hutson, Jr., chief executive of Diversified. “We have a proven track record of unlocking value from acquisitions while maintaining our commitment to sustainability leadership, and this acquisition provides us with great assets and employees that complement this strategy. The acquired producing assets have demonstrated leading well performance and are a natural fit with our operating advantage and existing acreage. Notably, the combined footprint in Oklahoma and the Western Anadarko Basin creates one of the largest in terms of production and acreage, which includes the emerging Cherokee formation.”

“We are extremely pleased to have entered into this acquisition and look forward to contributing as a core shareholder,” said Jeannie Powers, managing director and head of domestic traditional energy at EIG. “We aim to work closely with the Diversified management team and Board to support the Company’s focus on delivering long-term value. Diversified is uniquely positioned in the upstream space with a differentiated business model and a history of operational excellence. The combination of Maverick’s assets with Diversified’s existing footprint represents a strategic opportunity that we believe can support value creation for all stakeholders.”

News: Diversified Energy to buy energy producer Maverick in $1.3 bln deal

Thoma Bravo completes $3.6bn fund

BY Richard Summerfield

Software investment firm Thoma Bravo has announced the closure of its Credit Fund III, the firm’s largest credit fund to date, on $3.6bn, signalling a continuation of the strong private debt fundraising cycle that began in H2 2024.

The firm announced it had completed its capital raising efforts for Thoma Bravo Credit Fund III on Tuesday, marking its largest pool of credit capital to date. The fund, which exceeded its predecessor by $300m, will focus on investing in senior secured debt of enterprise software companies. The fund has already invested over $1bn across 20 investments.

“We appreciate our investors’ continued recognition and strong support of Thoma Bravo’s differentiated platform and strategy in credit, which is a testament to its growth and success,” said Orlando Bravo, a founder and managing partner at Thoma Bravo. “As an early adopter of private credit, Thoma Bravo has long recognized the crucial role private credit plays in enterprise software.”

“We are very proud of the strong backing we have received from our investors for our strategy and team, at a time of tremendous opportunity in software direct lending,” said Oliver Thym, a partner at Thoma Bravo who leads the Thoma Bravo Credit platform. “We are excited to have broadened our platform to include unlevered capital and funds-of-one/separately managed accounts. We look forward to capitalizing on the growing market demand for our flexible and differentiated credit solutions and driving further success for our partners and investors in 2025.”

The Thoma Bravo Credit platform focuses on the senior secured debt of established, mission-critical enterprise software companies. The platform targets sponsor-backed companies and leverages Thoma Bravo’s extensive sector experience in enterprise software, as well as its broad and differentiated sourcing channels. Since its inception in 2017, the platform has invested over $8bn across approximately 100 transactions.

Thoma Bravo is one of the largest software-focused investors in the world, with over $166bn in assets under management as of 30 September 2024 and has invested in more than 500 companies over the last 20 years, representing $265bn in enterprise value. Through its private equity, growth equity and credit strategies, the firm invests in growth-oriented, innovative companies operating in the software and technology sectors.

The closure of Credit Fund III is indicative of the current strength in the fundraising cycle that began in H2 2024. Though H1 2024 saw a slump in fundraising, the second half of the year saw a strong recovery. Through Q3 2024, private debt funds raised a total of $169.2bn, which, according to Pitchbook, put 2024’s fundraising efforts on track to slightly exceed 2023’s total of $226bn. Significant fund closings include Blackstone’s senior direct lending fund that closed on $22bn in October 2024 and Ares’ third direct lending vehicle that closed at $33.6bn in July 2024.

News: Thoma Bravo Completes Fundraising for Credit Fund III, Amassing $3.6 Billion in Total Available Capital for its Platform

Mondee files for Chapter 11 in pursuit of long-term growth

BY Fraser Tennant

In a move designed to position the company for long-term growth, air ticket consolidator Mondee Holdings has filed for Chapter 11 bankruptcy in order to facilitate a series of transactions contemplated under a restructuring support agreement (RSA).  

The transactions include a term sheet to sell substantially all of the assets of Mondee to a newly formed entity owned by, among others, affiliates of TCW Asset Management Company LLC and Wingspire Capital LLC.

Should the TCW bid be the successful one, following the closing of the sale, Prasad Gundumogula, co-founder, chairman of the board and previously chief executive, will have a 75 percent equity stake in, and serve as chief executive of, the newly formed entity.

While Mondee pursues a sale of the company to the current bidder or another party with a higher or better offer, its existing secured lenders will continue to provide support throughout the Chapter 11 proceeding by committing to an additional $27.5m financing for operating capital, in addition to the $21.5m of financing recently made available.

Throughout the court-supervised process, Mondee will operate its business as usual and will continue to support its customers and partners without disruption. The Chapter 11 proceedings do not impact Mondee entities in Brazil, Mexico, India and Canada.

“Today’s announcement marks an important step forward for Mondee, our valued customers, partners and our dedicated team as we continue to transform our business for the future,” said Jesus Portillo, chief executive of Mondee. “With a sustainable capital structure and a structured sales process, we will be well-equipped to enhance our leadership in the travel market.”

Additionally, Mondee is in the process of filing first day motions with the bankruptcy court. The relief requested will ensure a smooth transition into Chapter 11 and the ability to maintain normal operations, including Mondee’s commitments to customers and partners and the payment of employee wages and benefits.

Established in 2011 and operating 21 offices globally, Mondee drives change in the leisure and corporate travel sectors through its broad array of innovative solutions. Available both as an app and through the web, the company’s platform processes over 50 million daily searches and generates a substantial transactional volume annually.

