Experienced Leadership in Middle Market Direct Lending

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Twin Brook focuses on loans to private equity-owned companies with EBITDA between $3 million and $50 million, with an emphasis on companies with $25 million of EBITDA and below. The Firm targets senior ﬁ nancing opportunities up to $400 million with hold Experienced Leadership sizes across the Twin Brook platform ranging from $25 million up to $150 million. For more information, visit twincp.com in Middle Market Direct Lending

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Deal of the Year Fortive Dealmaker of the Year Hollie Haynes Private Equity Firm of the Year TA Associates Private Equity Seller of the Year Riverside Strategic Buyer of the Year Nike Investment Bank of the Year Harris Williams Lender of the Year Monroe Capital Law Firm of the Year Goodwin

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0C2_MAJ0419 2 3/7/2019 1:11:02 PM Contents April 2019 | VOL. 54 | NO. 4

Cover Story 16 12th Annual M&A Mid-Market Awards Excelled. Innovated. Inspired. That’s what the eight winners of Mergers & Acquisitions’ M&A Mid-Market Awards did in 2018.

Private Equity Perspective 12 Expect more tech Private equity firms are raising money to back tech companies, and tech is infusing dealmaking at all levels.

The Buyside 14 Sizing up the right deal Shoe companies are making investments that will set them up for the future, while gaining new customers.

10 Watercooler Why investors like restaurants Feature 6 Partnering with Paulson and TriArtisan 34 PE execs give back will help P.F. Chang’s implement a Top investment banks of 2018 José E. Feliciano, the co-founder and “collaborative growth strategy.” KPMG, Houlihan Lokey, Goldman of Clearlake Capital Group LP, and his Sachs, William Blair and Lincoln Inter- wife Kwanza Jones are donating $1 Mobile drives growth in payments national led the pack in deal volume. million to Bennett College. ACI is buying Western Union’s bill pay 9 business, Speedpay. Digitizing the energy sector Thoma Bravo-backed Quorum Soft- Guest Article People Moves ware is buying Coastal Flow Mea- surement Inc., a software resources 32 39 provider to the energy industry. How to structure partnerships between New hires and promotions independent sponsors and PE firms Stacey Dion was promoted to global 10 Sellers need to learn how PE firms head of government affairs at the Mid-market investment banks merge and independent sponsors can work Carlyle Group. Angad Hira gets Canaccord Genuity Group has ac- together, says Boyne Capital Partners’ promoted to CFO at VMG Partners. quired mid-market investment bank Derek McDowell. Rob Ruegger joins Kainos Capital as a Petsky Prunier for up to $85 million. managing director.

TheMiddleMarket.com April 2019 Mergers & Acquisitions 1

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TheMiddleMarket.com 1 STATE STREET PLAZA, 27TH FLOOR NEW YORK, NY 10004-1505 • (212) 803-8200 EDITOR-IN-CHIEF Mary Kathleen Flynn MANAGING EDITOR World class Demitri Diakantonis CONTRIBUTING EDITORS Keith Button, Danielle Fugazy The winners of Mergers & Acquisitions’ 12th annual GROUP EDITORIAL DIRECTOR, BANKING AND CAPITAL MARKETS M&A Mid-Market Awards excelled, innovated and Richard Melville inspired EXECUTIVE DIRECTOR, CONTENT OPERATIONS AND CREATIVE SERVICES Michael Chu SR. ART DIRECTOR Nick Perkins Congratulations to the winners of Mergers & Acquisitions’ 2018 M&A Mid-Market Awards! VICE PRESIDENT, CAPITAL MARKETS Harry Nikpour (212) 803-8638 Deal of the Year: Fortive Corp.’s $775 million ASSOCIATE MARKETING MANAGER acquisition of construction software devel- Leatha Jones oper Gordian from Warburg Pincus LLC was a transformative deal for the buyer and for the construction industry as a whole. Dealmaker of the Year: Hollie Haynes raised CHIEF EXECUTIVE OFFICER �� Gemma Postlethwaite CHIEF FINANCIAL OFFICER ��Sean Kron Luminate Capital Partners’ second fund with EVP & CHIEF CONTENT OFFICER �� David Longobardi $425 million of capital, securing the technology-focused private equity CHIEF STRATEGY OFFICER...... Jeff Mancini firm’s position as a consummate investor in middle-market enterprise CHIEF DATA OFFICER...... Christian Ward SVP, CONFERENCES & EVENTS ��John DelMauro software companies. Private Equity Firm of the Year: TA Associates invested a record $2.8 billion in new portfolio companies (more than double the previous year). The firm also celebrated its 50th anniversary, and completed its 500th investment. REPRINTS AND LICENSING CONTENT Private Equity Seller of the Year: The Riverside Co. completed 16 For more information about reprints and licensing content from Mergers & Acquisitions, please visit sourcemediareprints. exits, made 60 investments, and delivered a record fundraising year, as com or contact pars international at (212) 221-9595.

the firm marked its 30th anniversary. CUSTOMER SERVICE Strategic Buyer of the Year: Nike Inc. (NYSE: NKE) bought Zodiac [email protected] or (212) 803-8500

Inc. and Invertex Ltd., bringing aboard “world-class data-science tal- Mergers & Acquisitions Vol. 54/No. 4 (ISSN 0026-0010) is published monthly with combined issues in July/August ent and best-in-class tools to power 1:1 relationships with consumers and November/December by SourceMedia, One State Street Plaza, 27th Floor, New York, NY 10004-1505. Yearly through digital and physical consumer experiences.” subscription is $1,995; $2035 for one year in all other Investment Bank of the Year: Harris Williams completed 87 transac- countries. Periodical postage paid at New York, NY and U.S. additional mailing offices. POSTMASTER: Send address tions in 2018, the most in the firm’s history. changes to Mergers & Acquisitions / SourceMedia, One State Street Plaza, New York, NY 10004. For subscriptions, Lender of the Year: Monroe Capital grew AUM by $1.8 billion, or 35 renewals, address changes and delivery service issues contact our Customer Service department at (212) 803- percent, over the previous year, bringing the total to $7 billion. 8500 or email: [email protected]. This publication is designed to provide accurate and authoritative information Law Firm of the Year: Goodwin grew by double digits across key regarding the subject matter covered. It is sold with financial metrics, marking the firm’s sixth consecutive year of the understanding that the publisher is not engaged in rendering financial, legal, accounting, tax, or other record revenue and profits, with technology-rich practice areas driving professional service. Mergers & Acquisitions is a registered trademark used herein under license. © 2019 Mergers & growth. M&A Acquisitions and SourceMedia, Inc. All rights reserved. – Mary Kathleen Flynn

2 Mergers & Acquisitions April 2019

002_MAJ0419 2 3/11/2019 11:14:45 AM An experienced team that has closed over 315 transactions and committed over $9.4 billion.

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News & features PE fundraising Special reports

Hiring while dealmaking Siris Capital is active in M&A, and also made a couple of hires recently

Announced a deal to buy Travelport for $4.4 billion 47 49

Acquired Web.com for $2 billion 29 20 79

Sold Polycom to Plantronics for89 $2 billion

56 Hired Hilton Romanski as74 a parther

Hired Joe Cozzolino as an executive partner 47 35 12

Source: Siris Capital P.F. Chang’s gets new backers Siris Capital raises new fund 36 women deal pros are on the list Paulson & Co. and TriArtisan Capital Technology-focused private equity firm Mergers & Acquisitions has named Advisors LLC have bought restau- Siris Capital Group has raised its fourth the 2019 Most Influential Women in rant chain P.F. Chang’s China Bistro fund at $3.45 billion. Siris has been ac- Mid-Market M&A. Pelham S2K’s Venita Inc. from Centerbridge Partners. P.F. tive recently. The firm purchased Web. Fields, Kayne Anderson’s Nishita Cum- Chang’s owns and franchises more com for $2 billion; announced plans to mings and Kainos Capital’s Sarah Brad- than 300 Asian restaurants globally. buy Travelport for $4.4 billion; and sold ley are among 36 featured dealmakers. Polycom to Plantronics for $2 billion.

4 Mergers & Acquisitions April 2019

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INVESTMENT CRITERIA TARGET INVESTMENTS • Middle market companies starting at • Private equity sponsored $5 million EBITDA • Privately held • Specialty finance companies INVESTMENT PRODUCTS • Independent sponsor transactions • Unitranche, cash flow and enterprise value loans INDUSTRY VERTICALS • Club and syndicated transactions • Healthcare • Asset backed loans • Technology • Recurring revenue loans • Media • SaaS financing • Specialty finance • Equity co-investments • Independent sponsor TRANSACTION TYPES • Acquisitions • Refinancings • Growth capital • Leveraged recapitalizations • Specialty finance • Special situations

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“Ultimately it is because we think that by investing in the education of these young ladies, we are investing in magnifying the greatness of our nation and in a better future for humanity -- one that involves women and minorities in all aspects of so- ciety, including business and science and other careers, where they can make a difference.” As the private equity industry matures, firms and their leaders are stepping up their involvement in philanthropy. GTCR managing director Phil Canfield and his wife Mary Beth Canfield recently announced a $20 million donation to the University of Texas at Austin’s McCombs School of Business. In recognition of the gift, the program has been renamed the Canfield Business Honors Program. Many private equity firms are developing programs to encourage employees to give back - from mentoring students in schools to organizing groceries at food pantries and from running races for cancer cures to cleaning pens at animal shelters. BENNETT COLLEGE PE execs give back

