Private Equity
BlackRock Inc plans to raise about US$10 billion as part of a new business that would take direct stakes in companies, a source told Reuters. A multibillion-dollar fund could put the world’s largest asset manager in more direct competition with the likes of Berkshire Hathaway Inc’s Warren Buffett and private equity firms, including Blackstone Group LP, from which it was initially spun out. The new effort is being chaired by Mark Wiseman, who BlackRock hired in 2016 from the Canada Pension Plan Investment Board, the source said. Day-to-day management is being led by André Bourbonnais, the former CEO of Public Sector Pension Investment Board (PSP Investments).
2 min read · 08 February 2018
Canadian oil sands producer MEG Energy Corp said this week it had agreed to sell some pipeline and storage assets in Alberta to Wolf Midstream Inc for $1.61 billion to pay down debt and fund its flagship project in Athabasca, Reuters reported. MEG said it would sell its 50 per cent interest in the Access Pipeline for $1.4 billion and its full interest in the 900,000-barrel Stonefell oil storage facility for $210 million. Wolf Midstream, which formed a partnership with Canada Pension Plan Investment Board in 2015, said in a release that the acquisition will be funded by a CPPIB investment of up to $800 million and third-party debt financing. The deal gives the Calgary midstream company 100 percent ownership of the Access Pipeline.
2 min read · 08 February 2018
Hudson’s Bay Co said this week it has rejected Austrian property and retail group Signa Holding GmbH’s 3 billion euro bid (US$3.7 billion) for Hudson’s Bay’s Kaufhof unit, Germany’s largest retail chain, Reuters reported. The potential deal would have combined Germany’s two largest department store operators: Kaufhof and Signa’s Karstadt. Hudson’s Bay said in November it would review Signa’s offer for Kaufhof, but also called it incomplete, non-binding and unsolicited, with no evidence of financing. The Canadian retailer bolstered its financial position to support Kaufhof, agreeing last year to sell its flagship Lord & Taylor building in New York for US$850 million and bring on a US$500 million investment from U.S. private equity firm Rhône Capital.
3 min read · 07 February 2018
TerraForm Power Inc, controlled by Canada’s Brookfield Asset Management, has launched a 995 million euro (US$1.2 billion) takeover bid for Spanish renewable energy company Saeta Yield to expand its presence in Western Europe, Reuters reported. Saeta’s main shareholders, Spanish construction company ACS, headed by Real Madrid Chairman Florentino Perez, and U.S. fund Global Infrastructure Partners, which both hold 24 percent stakes, have agreed to sell their holdings. TerraForm said the deal would be financed with a US$400 million equity offering backed by Brookfield. Brookfield last year acquired TerraForm, formerly a unit of U.S. solar company SunEdison Inc, for US$$656 million.
2 min read · 07 February 2018
Canada’s Frontera Energy Corp has suspended operations at its Cubiro oilfield in northeastern Colombia after threats and attacks against workers, Reuters reported. Protests, attacks by National Liberation Army (ELN) rebels and community and judicial efforts to ban extractive industries are widely considered the top threats to Colombia’s oil industry. Frontera, formerly known as Pacific Exploration & Production Corp, is a portfolio company of Canadian private equity firm Catalyst Capital Group. The company closed a US$500 million restructuring deal with Catalyst and other creditors in 2016.
2 min read · 05 February 2018
Blackstone Group LP President Tony James said on Thursday the future of the Thomson Reuters Financial and Risk (F&R) business is in data, not in selling terminal desktop products to traders, bankers and investors, Reuters reported. “The most valuable part of that business by far is the data part. The terminals are the legacy business for which people think of them but that’s not where the future of that company is,” said James. U.S. private equity firm Blackstone this week agreed to buy a majority stake in the F&R business of Thomson Reuters Corp in a US$20 billion deal.
2 min read · 01 February 2018
Canadian private equity firm Onex Corp and Brookfield Asset Management said this week they do not intend to make an offer for IWG plc, sending shares of the British serviced office provider down more than 20 percent, Reuters reported. IWG, the company behind the Regus brand, which runs offices in about 3,000 locations in more than 1,000 cities, said in December it had received a bid approach from Onex and Brookfield but did not disclose details. Last month, Bloomberg reported the proposed deal's value at about 2.7 billion pounds (US$3.7 billion). IWG confirmed that discussions with Onex and Brookfield had ended and said it remained confident in its prospects as an independent company.
2 min read · 01 February 2018
Hudson’s Bay Co, owner of the Saks Fifth Avenue brand, is in a good position to go private following the sale of its Lord & Taylor flagship building in New York and an investment from Rhône Capital, activist investor Jonathan Litt wrote in a letter released this week. Management and insiders would need less than $400 million in additional capital to buy the 92 million shares they don’t already own at $18 per share to take it private, Litt said in the letter. The Canadian department store operator, which has been battling seven quarters of losses, agreed in October to sell the Lord & Taylor building to WeWork Cos for US$850 million, with U.S. private equity firm Rhône investing an additional US$500 million as part of the deal. Litt’s Land and Buildings hedge fund, which held a near 5 percent stake in Hudson’s Bay as of July, has been pressing the company to boost its sliding share price by extracting value from its sizeable real estate holdings.
2 min read · 31 January 2018
U.S. private equity firm Blackstone Group LP catapulted itself into the major leagues of Wall Street’s financial information industry this week with the acquisition of a majority stake in the Financial and Risk business of Thomson Reuters Corp, Reuters reported. The US$20 billion deal is Blackstone’s biggest bet since the financial crisis. Blackstone will acquire a 55 percent stake in a newly hived off F&R business, while Thomson Reuters will retain a 45 percent holding. Canada Pension Plan Investment Board and Singapore’s GIC will invest alongside Blackstone. The deal will give Thomson Reuters, controlled by Canada’s Thomson family, a formidable ally as it seeks to reinvigorate a business facing challenges from a shrinking and budget-conscious customer base.
5 min read · 30 January 2018
Banks are lining up a jumbo leveraged financing of around US$13 billion to back U.S. private equity firm Blackstone Group’s potential acquisition of a 55 percent stake in the Financial and Risk business of Thomson Reuters Corp, banking sources told Reuters. Bank of America Merrill Lynch, Citigroup and JP Morgan are expected to lead the debt financing, if the deal goes ahead, with several other banks due to the large size of the underwriting, the sources said. The deal values the Thomson Reuters unit at about US$20 billion. Although the size of the financing is challenging, liquid banks and investors are eager to lend to new buyouts as the strong level of global demand continues to exceed supply.
2 min read · 30 January 2018
