| M&A Deal Directory 2003 |
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| Deal Value Undisclosed |
FA Wyatt and Drammock (MBO) (also known as Maharry)
Acquirer: Management
Target: FA Wyatt and Drammock
Divestor: Greencore Group plc
Acquirer Advisor: Grant Thornton Corporate Finance
Target Advisor: CFM Capital Limited
Acquirer legal advisor: McCann Fitzgerald
Target Legal Advisor: Arthur Cox
Origin of target: Ireland
Origin of Acquirer: Ireland
Date of Announcement: 13/03/02
Date of Completion: 13/03/02
Consideration: Undisclosed
Following the acquisition of Hazlewood Foods plc, Greencore stated that it would sell a number of non-core assets to pay down debt. FA Wyatt and Drammock were not considered core to the Greencore strategy going forward. The Group engaged CFM Capital to find a suitable buyer. The management team proved to be the best buyer.
FA Wyatt is involved in the distribution of household cleaning products in Ireland. Drammock is Ireland’s only manufacturer of diapers and owns the Comfies brand. Management financed the deal through their own resources and Bank of Scotland (Ireland) provided bank financing.
Profile by: Jim Lillis.
Greencore Group plc, in line with its strategy of focussing on core activities, disposed of its subsidiary Maharry Holdings to a management buyout team in March 2002. Maharry Holdings is a holding company for FA Wyatt & Co Ltd and Drammock Ltd.
FA Wyatt is a specialist distributor business established in 1932. The company is distributor for Reckitt-Benckiser plc, Standard Brands Ltd and Drammock Ltd. The portfolio of products includes leading brands such as Finish, Vanish, Haze, Harpic, Brasso, Woolite and Mr Sheen. Drammock was established in 1983 and manufactures Comfies diapers and private label diapers for the Irish and UK markets.
Greencore’s principal activities are the manufacture and supply of convenience foods and ingredients to consumer, industrial and food service markets. Greencore acquired Maharry Holdings in 2001 as a part of Hazelwood Foods plc. Greencore embarked on a substantial disposal program after the Hazelwood acquisition. The management buy out of Maharry facilitated a complete exit for Greencore.
Grant Thornton Corporate Finance acted as financial advisor to the management buyout team and debt financing was provided by ICC- Heller Ltd (now Bank Of Scotland (Ireland)).
Profile by: Michael Neary.
Futura
Acquirer: MBO (backed by Spanish private equity firm Corpfin Capital)
Target: Futura
Divestor: Aer Lingus
Acquirer Advisor: Corpfin Capital Asesores
Target Advisor: Caja Madrid
Divestor advisor: NCB Corporate Finance
Acquirer legal advisor: Allen & Overy
Target Legal Advisor: Bufet Sorroca
Origin of target: Spain
Origin of Acquirer: Spain
Date of Announcement: 26/11/02
Date of Completion: 26/11/02
Consideration: Undisclosed
NCB Corporate Finance acted as financial adviser to Aer Lingus on the sale. NCB advised on all aspects of the transaction, including:
• Project management of the sale process
• Identifying and contacting interested parties
• Deal structuring
• Valuation
• Due diligence
• Negotiations with management, the private equity firm and their respective advisers
The transaction was one of the first venture capital-backed MBO’s in the aviation sector in Spain and represented a significant step in the completion of Aer Lingus’ strategy of disposing of non-core assets.
The successful completion of the deal concluded a very significant period in the financial restructuring of Aer Lingus.
Profile by Fergus McLoughlin.
Galileo International Limited
Acquirer: Galileo International Limited
Target: Timas Limited
Divestor: Aer Lingus Group plc
Divestor advisor: PwC Corporate Finance
Acquirer legal advisor: McCann FitzGerald
Divestor legal advisor: Arthur Cox
Date of Completion: 06/09/02
Consideration: Undisclosed
Galileo International, a subsidiary of the Cendant Corporation, acquired Timas Limited in September 2002.
Timas Limited, which trades as Galileo Ireland Limited, is the market-leading provider of CRS Services and office automation to the Irish travel market and offers network services through its Minerva business. Timas Limited acts as the sole distributor of Galileo’s services in Ireland handling approximately 80 per cent of travel bookings.
The acquisition of Timas Limited is in keeping with Galileo International’s strategic policy of buying out domestic distribution operations, a policy that has seen Galileo International taking over its distribution arms in the UK, Netherlands and Italy.