José E. Feliciano, the co-founder and managing partner of Clearlake Capital Group LP, 2019 UPPER MIDWEST and his wife Kwanza Jones are donating $1 million to Bennett College CAPITAL CONNECTION VOTED JUNE 10- 11, 2019 • MINNEAPOLIS, MINNESOTA “A MUST By Demitri Diakantonis and Mary Kathleen Flynn ATTEND” by Attendees KEYNOTE SPEAKER José E. Feliciano, the co-founder and managing partner of the country’s only other all-women’s HCBU. Bennett enjoys a JOIN US FOR THE CAPITAL PHILIP KAUFMAN Chief Executive Officer Clearlake Capital Group LP, and his wife Kwanza Jones are rich history of educating women leaders, including: Dr. Dorothy CONFERENCE OF THE YEAR! UnitedHealthcare of Minnesota, donating $1 million to Bennett College, a women’s historically Brown, the first woman to practice general surgery in the North Dakota and South Dakota black college or university, or HCBU, in Greensboro, North South, who served as chief of surgery at Nashville’s Riverside ACG Minnesota's Upper Midwest Capital Connection is the Carolina. Jones is an impact investor and the founder and Hospital; Carolyn Robertson Payton, the first woman, and region’s premier gathering of middle market professionals CEO of Supercharged by Kwanza Jones, a lifestyle and per- the first African American, to head the U.S. Peace Corps; and involved in corporate growth and mergers and acquisitions. REGISTER TODAY sonal development brand. Yvonne Jeffries Johnson, the first African-American mayor of acg.org/minnesota Meet local and national private equity funds and investment The couple invests in education, entrepreneurship, equal Greensboro, North Carolina. bankers at this event. opportunity and empowerment through the Kwanza Jones & Feliciano and Jones made the gift on behalf of Jones’ FOR MORE INFORMATION José E. Feliciano Supercharged Initiative. The donation is one mother, Dorothy Wilkerson Jones, who graduated from Ben- • Golf • Private Equity panel & SPONSORSHIP of the single largest grants in Bennett’s history and helped the nett in 1965 with a degree in pre-law and a minor in political • Lawn bowling • Lunch keynote OPPORTUNITIES college raise $8.2 million, as it was facing loss of accreditation science, as well as Jones’ aunt, Brenda Wilkerson Hoover, who • Opening night reception • DealSource Contact Nicki Vincent, and possible closure due to financing issues. graduated in 1963 with a degree in elementary education. • Breakfast panel • Closing Reception Executive Director at Founded in 1873 as a coeducational institution, Bennett “Our gift to Bennett College comes not only from a deep • Private Equity exhibit [email protected] or 612-590-1041 became women’s only in 1926. Spelman College in Atlanta is personal connection with many of its alumnae,” says Feliciano.

6 Mergers & Acquisitions April 2019 TheMiddleMarket.com

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“Ultimately it is because we think that by investing in the education of these young ladies, we are investing in magnifying GTCR-backed Resonetics the greatness of our nation and in a better future for humanity buys again -- one that involves women and minorities in all aspects of so- ciety, including business and science and other careers, where The deal represents the third acquisition they can make a difference.” for Resonetics in precision micro- As the private equity industry matures, firms and their manufacturing leaders are stepping up their involvement in philanthropy. GTCR managing director Phil Canfield and his wife Mary Beth Canfield recently announced a $20 million donation to the GTCR-backed Resonetics has acquired Caribou Technolo- University of Texas at Austin’s McCombs School of Business. gies, expanding the buyer’s services into centerless grinding, In recognition of the gift, the program has been renamed forming, coiling, and machining. The deal represents the third the Canfield Business Honors Program. Many private equity acquisition for Resonetics in precision micro-manufacturing firms are developing programs to encourage employees to over the past year, following investments in Medelec and give back - from mentoring students in schools to organizing STI Laser. Caribou also expands Resonetics in the medical groceries at food pantries and from running races for cancer devices. cures to cleaning pens at animal shelters. “Consistent with our initial investment thesis for Resonet- BENNETT COLLEGE PE execs give back

José E. Feliciano, the co-founder and managing partner of Clearlake Capital Group LP, 2019 UPPER MIDWEST and his wife Kwanza Jones are donating $1 million to Bennett College CAPITAL CONNECTION VOTED JUNE 10- 11, 2019 • MINNEAPOLIS, MINNESOTA “A MUST ATTEND” by Attendees KEYNOTE SPEAKER the country’s only other all-women’s HCBU. Bennett enjoys a JOIN US FOR THE CAPITAL PHILIP KAUFMAN Chief Executive Officer rich history of educating women leaders, including: Dr. Dorothy CONFERENCE OF THE YEAR! UnitedHealthcare of Minnesota, Brown, the first woman to practice general surgery in the North Dakota and South Dakota South, who served as chief of surgery at Nashville’s Riverside ACG Minnesota's Upper Midwest Capital Connection is the Hospital; Carolyn Robertson Payton, the first woman, and region’s premier gathering of middle market professionals the first African American, to head the U.S. Peace Corps; and involved in corporate growth and mergers and acquisitions. REGISTER TODAY Yvonne Jeffries Johnson, the first African-American mayor of acg.org/minnesota Meet local and national private equity funds and investment Greensboro, North Carolina. bankers at this event. Feliciano and Jones made the gift on behalf of Jones’ FOR MORE INFORMATION mother, Dorothy Wilkerson Jones, who graduated from Ben- • Golf • Private Equity panel & SPONSORSHIP nett in 1965 with a degree in pre-law and a minor in political • Lawn bowling • Lunch keynote OPPORTUNITIES science, as well as Jones’ aunt, Brenda Wilkerson Hoover, who • Opening night reception • DealSource Contact Nicki Vincent, graduated in 1963 with a degree in elementary education. • Breakfast panel • Closing Reception Executive Director at “Our gift to Bennett College comes not only from a deep • Private Equity exhibit [email protected] or 612-590-1041 personal connection with many of its alumnae,” says Feliciano.

TheMiddleMarket.com April 2019 Mergers & Acquisitions 7

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sells personalized boxes that come with items such as nuts and trail mix through Digitizing the subscription delivery, as well as in retail energy sector companies. “Graze believes that learning from Uni- Thoma Bravo-backed lever’s sustainable living plan will become Quorum Software provides a key driver for the business,” says Graze tools to about 75 CEO Anthony Fletcher. “Graze has an

DITCH WITCH percent of the largest oil RESONETICS incredibly exciting future ahead as part of ics, the Caribou acquisition strategically include: Ditch Witch, Subsite Electron- Unilever and we look forward to working and gas producers in the enhances the company’s capabilities, ics, DW/TXS, HammerHead, Radius closely with the team to keep on inventing United States geographic reach and customer portfo- HDD, American Augers, Trencor and new healthy snacks, as well as continuing lio,” says Resonetics CEO Chip Hance. MTI. “The company expands our busi- to work to understand the role technology Thoma Bravo-backed Quorum Soft- “We believe that the recent acquisitions ness in a meaningful way in an adja- can play in improving the food industry.” ware is buying Coastal Flow Measure- combined with the company’s strong cent category we know well through “Accelerating our presence in healthy ment Inc., a provider of gas and liquids organic growth have established Reson- our own specialty construction business foods and out of home this is an excellent measurement, analytical services and etics as a leading supplier of specialized and in a market that is attractive given strategic fit for the Unilever food and re- software resources to the energy indus- componentry for interventional medical the potential for growth in addressing freshment business,” adds Nitin Paranjpe, try. Quorum offers software to about device companies.” GTCR invested in both aging infrastructure that is cur- president of Unilever’s food and refresh- 75 percent of the largest oil and gas Resonetics in 2018. Kirkland & Ellis and rently in place and new infrastructure ment business. producers in the U.S. PwC advised GTCR. that will be needed to support next “As the energy industry continues to generation technologies like 5G,” says develop the digital oilfield, our employ- Toro expands Toro CEO Richard Olson. ees and customers will recognize the Advisors to Toro include: J.P. Morgan benefits of a Quorum and Coastal Flow construction Securities LLC (NYSE: JPM), Fox Roths- combination to effectively deliver an equipment child and Latham & Watkins. Advisors integrated and comprehensive busi- to Charles Machine include McAfee ness process automation solution,” says business & Taft A Professional Corp. Financing Coastal Flow president Mark Fillman. for the deal is provided by: Bank of Toro is buying Charles America Merrill Lynch and J.P. Morgan Machine Works, a maker Chase Bank. GRAZE of excavators Buying healthy Food conglomerates are diversifying their product lines to appeal to consum- Agriculture and construction snack boxes ers who are opting for healthier snacks. In equipment maker Toro Co. (NYSE: 2018, the Hershey Co. (NYSE: HSY) bought TTC) is buying equipment manufac- Graze sells personalized Pirate Brands from B&G Foods Inc. (NYSE: turer Charles Machine Works Inc. for boxes that come with items BGS) for $420 million. In 2017, Conagra $700 million. The target produces such as nuts and trail mix Brands Inc. (NYSE: CAG) bought Angie’s horizontal directional drills, walk and Aritisan Treats, the owner Boomchicapop Companies are becoming more ride trenchers, utility loaders, vacuum popcorn brand, and Kellogg Co. (NYSE: K) efficient, and businesses are relying on excavators and asset locators for the Unilever is buying healthy snacks com- paid $600 million for nutrition bar maker data to improve their operations. Data infrastructure and construction sectors. pany Nature Delivered Ltd., also known as RXBar. Harris Williams is advising Graze. management, data virtualization and Charles Machine generated $725 mil- Graze, from the Carlyle Group (Nasdaq: artificial intelligence are among the lion in revenue in 2018. CG). Graze is one of the largest healthy software developments appealing to in- Some of Charles Machine’s brands snack brands in Europe. The company vestors. Earlier in 2019, Genstar Capital-

8 Mergers & Acquisitions April 2019 TheMiddleMarket.com

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sells personalized boxes that come with backed Drillinginfo bought Cortex, a Cortex’s technology allows for the items such as nuts and trail mix through Digitizing the software provider for the energy sector. automation of accounts payable and subscription delivery, as well as in retail energy sector companies. “Graze believes that learning from Uni- Thoma Bravo-backed lever’s sustainable living plan will become Quorum Software provides ® ® ® a key driver for the business,” says Graze tools to about 75 CEO Anthony Fletcher. “Graze has an incredibly exciting future ahead as part of percent of the largest oil Unilever and we look forward to working and gas producers in the closely with the team to keep on inventing United States new healthy snacks, as well as continuing to work to understand the role technology Thoma Bravo-backed Quorum Soft- can play in improving the food industry.” ware is buying Coastal Flow Measure- “Accelerating our presence in healthy ment Inc., a provider of gas and liquids foods and out of home this is an excellent measurement, analytical services and strategic fit for the Unilever food and re- software resources to the energy indus- freshment business,” adds Nitin Paranjpe, try. Quorum offers software to about president of Unilever’s food and refresh- 75 percent of the largest oil and gas ment business. producers in the U.S. “As the energy industry continues to develop the digital oilfield, our employees and customers will recognize the benefits of a Quorum and Coastal Flow combination to effectively deliver an integrated and comprehensive business process automation solution,” says Coastal Flow president Mark Fillman. GRAZE

