M&A daily wrap: Pillsbury, Smucker, Brynwood, Sportradar, CPPIB, TCV, EQT, Sallie Krawcheck


Bloomberg News

Brynwood Partners has agreed to acquire a portfolio of brands from the J.M. Smucker Co. (NYSE: SJM) for $375 million. The portfolio includes the exclusive U.S. rights to the well-known Pillsbury brand’s shelf-stable baking products, along with the Hungry Jack, White Lily, Jim Dandy and Martha White brands. The Pillsbury brand is a household name, in part due to the popularity of its advertising mascot, the giggling Poppin’ Fresh character, also known as the Pillsbury Doughboy. The Pillsbury brand license agreement is a royalty-free, perpetual agreement with General Mills Inc. (NYSE: GIS), encompassing all U.S. shelf-stable baking products, including flour, dry baking mixes and ready-to-spread frosting, in the retail channel. The transaction also includes the 650,000 square foot manufacturing facility in Toledo, Ohio, and is expected to close in the third quarter of 2018, subject to customary U.S. regulatory review. Smucker bought Pillsbury as part of its 2004 acquisition of International Multifoods Corp. “The deal added an array of so-called center-of-the-store brands, including muffin mixes and frostings, to its portfolio,” Bloomberg News points out. “More recently, the drive toward healthy-eating has drawn consumers to the perimeter of grocery stores in search of fresh produce and less processed foods. This shift in taste and habits has challenged U.S. consumer-packaged food companies and cut into growth for many large, well-known brands.” Smucker’s flour, baking ingredients, baking mixes and frosting businesses have lagged, together accounting for about 5 percent of revenue in fiscal 2017, down from about 10 percent in 2014, according to data compiled by Bloomberg. Brynwood, based in Greenwich, Connecticut, specializes in corporate carve-outs. “This is a hallmark deal for Brynwood Partners and marks the 52nd brand acquisition from the 19th corporate seller across our long history,” says Brynwood president Ian MacTaggart. Brynwood did not retain an investment bank but was advised by Holland & Knight LLP on legal matters.

The Canada Pension Plan Investment Board (CPPIB), through its subsidiary, CPP Investment Board Europe S.à r.l., and Silicon Valley-based growth equity firm TCV together are acquiring a minority stake in sports data provider Sportradar from private equity firm EQT and minority shareholders. The deal values the St. Gallen, Switzerland-based company at EUR 2.1 billion ($2.4 billion). Carsten Koerl, founder and CEO, is retaining his entire majority stake and will continue to drive its future development and growth. EQT is also reinvesting a portion of its sale proceeds into Sportradar. Additional existing shareholders include: basketball legend Michael Jordan; Ted Leonsis, owner of the National Hockey League’s Washington Capitals; Mark Cuban, owner of the National Basketball Association’s Dallas Mavericks; and venture capital firm Revolution Growth, founded by Leonsis and America Online co-founder Steve Case.

Exponent, a networking group for women dealmakers that launched in 2017, is gearing up for its first marquee event, called Exponent Exchange, on July 12. The keynote speaker is Sallie Krawcheck, who previously served as CEO of several banks, including Merrill Lynch Wealth Management and the Citi Private Bank, and is now the CEO of Ellevest, an online investing website aimed at women. Additional speakers include: Lisa Bernstein, global head of human capital, Apollo Global Management LLC (NYSE: APO); Sarah Bradley, partner, Kainos Capital; Janet Cowell, CEO, Girls Who Invest; Mary Kathleen Flynn, editor-in-chief,Mergers & Acquisitions; Jennifer Lu, executive director, Moelis & Co. (NYSE: MC); Natalia Oberti Noguera, founder and CEO, Pipeline Angels; Thu Do, chief product officer, Tastemakers Africa; and Adrianne Shapira, managing director, Eurazeo Brands. Underscoring enthusiasm for initiatives aimed at women, sponsors of the event include leading dealmaking companies, such as Apollo, Baird, BDO, Merrill Corp. and Moelis. Read the full story: Entrepreneurs Sallie Krawcheck, Cheraé Robinson to speak at Exponent Exchange.

Deal news
AE Industrial Partners has closed its second private equity fund, AE Industrial Partners Fund II LP, with $1.36 billion in commitments. The fund will make control investments in technical manufacturing, distribution and supply chain management, MRO (maintenance, repair and overhaul), and industrial service-based businesses. “With our deep operating expertise and valuable relationships in these sectors, we are well positioned to uncover unique opportunities and create value for our investors,” says AEI managing partner Michael Greene. Eaton Partners served as AEI’s placement agent, and Kirkland & Ellis provided legal advice.