Timas Limited was sold by Aer Lingus Group plc and Automation & Investment Co-operative Society, an umbrella body of Irish travel agents, for an undisclosed sum. The transaction was initiated as part of the Aer Lingus policy of refocusing on its core scheduled airline business and facilitated a complete exit by both shareholders.
Profile by: Michael McGrail , head of PwC Corporate Finance.
Grassland Fertilisers
Acquirer: Private Consortium
Target: Grassland Fertilisers
Divestor: Greencore plc
Divestor advisor: NCB Corporate Finance
Divestor legal advisor: Arthur Cox
Origin of target: Ireland
Date of Announcement: 05/02
Date of Completion: 05/02
Consideration: Undisclosed
NCB Corporate Finance was corporate advisor to Greencore and NCB played a key role in identifying the bidding consortium and assisted the bidder in their negotiation of financing arrangements. NCB Corporate Finance’s role encompassed the following:
• Project management of the entire deal
• Preparing the company for sale
• Preparation of the Information Memorandum
• Identifying and contacting bidders
• Co-ordinating the due diligence
• Price negotiation
• Sale contract negotiation
Negotiation of funding arrangements with buyer consortium.
Profile by: Fergus McLoughlin.
John Paul Construction Group (MBO)
Acquirer: Management team
Target: Business of John Paul Construction Group
Acquirer Advisor: Origin Corporate Finance
Target Advisor: KPMG Corporate Finance
Acquirer legal advisor: Lavelle Coleman
Target Legal Advisor: Arthur Cox
Origin of target: Ireland
Origin of Acquirer: Ireland
Date of Announcement: 10/02
Date of Completion: 10/02
Consideration: Undisclosed
The shareholders of John Paul Construction Group, one of Ireland’s largest building groups required advice in reviewing and analysing their strategic options. KPMG Corporate Finance assisted the shareholders in exploring the range of available alternatives. A number of options were investigated and KPMG Corporate Finance determined that a management buy-out represented the best option for the group. In conjunction with KPMG Tax, KPMG Corporate Finance successfully structured and agreed a transaction to dispose the trade and business to the management team. KPMG Corporate Finance then successfully project managed the disposal through to completion.
Profile by: John Dillon is an associate director at KPMG Corporate Finance.
The Leinster Leader
Acquirer: The Leinster Leader Group
Target: Limerick Leader
Acquirer Advisor: PWC Corporate Finance
Target Advisor: KPMG Corporate Finance
Acquirer legal advisor: Eugene F. Collins & Co.
Target Legal Advisor: Arthur Cox
Origin of target: Ireland
Origin of Acquirer: Ireland
Date of Announcement: 3/12/02
Date of Completion: 02/01/03
Consideration: Undisclosed
The Limerick Leader is the primary paper of record for the North Munster area. The shareholders of the Limerick Leader had over a long period of time, repeatedly received strong expressions of interest from a number of potential buyers.
In early 2002, against a background of continuing consolidation taking place amongst the Irish regional newspapers and succession issues facing the company, KPMG Corporate Finance who have significant experience in the media sector, were appointed financial advisers to manage the sale of the Limerick Leader. KPMG Corporate Finance successfully managed a competitive sales process and in December 2002, the Limerick Leader Group was acquired by the Leinster Leader Group. This acquisition marked a strong strategic fit for the Leinster Leader Group, further strengthened their portfolio of newspapers in Ireland and marked their largest acquisition to date.
Profile by: John Dillon.
The acquisition of the Limerick Leader has catapulted the Leinster Leader into the top four of the regional newspaper groups in Ireland. The acquisition effectively doubles the size of the group.
The acquisition was financed largely by way of debt which was provided by Anglo Irish Bank. As the group was ungeared prior to the transaction, the use of debt finance will significantly enhance the returns to the shareholders.
The financing is innovative in the context of Irish acquisitions as the debt is substantially secured on the cashflows from the enlarged business, rather than a traditional asset backed loan. Anglo Irish Bank quickly recognised the quality of the cashflows and provided the necessary facility letters to allow the Leinster Leader become the preferred bidder in a competitive tendering process.
In addition to publishing the Limerick Leader newspaper, the company also has a modern printing press. This will enable the Leinster Leader print all its newspaper titles in-house, thereby retaining the printing profits within the group.
The consolidation of the Irish regional newspaper industry is set to continue over the coming years. The Leinster Leader will be at the forefront of future consolidation that will occur in the sector.