Food conglomerates are diversifying their product lines to appeal to consumers who are opting for healthier snacks. In 2018, the Hershey Co. (NYSE: HSY) bought Pirate Brands from B&G Foods Inc. (NYSE:

BGS) for $420 million. In 2017, Conagra ADOBE STOCK Brands Inc. (NYSE: CAG) bought Angie’s Aritisan Treats, the owner Boomchicapop Companies are becoming more popcorn brand, and Kellogg Co. (NYSE: K) efficient, and businesses are relying on paid $600 million for nutrition bar maker data to improve their operations. Data RXBar. Harris Williams is advising Graze. management, data virtualization and artificial intelligence are among the software developments appealing to investors. Earlier in 2019, Genstar Capital-

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receivable processes for the oil and gas technology, media, marketing, informa- industry. Drillinginfo is a data analytics tion and services and healthcare sectors company for the energy sector. Advisors in the middle market. The target advised to Quorum include: Credit Suisse Securi- on more than 30 deals in 2018. “Our U.S. ties, Macquarie Capital and Kirkland & capital markets business has become an Ellis. Advisors to Coastal Flow include: increasingly stronger regional competi- PPHB Securities and Locke Lord LLP. tor, and this acquisition advances our Financing is being provided by: Credit priority of investing in areas of higher

Suisse, Macquarie Capital, PSP Invest- ADOBE STOCK margin potential, as we continue to ments Credit USA LLC and Angel Island food ordering company Grubhub Inc. position our company for increased sta- Capital. (NYSE: GRUB) agreed to buy LevelUp, a bility and long-term profitability,” says provider of payment processing tech- Canaccord Genuity CEO Dan Daviau. Mobile drives nology for restaurants, for $390 million “The addition of Petsky Prunier cre- CHANG’S P.F. in 2018. Advisors to ACI include: Bank ates an exceptional opportunity for growth in of America and Jones Day. Advisors our North American capital markets Centerbridge Partners. Centerbridge payments to Western Union include: Centerview business, while simultaneously enhanc- put P.F. Chang’s on the auction block in Partners and Sidley Austin. ing long-term value for our partners and 2018. P.F. Chang’s owns and franchises shareholders.” ACI is buying Western Mid-market Investment banks in the middle Union’s bill pay business, market have been consolidating. SVB Speedpay investment banks Financial Group (Nasdaq: SIVB) is buy- combine forces ing healthcare-focused Leerink Partners ACI Worldwide (Nasdaq: ACIW) for $280 million; Houlihan Lokey Inc. is buying Speedpay, Western Union (NYSE: HLI) bought BearTooth Advisors; Co.’s (NYSE: WU) U.S. bill pay business Petsky Prunier focuses on KeyBanc acquired Cain Brothers; and for $750 million. Speedpay provides the technology, media, B. Riley Financial Inc. (Nasdaq: RILY) electronic bill presentment and pay- marketing, information and bought FBR & Co. On the current deal, ment services. The target generated services and healthcare Freeman & Co. and Winston and Strawn about $350 million in revenue in 2018. sectors advised Petsky Prunier. Debevoise & ACI and Speedpay will serve more than Plimpton advised Canaccord Genuity. 4,000 customers in the U.S. across the Canaccord Genuity Group Inc. has consumer finance, insurance, healthcare, acquired middle-market investment higher education, utilities, government bank Petsky Prunier for up to $85 mil- Why investors like and mortgage sectors. lion. The deal underscores the buyer’s restaurants “This acquisition reinforces ACI’s ‘any commitment to adding scale to its fixed payment, every possibility’ vision and cost base in the U.S., diversifying its accelerates our ability to capitalize on revenue streams, enhancing client offer- Partnering with Paulson the growing global payment transaction ings to clients with the aim of capturing and TriArtisan will help opportunity over the next five years,” greater marketshare, the buyer said in a P.F. Chang’s implement says ACI CEO Phil Heasley. release. a “collaborative growth Consumer adoption of digital and Established in 1950, Canaccord is a strategy” mobile payments is driving growth full-service financial services firm, with in the U.S. bill pay sector. Cards and operations in two principal segments of cashless transactions are among the the securities industry: wealth manage- Paulson & Co. and TriArtisan Capital biggest growth drivers in the payments ment and capital markets Petsky Prunier Advisors LLC have bought restaurant industry, and that is driving M&A. Online was founded in 1999, and focuses on the chain P.F. Chang’s China Bistro Inc. from

10 Mergers & Acquisitions April 2019 TheMiddleMarket.com

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technology, media, marketing, informa- more than 300 Asian says P.F. Chang’s CEO Jim Bell. “Paulson tion and services and healthcare sectors restaurants glob- and TriArtisan bring financial strength in the middle market. The target advised ally. Its menu features and expertise that will allow us to grow on more than 30 deals in 2018. “Our U.S. items such as wok- our dine-in and off-premises channels capital markets business has become an fired filet mignon and both domestically and internationally.” increasingly stronger regional competi- miso glazed salmon. Restaurant chains and PE firms find tor, and this acquisition advances our Centerbridge bought it beneficial to partner with each other. priority of investing in areas of higher P.F. Chang’s in 2012 Restaurants get help funding growth, margin potential, as we continue to for $1.1 billion, and while generating cash for PE firms. The position our company for increased sta- separated the main latter has also provided investment for bility and long-term profitability,” says brand and Pei Wei large-scale brands. Canaccord Genuity CEO Dan Daviau. Asian Diner into two Advisors to P.F. Chang’s include: Bank

“The addition of Petsky Prunier cre- CHANG’S P.F. businesses. of America, Barclays and Weil, Got- ates an exceptional opportunity for “We are fortunate shal & Manges. Advisors to the buyers our North American capital markets Centerbridge Partners. Centerbridge to have a partnership with Paulson and include: Credit Suisse, Ropes & Gray LLP business, while simultaneously enhanc- put P.F. Chang’s on the auction block in TriArtisan which will allow us to imple- and Kleinberg, Kaplan, Wolff & Cohen. ing long-term value for our partners and 2018. P.F. Chang’s owns and franchises ment a collaborative growth strategy,” M&A shareholders.” Investment banks in the middle market have been consolidating. SVB Financial Group (Nasdaq: SIVB) is buying healthcare-focused Leerink Partners for $280 million; Houlihan Lokey Inc. (NYSE: HLI) bought BearTooth Advisors; KeyBanc acquired Cain Brothers; and B. Riley Financial Inc. (Nasdaq: RILY) bought FBR & Co. On the current deal, Freeman & Co. and Winston and Strawn advised Petsky Prunier. Debevoise & Plimpton advised Canaccord Genuity.

Why investors like restaurants

Partnering with Paulson and TriArtisan will help P.F. Chang’s implement a “collaborative growth strategy”

Paulson & Co. and TriArtisan Capital Advisors LLC have bought restaurant chain P.F. Chang’s China Bistro Inc. from

TheMiddleMarket.com April 2019 Mergers & Acquisitions 11

011_MAJ0419 11 3/11/2019 11:14:11 AM Private Equity Perspective

Genstar managing director Tony Salewski. As PE firms pursue innova- tions that will drive sustainable value, technology will continue to fuel M&A. Expect to see more deals coming from a wide array of exciting new developments, including: artificial intelligence, data management, data virtualization, digital marketing, healthcare IT, industrial

ADOBE STOCK automation, the Internet of Things, machine-to-machine learning, payment process- Expect more tech ing, Software-as-a-Service and enterprise software. Private equity firms are raising money to back tech companies, The BDO survey, which and tech is infusing dealmaking at all levels consisted of telephone interviews with 100 U.S. tech By Mary Kathleen Flynn CFOs, asked some key ques- tions: “Will the U.S. tech sector—one of the S&P 500’s Technology permeates dealmaking today. in the deal, each investing new equity to leading performers in 2017 “Tech is, more or less, touching everything,” acquire Aptean from the separate Vista fund and last year—continue to as the authors of The 2019 BDO Technology that initially invested in the company in 2012. ride the wave of enthusiasm Outlook Survey put it. TA and Vista were among 10 PE firms to generate exponential You can see the impact of tech through- active in tech deals that Mergers & Acquisi- growth? Or will it face an out the 2018 winners of Mergers & Acquisi- tions recently profiled. Also on that list was economic slowdown?” The tions’ M&A Mid-Market Awards featured Genstar Capital, which recently closed its answers were mixed. in this issue, especially: Luminate Capital ninth fund at around $7 billion. The fund has “While the U.S. economy Partners founder Hollie Hayne’s scoring raised $5.5 billion in limited partner com- remains strong, trade wars, Dealmaker of the Year for raising a second mitments, $1.1 billion in overage capacity tax reform, data pri- fund to invest in enterprise software com- and $400 million from general partners and vacy concerns, and other panies; and TA Associates’ winning Private affiliated entities. geopolitical tensions and Equity Firm of the Year for investing a record San Francisco-based Genstar has about policy changes threaten to $2.8 billion in new portfolio companies, most $17 billion in assets, focusing on the finan- shake up the sector,” wrote of which are infused with technology one cial services, industrial technology, health- the authors. “Meanwhile, way or the other. care and software sectors. Earlier in 2019, increasing competition at Among the many recent tech-related Genstar-backed Drillinginfo bought Cortex, home and abroad, along announcements that caught our eye was a software provider for the energy sector. with evolving customer TA Associates and Vista Equity Partners’ “We believe that our thesis-driven invest- expectations, make innovat- investment in Aptean, an enterprise soft- ing model of growing and building industry ing and scaling up quickly ware developer focused on manufacturing leading businesses will continue to deliver and sustainably an absolute customers. TA and Vista are equal partners superior performance for our investors,” said imperative.” M&A