Palladium Equity Partners has invested in Spice World, a supplier of garlic and other flavorings under the Spice World brand. Deloitte Corporate Finance and Moore & Van Allen advised Spice World. Piper Jaffray (NYSE: PJC), Kirkland & Ellis and Simpson Thacher & Bartlett advised Palladium.

LLR Partners has sold IO Education to Insight Venture Partners-backed Illuminate Education. IO Education is a Software-as-a-Service provider of student data and professional management services. Harris Williams & Co. advised IO Education.

Core Industrial Partners-backed Prototek Sheetmetal Fabrication LLC has acquired Hayes Manufacturing Services, a manufacturer of of precision-machined plastic and metal parts. Winston & Strawn represented Core and Prototek. Monroe Capital provided financing.

Canon Inc. has bought BriefCam, a provider of video synopsis and deep learning services. The deal expands Canon’s offerings in network cameras, video management software and video content analysis software. Shea & Co. advised BriefCam.

Featured content
Private equity firms are more active in the public sector than they were a couple of years ago, Brian Miller, the CFO of Tyler Technologies Inc. (NYSE: TYL), tells Mergers & Acquisitions. The company’s $150 million deal for data service company Socrata probably will not be the company’s last. Tyler has completed more than 40 acquisitions in the past decade. Read the full story: Tyler Technologies sticks with M&A strategy, despite PE competition.

Justify recently joined the elite group of Triple Crown winners. But, as anyone who’s ever bet the ponies knows, they can’t all be Justifys. Sometimes you get a winner and sometimes, for reasons that aren’t quite clear to anyone, you get an underperformer. It’s a concept with which most fund sponsors may be intimately familiar. You bet on the investment because you foresee its potential and understand the path it needs to take in order to achieve it. Here’s a step-by-step guide to getting a stuck-in-the-mudder into racing shape, written by Accordion‘s Rishi Jain and Anthony Horvat: 6 strategies to turn an underperformer into a “mudder.”

Huron Capital’s new Flex Equity Fund resonates with companies that “need a partner to help them grow, or to provide some liquidity, but don’t want to give up a controlling interest,” says partner Douglas Sutton in this video interview shot at ACG InterGrowth 2018. The Detroit firm won Mergers & Acquisitions’ M&A Mid-Market Award for 2017 Seller of the Year. Watch the video: Huron’s Flex Equity resonates with owners who don’t want to give up control.

As the dominoes start to fall and momentum builds, timing will matter to investors in cannabis, writes Jeffrey Howard, managing partner at Salveo Capital, an alternative investment firm specializing in the legalized cannabis sector, in a guest article. For most, the question isn’t whether the federal government legalizes cannabis, it’s how much longer investors will be able to capitalize on this undefined future to influence and profit from how the ecosystem ultimately takes shape, says Howard. If the M&A market can serve as a leading indicator, the runway for investors is already becoming shorter as strategic buyers represent, both, a threat and opportunity. In fact, major players within Big Alcohol, Big Tobacco and Big Pharma have each made inroads in the space, which proves out the investment thesis, but will surely beckon added competition. Read the full story: How to seize M&A opportunities in marijuana’s gray market.

Summer reading list: From stories of star athletes Arnold Palmer, Keith Hernandez and Tiger Woods to advice from entrepreneurs Bridgewater AssociatesRay Dalio, KPCB’s John Doerr, Nike’s Phil Knight and Brava Investments’ Nathalie Molina Niño, plus strategies to help business leaders in general, and female dealmakers in particular, the 15 books on Mergers & Acquisitions’ list entertain, instruct and inspire. Check out our listicle: Dealmaker’s guide to summer reading: 15 new books.


Mary Kathleen Flynn

Mary Kathleen Flynn

Mary Kathleen Flynn joined SourceMedia in 2011, serving as the Editor-in-Chief of Mergers & Acquisitions. MK oversees the brand’s content on all media platforms, including website, e-newsletters, video, slideshows, podcasts and print.


Demitri Diakantonis

Demitri Diakantonis

Demitri Diakantonis joined SourceMedia in 2015 and serves as Managing Editor of Mergers & Acquisitions. He covers all aspects of middle-market deamaking, with a focus on strategic buyers and the consumer and retail sectors, and writes The Buyside column.