Profile by: David Tynan is an M&A director at PwC Corporate Finance
Musgrave Group
Acquirer: Musgrave Group
Target: Express Checkout
Acquirer Advisor: Deloitte & Touche
Target Advisor: PwC Corporate Finance
Acquirer legal advisor: Arthur Cox
Target Legal Advisor: Whitney Moore & Keller
Origin of target: Irish
Origin of Acquirer: Irish
Date of Announcement: 24/01/03
Date of Completion: Scheduled for early March 2003
Consideration: Undisclosed
The Express Checkout Group operates a chain of retail supermarkets in Counties Meath and Kildare, which trade under the SuperValue brand. The deal involves the Musgrave Group acquiring five retail supermarkets and one development site. The vendor is retaining one supermarket in Trim, which will continue to be operated by a family member.
The vendor established the business in 1983 with one store. Over the last 20 years, he has steadily built up the group to a stage where it became the largest retailer in County Meath, one of the fasted growing counties in Ireland. The stores operated to the highest standards and regularly won awards for being amongst the best-operated SuperValu franchises in the country.
Profile by: Bryan Evans, lead M&A partner at PwC Corporate Finance.
NewCourt Support Services Limited
Acquirer: NewCourt Support Services Limited
Target: Federal Security Services Limited
Acquirer Advisor: n/a
Target Advisor: KPMG Corporate Finance
Acquirer legal advisor: A&L Goodbody
Target Legal Advisor: Daniel Spring & Co
Origin of target: Ireland
Origin of Acquirer: Ireland
Date of Announcement: n/a
Date of Completion: 11/02
Consideration: Undisclosed
Federal Security Services was established by Bill Hennesey in 1985 and is the largest independent manned security companies in Ireland. KPMG Corporate Finance acted as advisors to Federal Security Services on the sale of the business.
KPMG Corporate Finance, who have significant transaction experience in the security sector, project managed the disposal process and successfully completed the disposal to NewCourt Support Services.
This transaction marked the first acquisition by NewCourt Support Services, a company funded by a number of prominent members of Ireland’s business community and venture capitalists to make acquisitions in the fragmented and fast growing Irish outsourcing sector.
Profile by: John Dillon.
Q-Park NV
Acquirer: Q-Park NV
Target: The Future Parking Services Group
Acquirer Advisor: BDO Simpson Xavier/Ernst & Young
Target Advisor: In-house
Aquirer Legal Advisor: Eugene F Collins
Target Legal Advisor: Arthur Cox
Date of Announcement: N/A
Date of Completion: 03/12/02
Consideration: Undisclosed
The Q-Park Group is a pan-European group engaged in the ownership, management and operation of high quality parking facilities with its unique housestyle, core values and quality standards. Based in The Netherlands, it also has operations in Belgium, France, Germany, the UK and, now, Ireland.
Following initial meetings with Q-Park’s acquisition team, BDO Simpson Xavier identified the Future Parking Services (‘FPS’) Group as an attractive target for Q-Park’s entry strategy into the Irish market. FPS, having just acquired Irish Car Parks Limited at the start of 2002, manages and operates 16 car parks throughout Ireland and also has freehold and leasehold interests in prestigious multi-storey car parks in Dublin and Cork.
BDO were appointed by Q-Park to advise on the transaction, which completed on 3rd December 2002. As a result of the FPS acquisition, Q-Park has added 6,000 parking spaces to its European total of 154,000 and increased staff numbers to close on 1,100 employees. It is anticipated that the Group’s annual turnover will exceed €187m in 2003.
The acquisition, which incorporated the transfer of an experienced management team and operations infrastructure, has also provided Q-Park with a solid foundation for further expansion into the Irish carpark market.
Profile by: Hugh Cooney, corporate finance partner in BDO Simpson Xavier.
Qpark Ireland stated objective was to enter the Irish ‘carpark’ market place. Acquisition of Future Parking which is one of Ireland’s biggest car park operators has given them a good market share in Ireland.
Future Parking owns or operates 13 car parks amongst which are those at St. Stephen’s Grseen and the Royal College of Surgeons in Dublin. They also acquired Irish Car Parks in early 2002 for e30m, which owned car parks at Marlborough Street, Setanta Centre, Dublin and Grande Parade Cork. Ernst & Young assisted Qpark in their due diligence and also provided tax structuring work.
Profile by: Sinead Munnelly.
The winner of the FINANCE ‘Deal of the Year 2003’ will be announced in FINANCE April. |
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| Article appeared in the March 2003 issue.
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