12 Mergers & Acquisitions April 2019

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PCP_001_2019_MA_v1FA.indd013_MAJ0419 13 2 3/7/20192/28/19 1:11:03 9:23 PM AM The Buyside

shoppers. Nike has bolstered its digital capabilities with Sizing up the right deal the acquisition of Invertex Ltd. The target uses 3D Shoe companies are making investments that will set them up technology and mobile for the future, while gaining new customers applications to analyze consumer buying behavior, By Demitri Diakantonis aiming to provide retailers with information to customize products to meet specific The way consum- presence, while it grows its global operations. customer needs. Among its ers shop continues The target operates under the Goat and offerings, Invertex uses an to change. Custom- Flight Club brands. in-store mat that shop- ers want to put “At Foot Locker we are constantly looking pers stand on to get precise their own touch on at new ways to elevate our customer experi- measurements to help them products, not wait ence and bring sneaker and youth culture to choose shoes that fit. “The too long for them people around the world,” Johnson says. “To- acquisition of Invertex will and in most cases, gether, Foot Locker and Goat Group’s shared deepen our bench of digital never step foot in a commitment to trust and authenticity in the talent and further our ca- store to buy them. sneaker industry will provide consumers with pabilities in computer vision Apparel and sneaker unparalleled experiences and diversified and artificial intelligence, as retailers, such as Foot Locker (NYSE: FL) and offerings.” Goat and Rockets of Awesome we create the most compel- Nike Inc. (NYSE: NKE), are embracing these follow a recent string of investments for Foot ling Nike consumer experi- challenges by snatching up companies that Locker including: women’s luxury activewear ence at every touchpoint,” can provide customized products to custom- brand Carbon38, children’s lifestyle brand says Adam Sussman, Nike’s ers, and advancing digital capabilities to Super Heroic and footwear design academy chief digital officer. Nike won businesses. Pensole. Mergers & Acquisitions’ 2019 In 2018, Foot Locker Inc. acquired a mi- Nike Inc. is also making deals that will Strategic Buyer of the Year nority stake in children’s apparel company help the company cater to the next wave of for Zodiac and Invertex. M&A Rockets of Awesome for $12.5 million. The target simplifies the way parents shop by delivering high-quality, on-trend, handpicked pieces directly to customers. The investment is part of Foot Locker’s strategy to diversify its customers and products offerings. “Rockets of Awesome is advancing the way parents shop for their kids and Foot Locker is committed to evolving with the ever-changing retail landscape and adjust- ing to the speed of our customers,” said Richard Johnson, Foot Locker CEO, when the deal was announced. Foot Locker Inc. is also buying a minor- ity stake in secondary sneaker retailer Goat Group for $100 million. The investment will

expand Goat’s online and brick-and-mortar BLOOMBERG NEWS

14 Mergers & Acquisitions April 2019

014_MAJ0419 14 3/11/2019 11:24:19 AM LEADING FIGURES IN MERGERS & ACQUISITIONS

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Visit today at themiddlemarket.com/video

015_MAJ0419d30734_MA_RRD_HouseAd_REV.indd 15 1 3/7/20196/28/17 1:11:04 11:47 PMAM Excelled. Innovated. Inspired. That’s what the eight winners of Mergers & Acquisitions’ Deal of the Year Fortive M&A Mid-Market Awards did in 2018. Our awards honor the leading dealmakers and deals Dealmaker of the Year Hollie Haynes that set the standard for transactions in the middle market. Private Equity Firm of the Year TA Associates This year’s winners include: Hollie Haynes, who took home Dealmaker of the Year for Private Equity Seller of the Year Riverside raising a second fund for Luminate Capital Partners, the tech-focused PE firm she Strategic Buyer of the Year Nike founded after leaving Silver Lake; TA Associates, which won Private Equity Firm of the Year Investment Bank of the Year Harris Williams for growing significantly as the firm celebrated its 50th anniversary, and completed its Lender of the Year Monroe Capital 500th transaction; Fortive, which scored Deal of the Year for its $775 million acquisition of Gordian, a provider of construction cost data, software, and services, in a transformative Law Firm of the Year Goodwin deal for the construction industry as a whole; and Nike, which was named Strategic Buyer of the Year, for buying Zodiac and Invertex, a pair of innovative digital startups helping the athletic apparel maker get closer to customers.

016_MAJ0419 16 3/11/2019 11:15:17 AM 12th Annual M&A Mid-Market Awards

Excelled. Innovated. Inspired. That’s what the eight winners of Mergers & Acquisitions’ M&A Mid-Market Awards did in 2018. Our awards honor the leading dealmakers and deals that set the standard for transactions in the middle market.

This year’s winners include: Hollie Haynes, who took home Dealmaker of the Year for raising a second fund for Luminate Capital Partners, the tech-focused PE firm she founded after leaving Silver Lake; TA Associates, which won Private Equity Firm of the Year for growing significantly as the firm celebrated its 50th anniversary, and completed its 500th transaction; Fortive, which scored Deal of the Year for its $775 million acquisition of Gordian, a provider of construction cost data, software, and services, in a transformative deal for the construction industry as a whole; and Nike, which was named Strategic Buyer of the Year, for buying Zodiac and Invertex, a pair of innovative digital startups helping the athletic apparel maker get closer to customers.

By Mary Kathleen Flynn, Demitri Diakantonis and Danielle Fugazy

017_MAJ0419 17 3/11/2019 11:15:17 AM Deal of the Year Dealmaker of the Year Fortive’s Gordian deal brought efficiency Hollie Haynes took Luminate Capital to the antiquated construction industry Partners to the next level

Forged transformative deal gains that software and data can deliver, and the adoption of software platforms is reaching an inflection point. Fortive Corp.’s $775 million acquisition of Gordian, a “In addition to the generational shift that is occurring as privately-held provider of construction cost data, software more millennials and other digital natives ascend the ranks and services, from Warburg Pincus LLC, was a transforma- at contractors and project owners, several construction tive deal for Fortive (NYSE: FTV) and for the construction technology platforms have now reached a scale at which industry as a whole. Gordian provides construction cost the data they collect provides immensely valuable informa- data and software that enables owners and operators to tion to constituents across the construction ecosystem,” manage the entire construction continuum, from design said Peter Dalrymple, managing director, William Blair. “The and build, to manage and operate. “Gordian’s over 70 years growth and maturation of software and analytics platforms, of proprietary construction cost data and domain expertise such as Gordian’s, are bringing much-needed efficiency to and a seasoned management team created the industry the construction ecosystem.” standard in construction task data, workflow software and service,” Fortive CEO James Lico said when the deal was announced in July. Construction is ripe for the productivity gains software

Completed deals can deliver.

▶▶ There have been 7 major acquisitions of Construction software consolidates Solidified firm’s leadership construction software companies by multiple in software players since the end of 2017 A diversified industrial growth company comprised of In raising Luminate Capital Partners’ second fund with $425 professional instrumentation and industrial technologies million of capital in 2018, Hollie Haynes secured the technol- ▶▶ Fortive bought Gordian and Accruent businesses with 2017 revenues of $6.7 billion, Fortive is ogy-focused private equity firm’s position as a consummate actively acquiring technology companies that use software, investor in middle-market enterprise software companies. ▶▶ Oracle bought Aconex data analytics, and other elements of the industrial Internet The San Francisco firm, which Haynes founded in 2014 after a of Things, or IoT, to drive efficiency in large, complex end successful 15 years at technology investing powerhouse Silver ▶▶ Trimble acquired e-Builder and Viewpoint markets. Lake, has completed nine deals and delivered one exit and Soon after snatching up Gordian, Fortive bought Accruent, two recapitalizations to date. As the firm’s leader, Haynes ▶▶ Autodesk bought PlanGrid and which develops software used to manage real estate, facili- works on deals, but also spends a lot time talking with inves- BuildingConnected ties, and other assets, from Genstar Capital, for $2 billion. tors and management teams, in addition to handling firm Under Genstar’s two-year ownership, Accruent doubled issues like financials, tax and IT. “We believe we have earned revenue, completed nine acquisitions and expanded inter- the right to take a leading position in our sector of the mar- nationally, according to the tech-focused private equity ket,” Haynes said in an interview. Digital disruption to the rescue firm. Combining Gordian and Accruent with Fortive’s Fluke Digital Systems created an IoT portfolio, consisting of con- With a total addressable market of $20 billion and mas- nected devices, software-enabled workflows, and data ana- sive scale globally, the construction software sector is Enterprise software: the gift that lytics. Gordian’s procurement data and Accruent’s facilities extremely attractive but plagued by antiquated, paper- and keeps on giving management data give owners and contractors enviable spreadsheet-based systems, according to investment bank Luminate backs middle-market software companies — those insight into the full real estate life cycle. William Blair, which advised Gordian on the sale to Fortive. with $10 million to $50 million in annual revenues — from As such, the construction industry is ripe for the productivity founders, early venture capital investors or carve-out deals.