Mondee is looking to move expeditiously through the bankruptcy process and emerge from Chapter 11 in the beginning of the second quarter of 2025.

Mr Portillo concluded: “We have taken decisive action to overcome past challenges and are encouraged by employee engagement, organisational culture, and our ability to deliver best-in-class products and services.”

News: Mondee files for bankruptcy in the US

United Rentals acquires competitor H&E in $4.8bn deal

BY Fraser Tennant

In a deal that expands its capacity in strategic US markets, American equipment rental company United Rentals is to acquire one of its major competitors, H&E Equipment Services, in a transaction valued at approximately $4.8bn.

Under the terms of the definitive agreement, which has been unanimously approved by the boards of directors of both companies, United Rentals will acquire H&E for $92 per share in cash.

As the largest equipment rental company in the world, United Rentals has an integrated network of 1571 rental locations in North America, 39 in Europe, 37 in Australia and 19 in New Zealand. In North America, the company operates in 49 states and every Canadian province, with approximately 27,550 employees serving construction and industrial customers, utilities, municipalities, homeowners and others.

The integration of H&E into United Rentals’ operations presents opportunities to improve efficiency, productivity and new business development with the adoption of United Rentals’ operational excellence, including its technology offerings.

“In H&E we are acquiring a well-run operation that’s primed to benefit from our technology, operations and broad value proposition,” said Matthew Flannery, chief executive of United Rentals. “Most importantly, we are gaining a great team that shares our intense focus on safety and customer service.

“This purchase supports our strategy to deploy capital to grow the core business and drive shareholder value,” he continued. “This acquisition allows us to better serve our customers with expanded capacity in key markets while also providing the opportunity to further drive revenue through our proven cross-selling strategy.”

Founded in 1961, H&E is one of the largest rental equipment companies in the US. Comprised of aerial work platforms, earthmoving, material handling and other general and specialty lines, H&E serves a diverse set of end markets in many high-growth geographies and has branches throughout the Pacic Northwest, West Coast, Intermountain, Southwest, Gulf Coast, Southeast, Midwest and Mid-Atlantic regions.

The transaction is subject to customary closing conditions, including a minimum tender of at least a majority of then-outstanding H&E common shares and the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

“I could not be more pleased with this win-win outcome for both organisations, our customers and our shareholders,” concluded John M. Engquist, executive chairman of H&E. “I am confident that we have found an excellent landing spot for them and I am excited for the new opportunities they will have as part of United Rentals.”

News: United Rentals boosts equipment capacity with $4.8 billion H&E deal

GSK to acquire IDRx for $1.15bn

BY Richard Summerfield

Drug manufacturer GSK has agreed to acquire US biopharmaceutical firm IDRx, which is developing a therapy for the treatment of gastrointestinal stromal tumours (GIST).

Under the terms of the deal, GSK, Britain’s second-biggest drugmaker behind AstraZeneca, will pay $1bn upfront, with potential for an additional $150m success-based regulatory approval milestone payment. The acquisition includes lead molecule, IDRX-42, a highly selective KIT TKI being developed as a first- and second-line therapy for the treatment of GIST. GIST are the most common subtype of soft tissue sarcoma, with up to 120,000 patients diagnosed globally every year.

GSK will also be responsible for success-based milestone payments as well as tiered royalties for IDRX-42 owed to Germany’s Merck KGaA.

The deal will add to GSK’s growing portfolio in gastrointestinal cancers and is a continuation of its M&A strategy: acquiring assets designed to treat validated targets with unmet need. The company agreed a $2bn acquisition of Bellus Health and a $1.9bn takeover of Sierra Oncology in 2023 and 2022 respectively.

Since she became GSK’s chief executive in 2017, Emma Walmsley has been making acquisitions to boost key areas, after slimming down the overall drugs portfolio. Sales of vaccines, one of GSK’s strengths, have been falling.

The deal comes just one month after GSK gained an exclusive option to obtain a licence to develop and commercialise Duality Biologics preclinical antibody-drug conjugate, DB-1324, which leverages DualityBio’s duality immune toxin antibody conjugate platform against a gastrointestinal cancer target.

IDRX-42 is currently being evaluated in a phase 1/1b trial among GIST patients who have received second-line or more treatment. Data from the study, dubbed StrateGIST 1, demonstrate a manageable safety profile and favourable durability, according to GSK. IDRX-42 has gained FDA fast-track designation for treating patients with GIST after disease progression on or intolerance to imatinib, plus an orphan drug tag for GIST.

“IDRX-42 complements our growing portfolio in gastrointestinal cancers,” said Luke Miels, chief commercial officer of GSK. “This acquisition is consistent with our approach of acquiring assets that address validated targets and where there is clear unmet medical need, despite existing approved products.”

“We are excited by the early data from IDRX-42 and its unique ability to target all clinically relevant KIT mutations present in GIST, a major gap in the current standard of care,” said Tony Wood, chief scientific officer of GSK. “We look forward to accelerating its development in 2025 to redefine treatment.”

“We are looking forward to working with GSK to advance IDRX-42 for patients with GIST given there have been no major advances to the standard of care for almost 20 years,” said Tim Clackson, chief executive of IDRx. “Combining our experience to date with GSK’s expertise in GI cancers, global clinical development capability, and strong commercial presence in oncology will help to accelerate the development of this novel medicine for patients.”

News: GSK to buy US biotech firm IDRx for up to $1.15 billion