18 Mergers & Acquisitions April 2019 TheMiddleMarket.com

018_MAJ0419 18 3/11/2019 11:15:20 AM Deal of the Year Dealmaker of the Year Fortive’s Gordian deal brought efficiency Hollie Haynes took Luminate Capital to the antiquated construction industry Partners to the next level

gains that software and data can deliver, and the adop- From its inception, the firm has focused on growth buyouts in tion of software platforms is reaching an inflection point. enterprise software, a sector that has been growing in popu- “In addition to the generational shift that is occurring as larity with investors and dealmakers for good reason. “The more millennials and other digital natives ascend the ranks enterprise software business model is hard to beat,” Haynes at contractors and project owners, several construction explained. “The businesses usually have recurring revenue, technology platforms have now reached a scale at which strong growth and good cash flow. And there are an endless the data they collect provides immensely valuable informa- number of problems to solve for enterprise customers. Build- tion to constituents across the construction ecosystem,” ing an enterprise-scale software company is outrageously said Peter Dalrymple, managing director, William Blair. “The hard. This sector is not for the faint of heart. But the rewards growth and maturation of software and analytics platforms, to success can be tremendous.” such as Gordian’s, are bringing much-needed efficiency to the construction ecosystem.” Vote of confidence from LPs The firm’s inaugural fund was closed in 2017 with more than Construction is ripe for the $265 million in capital commitments. The successful raising productivity gains software of the sophomore fund, which was bigger and brought in new limited partners, is a testament to the firm’s strategy and can deliver. acumen. “With this second fundraise, we had very strong support from our Fund I investors and validation of our invest- Construction software consolidates Solidified firm’s leadership ment thesis,” says Haynes. “Investors are seeing us refine our in software investment thesis. They have gotten more clarity around how A diversified industrial growth company comprised of Luminate operates, and we now have a stronger platform In raising Luminate Capital Partners’ second fund with $425 professional instrumentation and industrial technologies from which to invest.” million of capital in 2018, Hollie Haynes secured the technol- businesses with 2017 revenues of $6.7 billion, Fortive is ogy-focused private equity firm’s position as a consummate actively acquiring technology companies that use software, investor in middle-market enterprise software companies. data analytics, and other elements of the industrial Internet Completed deals The San Francisco firm, which Haynes founded in 2014 after a of Things, or IoT, to drive efficiency in large, complex end successful 15 years at technology investing powerhouse Silver markets. ▶▶ Invested in AutoQuotes, a technology Lake, has completed nine deals and delivered one exit and company in the foodservice industry Soon after snatching up Gordian, Fortive bought Accruent, two recapitalizations to date. As the firm’s leader, Haynes which develops software used to manage real estate, facili- works on deals, but also spends a lot time talking with inves- ▶▶ Supported the add-on acquisition of ties, and other assets, from Genstar Capital, for $2 billion. tors and management teams, in addition to handling firm NetFacilities by portfolio company AMTdirect Under Genstar’s two-year ownership, Accruent doubled issues like financials, tax and IT. “We believe we have earned LLC, an accounting software developer revenue, completed nine acquisitions and expanded inter- the right to take a leading position in our sector of the mar- nationally, according to the tech-focused private equity ket,” Haynes said in an interview. ▶▶ Invested in Conexiom, a developer of firm. Combining Gordian and Accruent with Fortive’s Fluke cloud-based supply chain document Digital Systems created an IoT portfolio, consisting of con- automation software nected devices, software-enabled workflows, and data ana- Enterprise software: the gift that lytics. Gordian’s procurement data and Accruent’s facilities keeps on giving ▶▶ Reinvested in Financial Information management data give owners and contractors enviable Luminate backs middle-market software companies — those Technologies, a payment software developer insight into the full real estate life cycle. with $10 million to $50 million in annual revenues — from for the beverage alcohol industry founders, early venture capital investors or carve-out deals.

TheMiddleMarket.com April 2019 Mergers & Acquisitions 19

019_MAJ0419 19 3/11/2019 11:15:21 AM Private Equity Firm of the Year Private Equity Seller of the Year TA Associates delivered a record year, The Riverside Co. delivered an impressive as the firm celebrated turning 50 16 exits, as the firm celebrated turning 30

Marked milestones Fostered inclusion Stellar year In 2018, TA invested a record $2.8 billion in new portfolio TA formed a strategic partnership with Athena Alliance, a Always a prolific seller, the Riverside Co. excelled in 2018 companies (more than double the $1.3 billion the firm non-profit organization dedicated to helping more women when it came to the total number of exits and the increase invested the previous year), celebrated its 50th anniversary attain board seats. TA says it is the first private equity sponsor in value they represented. The firm, based in Cleveland and and completed its 500th investment. Based in Boston and to work with the group. Through the partnership, TA As- New York, completed 16 exits, including three of the top five Menlo Park, California, TA is currently investing out of its sociates’ portfolio companies have the opportunity to offer exits in its history, in terms of proceeds for investors. 12th flagship fund, which closed on a reported $5.3 billion in their senior women leaders access to personal development Marking its 30th anniversary, the firm enjoyed growth in 2015. New investments were made in 17 companies across coaching from the organization to prepare them for a board other areas as well, making 60 investments, compared with the globe, compared with 14 the previous year. The firm director role. In addition, TA will seek to leverage Athena’s 44 the previous year, and delivering a record fundraising achieved $3.1 billion in liquidity through numerous exits (both network of female leaders to help strengthen and diversify year, raising more than $2.1 billion. Riverside’s Micro-Cap full and partial), initial public offerings and recapitalizations. the boardrooms of the PE firm’s portfolio companies around Fund V hit its hard cap of $1.2 billion in capital commit- Internally, TA was active on the hiring front, and a significant the world. ments in less than four months, with demand exceeding the number of staff achieved promotions. hard cap by more than 50 percent. The partnership with Completed deals Athena Alliance is designed Completed deals ▶▶ Invested in Global Software Inc. and to help more women attain ▶▶ Sold Dwyer to Harvest Partners, increasing combined it with Insightsoftware.com Dwyer’s Ebitda more than 125 percent during International, with the aim of creating a board seats. Riverside’s hold, according to the firm world-class ERP reporting and corporate performance management company under Nurtured portfolio companies ▶▶ Sold Tate’s to Mondelez Global LLC (NASDAQ: the name Insightsoftware The firm engaged with more than 60 of its active portfolio MDLZ) for approximately $500 million; Tate’s saw sales and earnings increase 4x during the companies in a variety of initiatives, including sourcing accre- ▶▶ Invested in Merian Global Investors, the last five years tive acquisitions and new talent, managing and negotiating rebranded single-strategy asset management capital raisings and launching revenue growth and perfor- business of Old Mutual Global Investors mance improvement projects. Some stats that demonstrate ▶▶ Sold Alchemy to Intertek ITRK (LON: ITRK). Grew revenue from less than $15 million to TA’s active support of portfolio companies include: 66 accre- ▶▶ Sold Amplify Snack Brands (NYSE: BETR), in $60 million during hold period and Ebitda tive acquisitions, of which more than 40 percent were sourced which TA invested in 2014 and which com- from $2 million to over $19 million by TA; 79 senior management hires, of which nearly 30 per- pleted its IPO in 2015, to The Hershey Co. cent were sourced by TA; 37 new independent board member (NYSE: HSY) for $1.6 billion appointments, of which more than one-third were sourced by TA; 78 financings; numerous revenue growth and perfor- ▶▶ MAV Beauty Brands, a global personal care Nurtured portfolio companies mance improvement projects, such as the redesign of sales company in Canada in which TA invested in engines, pricing optimization studies, integration of adjacent 2016, completed its IPO on the Toronto Stock With more than $8 billion in assets under management, market products, expansion into new geographic markets and Exchange (TSX: MAV) Riverside closes investments efficiently, then partners streamlining decision-making processes. with management to drive sales and earnings growth. After making almost 600 investments, Riverside provides portfolio companies with deep experience and talent in seven industry specializations: specialty manufacturing and

20 Mergers & Acquisitions April 2019 TheMiddleMarket.com

020_MAJ0419 20 3/11/2019 11:15:22 AM Private Equity Firm of the Year Private Equity Seller of the Year TA Associates delivered a record year, The Riverside Co. delivered an impressive as the firm celebrated turning 50 16 exits, as the firm celebrated turning 30

Fostered inclusion Stellar year distribution; business services; consumer brands; education and training; franchisors; healthcare; and software and TA formed a strategic partnership with Athena Alliance, a Always a prolific seller, the Riverside Co. excelled in 2018 information technology. non-profit organization dedicated to helping more women when it came to the total number of exits and the increase Riverside nurtures its portfolio companies at the yearly Riv- attain board seats. TA says it is the first private equity sponsor in value they represented. The firm, based in Cleveland and erside Leadership Summit. The event connects key portfolio to work with the group. Through the partnership, TA As- New York, completed 16 exits, including three of the top five company executives with Riverside leaders and advisors sociates’ portfolio companies have the opportunity to offer exits in its history, in terms of proceeds for investors. from around the world at a private gathering designed to their senior women leaders access to personal development Marking its 30th anniversary, the firm enjoyed growth in inspire and accelerate growth. The RLS aims to coaching from the organization to prepare them for a board other areas as well, making 60 investments, compared with deliver: “unparalleled networking opportuni- director role. In addition, TA will seek to leverage Athena’s 44 the previous year, and delivering a record fundraising ties; dynamic, thought-provoking keynotes; network of female leaders to help strengthen and diversify year, raising more than $2.1 billion. Riverside’s Micro-Cap and engaging workshops with immediate the boardrooms of the PE firm’s portfolio companies around Fund V hit its hard cap of $1.2 billion in capital commit- takeaways,” according to the firm. the world. ments in less than four months, with demand exceeding the hard cap by more than 50 percent. Advocated for private equity Completed deals Riverside takes pride in its role as an advocate for the good it says private equity delivers to the economy, companies, customers and their employ- ▶▶ Sold Dwyer to Harvest Partners, increasing ees. The firm takes part in visits to Capitol Hill, deliv- Dwyer’s Ebitda more than 125 percent during ers columns, editorials and speeches touting the effec- Riverside’s hold, according to the firm tiveness of private equity, and has many team members serving in advocacy roles at industry organizations. ▶▶ Sold Tate’s to Mondelez Global LLC (NASDAQ: MDLZ) for approximately $500 million; Tate’s saw sales and earnings increase 4x during the Contributing to the last five years community has been a ▶▶ Sold Alchemy to Intertek ITRK (LON: ITRK). hallmark of the firm since Grew revenue from less than $15 million to $60 million during hold period and Ebitda inception. from $2 million to over $19 million Gave back Contributing to the community has been a hallmark of Nurtured portfolio companies Riverside since the firm’s inception. Two years ago, the firm formally launched its Global Volunteer Program, which With more than $8 billion in assets under management, Mergers & Acquisitions featured in our story, The Big Give, Riverside closes investments efficiently, then partners back in December. Riverside selects specific charities to with management to drive sales and earnings growth. support, based on employee recommendations while taking After making almost 600 investments, Riverside provides environmental, social and governance, or ESG, issues into portfolio companies with deep experience and talent in account. seven industry specializations: specialty manufacturing and

TheMiddleMarket.com April 2019 Mergers & Acquisitions 21

021_MAJ0419 21 3/11/2019 11:15:24 AM Strategic Buyer of the Year Investment Bank of the Year Nike bought a pair of digital innovators Harris Williams advised on more to deepen customer relationships deals than ever before

Accelerated digital transformation Zodiac acquisition helped with this initiative by targeting Broke records customers with a more personalized experience. While not particularly active on the acquisition front Harris Williams completed 87 transactions in 2018, the most traditionally, in 2018, Nike Inc. (NYSE: NKE) acquired two in firm history, up more than 22 percent from two years prior, innovative companies in order to help speed up the athletic If the shoe fits according to the firm. The year’s aggregate sell-side transac- apparel maker’s digital strategy. In March, Nike bought tion value of more than $31 billion topped the year prior by Founded in 2014 under the name Platform Orthopedic Zodiac Inc., a consumer data analytics firm based in New more than 28 percent and exceeded 2016’s total aggregate Solutions, Invertex originally used 3D scanning to cre- York and Philadelphia. And then in April, Nike bought transaction value by more than 50 percent. The Richmond, ate customized medical equipment, such as orthotics and Invertex Ltd., a Tel Aviv, Israel-based pioneer in the use of Virginia, firm experienced strong momentum with strategic braces. The startup evolved to produce products for retail- 3D scanning technology to customize shoes. “We’re adding and financial buyers located across the U.S., Europe and ers, including an in-store mat that shoppers stand on to get world-class data-science talent and best-in-class Asia; more than 20 percent of the firm’s clients were private- precise measurements to help them choose shoes that fit. tools to power 1:1 relationships with consumers ly-held companies. Harris Williams completed the most buy- “The acquisition of Invertex will deepen our bench of digital through digital and physical consumer side transactions in firm history, a 56 percent increase from talent and further our capabilities in computer vision and experiences,” Nike chief digital officer Adam 2017. The firm hired 97 full-time employees in 2018 for a total artificial intelligence, as we create the most compelling Nike Sussman told investors on an earnings call in of 315 employees at the end of the year and welcomed the consumer experience at every touch point,” said Sussman. March 2018. largest analyst and associate classes in firm history.

Retailers and apparel makers are under increasing pressure to get a better grasp of Completed deals The firm has pledged to shopping behavior and patterns, so they can tailor their marketing strategies and inventories to uphold the characteristics ▶▶ Purchased Zodiac Inc., a consumer data meet evolving consumer needs. “What really powers analytics firm, in March 2018 that make it exceptional. all these immersive consumer experiences is great data and the ability to maximize,” said Nike CEO Mark ▶▶ Bought Invertex Ltd., which uses 3-D Parker. “And while we’re constantly building these skills technology and mobile applications to Identified differentiators in-house we’re also acquiring capabilities to accelerate our analyze consumer buying behavior, The firm embarked on an initiative to identify differentiating strategy.” in April 2018 strengths and priorities for the future, including conducting external research among former and potential clients. Predictive analytics Through the process, Harris Williams affirmed long-held as- sumptions and identified priorities for future strategies. Since Zodiac uses data models, customer analytics, and behav- Responsive retail its founding in 1991, Harris Williams says it “has been devoted ioral analysis to predict the future behaviors of individuals. “Nike’s ambitious digital transformation is driving strong to execution excellence, fostering longstanding relation- “The acquisition of Zodiac demonstrates our commitment results and momentum in North America and in our ships, and acting as a thoughtful partner to clients. The firm’s to further accelerating Nike’s digital transformation and international geographies,” Parker said in a December unique approach ensures that our clients benefit from our enhancing our consumer data and analytics capabilities earnings call about the company’s fiscal 2019 second collective expertise, acting as one firm to provide guidance to help us serve consumers globally,” said Sussman. Past quarter. Nike reported a 13 percent increase in diluted that is specifically tailored to achieve the right results, the aspects of the strategy included Nike’s 2017 relaunch of the earnings per share, driven by double-digit revenue growth, right way.” The firm launched a new graphic identity, includ- NikePlus membership app, which provides a customized gross margin expansion and a lower average share count, ing a new logo. “With a renewed sense of Harris Williams’ selection for shoppers and which gathers customer data to partially offset by higher selling and administrative differentiators, the firm has entered 2019 with a path filled help Nike tailor products more effectively. The app allows expenses and a higher effective tax rate. “We’re incredibly with growth and a pledge to upholding the characteristics Nike to learn which sports and styles shoppers prefer, how energized about 2019 – with a full innovation pipeline; the that make the firm exceptional.” active they are, and give them style tips. It also gives Nike most personal, responsive retail experiences in the industry; a chance to connect with customers more directly. The and a supply chain that’s delivering speed at scale.”

22 Mergers & Acquisitions April 2019 TheMiddleMarket.com

022_MAJ0419 22 3/11/2019 11:15:26 AM Strategic Buyer of the Year Investment Bank of the Year Nike bought a pair of digital innovators Harris Williams advised on more to deepen customer relationships deals than ever before

Zodiac acquisition helped with this initiative by targeting Broke records customers with a more personalized experience. Harris Williams completed 87 transactions in 2018, the most Completed deals in firm history, up more than 22 percent from two years prior, If the shoe fits according to the firm. The year’s aggregate sell-side transac- ▶▶ Advised Jet Parts, a provider of parts and tion value of more than $31 billion topped the year prior by Founded in 2014 under the name Platform Orthopedic repair services to the commercial aerospace more than 28 percent and exceeded 2016’s total aggregate Solutions, Invertex originally used 3D scanning to cre- industry, on recapitalization by Vance Street transaction value by more than 50 percent. The Richmond, ate customized medical equipment, such as orthotics and Capital Virginia, firm experienced strong momentum with strategic braces. The startup evolved to produce products for retail- and financial buyers located across the U.S., Europe and ers, including an in-store mat that shoppers stand on to get ▶▶ Advised SRS Distribution, a distributor of Asia; more than 20 percent of the firm’s clients were private- precise measurements to help them choose shoes that fit. roofing supplies and related materials, on ly-held companies. Harris Williams completed the most buy- “The acquisition of Invertex will deepen our bench of digital sale to Leonard Green & Partners side transactions in firm history, a 56 percent increase from talent and further our capabilities in computer vision and 2017. The firm hired 97 full-time employees in 2018 for a total artificial intelligence, as we create the most compelling Nike ▶▶ Advised SlimFast, a brand of weight manage- of 315 employees at the end of the year and welcomed the consumer experience at every touch point,” said Sussman. ment and meal replacement products, on largest analyst and associate classes in firm history. sale to Glanbia, a global nutrition company based in Kilkenny, Ireland The firm has pledged to ▶▶ Advised Premise Health, a provider of on-site uphold the characteristics health clinics, on sale to Omers Private Equity that make it exceptional. in Toronto

Identified differentiators Embraced diversity The firm embarked on an initiative to identify differentiating Over the last several years, Harris Williams has dedicated strengths and priorities for the future, including conduct- resources to increase diversity at the firm, including an ing external research among former and potential clients. annual women’s leadership summit, which brings together Through the process, Harris Williams affirmed long-held as- undergraduate and MBA students for a day of panels, break- Responsive retail sumptions and identified priorities for future strategies. Since out sessions and networking. Harris Williams’ 2018 analyst its founding in 1991, Harris Williams says it “has been devoted and associate class saw a shift in the female/male makeup, “Nike’s ambitious digital transformation is driving strong to execution excellence, fostering longstanding relation- and the firm currently has the highest percentage of analyst results and momentum in North America and in our ships, and acting as a thoughtful partner to clients. The firm’s and associate women in its history. In 2018, the firm held its international geographies,” Parker said in a December unique approach ensures that our clients benefit from our first veterans’ summit. The firm says it is proud to have all earnings call about the company’s fiscal 2019 second collective expertise, acting as one firm to provide guidance five branches of the U.S. Armed forces represented in the quarter. Nike reported a 13 percent increase in diluted that is specifically tailored to achieve the right results, the employee base. In 2018, Harris Williams joined Consortium, earnings per share, driven by double-digit revenue growth, right way.” The firm launched a new graphic identity, includ- the nation’s largest diversity network that brings together gross margin expansion and a lower average share count, ing a new logo. “With a renewed sense of Harris Williams’ students in top-tier MBA programs and corporate partners. partially offset by higher selling and administrative differentiators, the firm has entered 2019 with a path filled expenses and a higher effective tax rate. “We’re incredibly with growth and a pledge to upholding the characteristics energized about 2019 – with a full innovation pipeline; the that make the firm exceptional.” most personal, responsive retail experiences in the industry; and a supply chain that’s delivering speed at scale.”

TheMiddleMarket.com April 2019 Mergers & Acquisitions 23

023_MAJ0419 23 3/11/2019 11:15:26 AM Lender of the Year Law Firm of the Year Monroe Capital grew significantly, including Goodwin grew, especially in practice areas a 35 percent increase in AUM where innovation meets capital

Growth streak Delivered a banner year Record revenue and profits Monroe Capital LLC has enjoyed impressive growth over the In 2018, the firm’s AUM soared by $1.8 billion, or 35 percent, In 2018, Goodwin grew by double digits across key financial last five years, continuing the upward trajectory in 2018. The over the previous year. Monroe funded a firm record of 72 di- metrics, marking the firm’s sixth consecutive year of record Chicago lender has increased its AUM at a compound annual rect middle-market transactions, with fundings totaling over revenue and profits. Technology-rich practice areas drove growth rate of 38 percent over five years, bringing the total $2.5 billion, solidifying the firm’s focus on businesses with $5 this growth: The firm’s private equity and life sciences prac- to $7 billion, up from $1.9 billion in 2014. The firm has also ex- million to $50 million of Ebitda. tices both grew revenues by 31 percent; technology revenues panded significantly when it comes to employees and offices, were up 18 percent; and real estate revenues were up 17 Monroe grew private credit funds and CLOs by 35 percent, the number of limited partners with worldwide coverage and percent. Goodwin’s headcount growth for these practices has closing three new funds. The firm’s BDC issued $69 million loan volume and dollars deployed. soared over the past five years, with the life sciences practice in senior secured notes, also called baby bonds. Monroe increasing its headcount by 500 percent to 100-plus lawyers, Founded in 2004, Monroe is a private credit asset manage- brought in 43 new institutional limited partner investors, in- the private equity practice by 350 percent to more than 250 ment firm that specializes in direct lending and opportunistic cluding 11 that are based outside the U.S., with representation lawyers and the technology companies practice by 257 per- private credit investing. The firm’s offerings provide senior from Australia, Japan, Peru, Norway and Israel. Monroe has cent to more than 200 lawyers. and junior debt financing to businesses, special situation bor- also increased its workforce, growing the number of employ- rowers and private equity sponsors. Investment types include ees 20 percent over the last five years, including a 23 percent unitranche financings; cash flow, asset-based and enterprise boost in 2018, bringing the total to just over 100 employees. value-based loans; and equity co-investments. The firm cur- Completed deals rently invests out of 19 funds, comprised of small business investment company (SBIC) funds, institutional private credit With more than 25 years of ▶▶ Represented Kensho Technologies Inc., funds, separate managed accounts, a publicly-listed business experience, CEO Ted Koenig which Goodwin represented Kensho Technol- development company (BDC), and collateralized loan obliga- ogies Inc., a developer of artificial intelligence tions (CLO) vehicles. is highly regarded. founded out of MIT and Harvard University in 2013, in its sale to S&P Global (NYSE: SPGI) for Served independent sponsors an aggregate purchase price of $550 million Completed deals Reflecting the rise of investors who work on deals one by one, ▶▶ Advised Primus Capital in its sale of Hyper- ▶▶ Served as agent on the funding of an instead of through a private equity fund, Monroe launched a wallet, a Primus portfolio company that helps $80 million senior credit facility to support new Independent Sponsor vertical. This vertical was estab- individuals and small firms receive payments AN Global’s acquisition of 4th Source Inc. lished to support the growing number of fundless sponsors for goods and services that they sell on online AN Global is owned by management, Nexxus seeking a total financing solution that includes both debt marketplaces, to PayPal for $400 million in Capital and Credit Suisse Asset Management and equity. The Independent Sponsor vertical closed three cash transactions with $122 million funded in 2018. ▶▶ Served as agent on the funding of a $32.7 ▶▶ Advised WisdomTree Investments Inc. in million credit facility to support the recapital- Solidified thought leadership role its acquisition of ETF Securities’ European ization of S&S HealthCare Strategies Ltd. by exchange-traded commodity, currency and independent sponsor Level Capital Partners. With more than 25 years of experience, CEO Ted Koenig is a short-and-leveraged business, for cash and Monroe provided an equity co-investment highly regarded thought leader in middle-market lending. In stock valuing the target at $523 million to partner with the management team in its 2018, the firm launched the inaugural Chicago Middle Market buyout Business Conference, featuring panelists from the city’s top private equity firms, investment banks, and law firms. More than 600 professionals attended.Labo.

24 Mergers & Acquisitions April 2019 TheMiddleMarket.com

024_MAJ0419 24 3/11/2019 11:15:27 AM Lender of the Year Law Firm of the Year Monroe Capital grew significantly, including Goodwin grew, especially in practice areas a 35 percent increase in AUM where innovation meets capital

Delivered a banner year Record revenue and profits All deals are tech deals today In 2018, the firm’s AUM soared by $1.8 billion, or 35 percent, In 2018, Goodwin grew by double digits across key financial The law firm prides itself on sitting “at the intersection of over the previous year. Monroe funded a firm record of 72 di- metrics, marking the firm’s sixth consecutive year of record capital and innovation.” As a firm representative put it, “In to- rect middle-market transactions, with fundings totaling over revenue and profits. Technology-rich practice areas drove day’s technology-driven economy, every company, even one $2.5 billion, solidifying the firm’s focus on businesses with $5 this growth: The firm’s private equity and life sciences prac- not selling ‘technology,’ is significantly technology-enabled million to $50 million of Ebitda. tices both grew revenues by 31 percent; technology revenues and dependent. From an investor perspective, it is no longer were up 18 percent; and real estate revenues were up 17 sufficient to simply understand how to execute a venture or a Monroe grew private credit funds and CLOs by 35 percent, percent. Goodwin’s headcount growth for these practices has private equity deal. Rather, investors are looking for lawyers closing three new funds. The firm’s BDC issued $69 million soared over the past five years, with the life sciences practice who understand technology and how it impacts the viability in senior secured notes, also called baby bonds. Monroe increasing its headcount by 500 percent to 100-plus lawyers, of a target investment. In other words, there’s an ongoing brought in 43 new institutional limited partner investors, in- the private equity practice by 350 percent to more than 250 convergence of capital and innovation, and this convergence cluding 11 that are based outside the U.S., with representation lawyers and the technology companies practice by 257 per- requires legal advisors who are equally fluent in both worlds. from Australia, Japan, Peru, Norway and Israel. Monroe has cent to more than 200 lawyers. This is a Goodwin hallmark.” also increased its workforce, growing the number of employees 20 percent over the last five years, including a 23 percent boost in 2018, bringing the total to just over 100 employees. Focused on the middle Completed deals market With more than 25 years of While Goodwin has received attention for Represented Kensho Technologies Inc., ▶▶ advising on larger deals, such as Qualtrics experience, CEO Ted Koenig which Goodwin represented Kensho Technol- International Inc.’s $8 billion sale to SAP SE ogies Inc., a developer of artificial intelligence is highly regarded. (NYSE: SAP) and Centerview Partners’ $11.9 bil- founded out of MIT and Harvard University in lion acquisition of Kite Pharma, the core of the 2013, in its sale to S&P Global (NYSE: SPGI) for firm’s M&A practice remains focused on the middle an aggregate purchase price of $550 million Served independent sponsors market. Goodwin improved its overall U.S. deal count from 266 deals valued at $59.5 billion in 2017 to 290 Reflecting the rise of investors who work on deals one by one, Advised Primus Capital in its sale of Hyper- ▶▶ deals valued at $143.3 billion in 2018. Globally, the firm instead of through a private equity fund, Monroe launched a wallet, a Primus portfolio company that helps increased from 320 deals valued at $64.1 billion in 2017 to new Independent Sponsor vertical. This vertical was estab- individuals and small firms receive payments 337 deals valued at $154.5 billion in 2018. lished to support the growing number of fundless sponsors for goods and services that they sell on online seeking a total financing solution that includes both debt marketplaces, to PayPal for $400 million in and equity. The Independent Sponsor vertical closed three cash Experience counts transactions with $122 million funded in 2018. Founded in 1912, Goodwin today boasts more than 100 cor- Advised WisdomTree Investments Inc. in ▶▶ porate M&A attorneys and professional staff with experience its acquisition of ETF Securities’ European Solidified thought leadership role in structuring complex mergers and acquisitions, divestitures, exchange-traded commodity, currency and joint ventures, spinoffs and tender offers. The firm represents With more than 25 years of experience, CEO Ted Koenig is a short-and-leveraged business, for cash and clients on both buy and sell side in a wide range of transac- highly regarded thought leader in middle-market lending. In stock valuing the target at $523 million tions, working with private equity investors and large public 2018, the firm launched the inaugural Chicago Middle Market companies acquiring private businesses. Business Conference, featuring panelists from the city’s top private equity firms, investment banks, and law firms. More than 600 professionals attended.Labo.

TheMiddleMarket.com April 2019 Mergers & Acquisitions 25

025_MAJ0419 25 3/11/2019 11:15:29 AM What makes a winner? Leadership, performance, growth, and innovation are key factors

Mergers & Acquisitions’ M&A Mid-Market Awards honor lead- Deal of the Year recognizes a transformative transaction that ing dealmakers and deals that set the standard for transac- made a significant impact on the buyer’s strategy and/or tions in the middle market. To determine the winners, we an industry. The award goes to the buyer. Corporations and consider a variety of factors, including market leadership, private equity firms are eligible. performance, growth, innovation and thought leadership. We Dealmaker of the Year honors an individual who made a look for companies and individuals who overcame the chal- significant impact on M&A. The award goes to an individual. lenges the year brought, embodied the trends of the period All dealmakers are eligible. and took their businesses to the next level. We value companies that changed the M&A landscape, expanded into new Private Equity Firm of the Year recognizes a PE firm that territories and transformed their businesses. stood out in a competitive landscape. The award goes to the firm, and only PE firms are eligible. Eligibility and nomination process: Investment Bank of the Year honors a firm that outshone the To be eligible for our awards, deals must: be valued at or competition. The award goes to the firm, and only full-service below roughly $1 billion and have been completed (not just investment banks are eligible. announced) by Dec. 31 of the award year. Nominations are encouraged, although not required. The nomination process Private Equity Seller of the Year recognizes a PE firm that ex- is online, and we accept submissions only through our elec- celled in exits. The award goes to the firm, and only PE firms tronic forms. We announce the opening of the nomination are eligible. process on our website and through our daily e-newsletters Strategic Buyer of the Year honors a corporation that wielded in late December or early January. The deadline for nomina- M&A to transform or significantly expand its business and/or tions is typically in late January or early February. There is an industry. The award goes to the company, and only corpo- no fee, and there is no limit on the number of nominations rations are eligible. submitted by a firm or individual. Law Firm of the Year recognizes a firm that excelled. The Awards: award goes to the firm, and only law firms are eligible.

We bestow M&A Mid-Market Awards in the following eight Lender of the Year honors a lender that ran ahead of the categories: pack. The award goes to the lender, and only lenders are eligible.

Five years of winners The M&A Mid-Market Awards honor the leading deals and dealmakers

Deal Dealmaker Private Equity Private Equity Strategic Buyer Investment Bank Lender Law Firm of the Year of the Year Firm of the Year Seller of the Year of the Year of the Year of the Year of the Year

Fortive Hollie Haynes, 2018 Luminate Capital TA Associates The Riverside Co. Nike Harris Williams Monroe Capital Goodwin (Gordian) Partners

Stryker Randy Jacops, LLR Huron Campbell William Twin 2017 (Novadaq) Idera Partners Capital Soup Blair Brook McGuireWoods

Resmed Greg Sandfort, Francisco Harris 2016 (Brightree) Tractor Supply Partners The Halifax Group Dover Williams Golub Kirkland & Ellis

Amazon David Brackett, Newell 2015 (Elemental John Martin, Audax The Riverside Co. KeyBanc NewStar Milbank Technologies) Anatares Rubbermaid

Thoma Bravo Gretchen Perkins, 2014 Huron Capital HGGC The Riverside Co. PPG Industries Piper Jaffray GE Capital Jones Day (TravelClick) Partners

26 Mergers & Acquisitions April 2019

026_MAJ0419 26 3/11/2019 11:15:29 AM Mergers & Acquisitions on Facebook for the latest news and trends in the middle-market industry.

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028_MAJ0419 28 3/7/2019 1:11:04 PM Professional Shareholder Representation - A Must for Sellers

SPONSORED BY PRESENTED BY &

001_MAJ0419029_MAJ0419_001 1 29 3/11/20193/11/19 1:49:41 1:34 PM The founders of SRS Acquiom launched the they should be structuring deals given company because they saw a growing today’s market conditions. There are a lot need for sellers to have professionalized of different ways deals are getting done shareholder representation after today. the closing of an acquisition. Their observation has proven to be correct. M&A: What role can a professional Since the company’s beginning in 2007, shareholder representative play in a it has represented more than 215,000 transaction process? shareholders, handled more than $130 billion in M&A payments and completed Letang: Our role as a professional more than 2,300 transactions valued shareholder representative is to protect at over $1/3 trillion. The company the interests of the seller shareholders currently offers a full portfolio of M&A after the closing of the acquisition. For closing and post-closing solutions one thing, we protect the shareholders’ including shareholder representation, rights to any funds placed into escrow. payments, escrows, and representations “Today we are If the buyers have any claims against and warranties insurance. Mergers & seeing deal the escrow funds, we make sure they Acquisitions was able to sit down with are addressed. If there is any additional Chris Letang, a managing director on parties relying money that should be coming to the the company’s professional shareholder on their counsel shareholders based on an earnout, such representation team, to discuss why as the achievement of post-closing professional shareholder representation for outside the revenue targets, we are on top of it. has become more popular and accepted box guidance When it comes time to distribute escrow in today’s M&A environment. Letang and more than in or earnout proceeds, we play a role in his team manage post-closing claims figuring out how the funds are allocated against escrow funds, earnouts and previous years.” and in the logistics for distribution, purchase price adjustments. Prior to which can be very complex depending joining SRS Acquiom, Letang practiced Chris Letang on waterfalls, number of shareholders corporate law for Cooley LLP and Managing Director, involved, and other factors. For obvious Cravath, Swaine, & Moore LLP. Below is Professional Services reasons, significant issues can arise if you an excerpt from our conversation. accidentally pay the wrong the people— and it can happen. We also make sure the shareholders M&A: How would you characterize the M&A are kept informed as to what to expect and what is environment today? happening post-closing.

Letang: The M&A market is quite strong. Valuations are M&A: Why is having shareholder representation high, deal terms are more favorable to the sellers and important now? there are many competitive bid situations. Letang: If you go back about 15 years, before M&A: What role do lawyers typically play in a SRS Acquiom was founded the concept of the transaction process? shareholder representative wasn’t there. There was no professionalization of the role. Usually a board member Letang: Historically, the role of the lawyer is to draft the got stuck doing it for the group. That was not ideal deal documents, negotiate deal terms and make sure because they could be doing better things and moving their clients are protected from a legal standpoint. on to their next deal. We have a staff of people focused on post-closing issues. It’s their sole focus to make However, today we are seeing deal parties relying on sure shareholders are protected and everything that is their counsel for outside the box guidance more than in supposed to happen after the closing does happen. previous years. They are using their lawyers help on how

002_MAJ0419030_MAJ0419_001 2 30 3/11/20193/11/19 1:49:41 1:34 PM M&A: Shareholder representatives work “Sellers need to M&A: How else can a shareholder for the sellers. Do they matter at all to representative help? buyers? be looking at the track records of Letang: Everyone assumes the deal is Letang: The party that is hiring the going to close and there won’t be issues. shareholder representative is the sell-side, potential And the fact of the matter is most but the buying company definitely has shareholder deals wind up with claims against the an interest in who the shareholder rep is. representatives escrow, purchase price/working capital Buyers want to work with someone who adjustments, or other material issues. We is professional and will ensure the process and the outcomes have people who focus on the accounting is as efficient as possible. Ten years ago of the issues they aspects of the working capital adjustment. there may have been some skepticism Getting that right requires a high level of from the buy-side, but through the years handle on behalf expertise. We also frequently see claims buyers have found it easier to work with a of the sellers.” from third parties pop up. For example, professional who has experience and can a deal closes and a third party says the map the process efficiently. Chris Letang seller violated their intellectual property Managing Director, rights. These types of claims can be quite M&A: What should shareholders Professional Services costly. There are frequently tax issues and be looking for in a shareholder audit issues across various states. It’s hard representative? to say what issues may arise, but the takeaway is that a lot of things can happen that are outside of the sellers’ Letang: If you are on the sell side, you want people who control. You want to be buttoned up and protected, and to have experience and know what they are doing in every have an advocate on your side who has experience with situation. The sellers want to have someone who can all the vagaries of post-closing issues. protect their interests and actively manage the process on their behalf without having to worry. Difficult matters M&A: How do sellers choose the right shareholder do arise. A shareholder representative should be able to representative? handle all the issues with skill and professionalism. Letang: There are different factors that come into M&A: Are there some deals where hiring a professional play, but when sellers are choosing a shareholder shareholder rep doesn’t make sense? representative they want to feel comfortable that their choice can handle it all. There is a good chance that a Letang: In some very small deals we can sometimes deal will have legal, accounting, tax, and other issues see the cost-benefit analysis not making sense to hire a come up. The representative should have experience professional representative. However above that threshold dealing with all of these things. we believe the sellers really should consider hiring a professional to be the shareholder representative no Sellers need to be looking at the track records of matter how tempting it is when a board member or the potential shareholder representatives and the outcomes CEO volunteers to do the job. What the volunteer may of the issues they handle on behalf of the sellers. not understand is the amount of time that it takes to do the job well and the personal liability risk they take on. We have been a shareholder representative for more than For instance, if a post-closing dispute with the buyer ends 10 years at this point. We have reduced claims made up in litigation, the designated shareholder representative against our clients’ escrow funds by $1.6 billion in more will likely be a named party to the lawsuit. That can have than 1,500 deals. We have a talented and experienced all kinds of unpleasant ramifications. In addition to the team on staff dedicated to work on claims, earnouts, and time and hassle, an individual shareholder representative’s proceeds distribution. We also have the benefit of offering personal peace of mind can be at risk as well. payments and escrow services at SRS Acquiom. We have seen it all, and we work together well. We make the process as easy and smooth as possible for our clients.

To Contact SRS Acquiom: 720-895-3976 | srsacquiom.com A3

003_MAJ0419031_MAJ0419_001 3 31 3/11/20193/11/19 1:49:41 1:34 PM Guest Article Guest article

the essence; therefore, it is critical to know the how the PE partner works. What is the firm’s typical due diligence process and timeframe? How soon after the all the audits, legal due diligence, financial due diligence and quality of earnings reports will funds be available? What is the PE firm’s funding limit? Will additional investors be required to participate? The funding needed for lower-middle-market deals, by the nature of the size of the companies involved, typically falls well within a PE firm’s funding capability. Nevertheless, capital limits are best discussed up front, before approaching the target company with the funding plan.

ADOBE STOCK understandings and clears the way for a rapid and successful How to structure a winning PE- close. 4. Establish who pays for costs if a deal fails to independent sponsor partnership close Let’s face it, dead deals happen. Sellers change their minds... the due diligence process may reveal reasons to walk Sellers need to learn as much as they can during due diligence on how PE firms and away... a reasonable valuation cannot be agreed upon… independent sponsors will work together, including funding a deal. deals fail to close for any number of reasons. But who is go- By Derek McDowell ing to absorb the due diligence costs incurred in investigating and evaluating the target acquisition? Financial audits, market analyses, inventory valuations, Independent sponsors and private equity firms can make 1. Line up prospective funding partners early operations audits, legal fees for background checks and for a formidable acquisition team. This is especially true The sooner an independent sponsor can identify a partner drawing up contracts, all of these steps require time, resourc- in the lower-middle market where independent sponsors’ and enter into an agreement with a private equity fund, the es and money. It is imperative that the Independent Sponsor strengths lie, and opportunities abound for smart deal mak- sooner the sponsor can begin closing the deal. Ideally, the and prospective PE funding partner agree up front on who ers. As a fund-less deal negotiator, the independent sponsor relationship is forged before the first outreach to the acquisi- will pay the cost of a dead deal. Be prepared for the PE firm must rely on others for the capital to close deals. Having a tion target company. Having the dedicated capital resources to insist on a higher ownership stake or other financial incen- working relationship with a PE firm provides the independent of a PE partner can be convincing proof that the target tive to take on the risk of funding due diligence on deals that sponsor with an ally and leverage while negotiating the best company is dealing with the right buyer, one with the means may not close. deal possible. Arriving at this deal-closing partnership, how- to fund a deal and bring certainty to closing. ever, requires its own negotiation and deal-making. 5. Negotiate participation fees, The following are some points PE firms and independent 2. Set realistic expectations equity and management roles/fees up front sponsors must consider when agreeing to collaborate on an The due diligence process aside, how quickly can a PE There are two deals in play when the independent spon- acquisition: partner provide the funds to conclude the acquisition? Once a business owner has made the decision to sell, time is of Derek McDowell is a managing partner for private equity firm Boyne Capital Partners.

32 Mergers & Acquisitions April 2019 TheMiddleMarket.com

032_MAJ0419 32 3/11/2019 11:15:33 AM Guest Article Guest article

3. Exclusivity works two ways Just as the independent sponsor seeks an exclusive deal to acquire the target company, the PE firm will insist that they and the independent sponsor partner have an exclusive agreement to avoid a bidding war with other entrants, and that the PE firm has exclusive funding rights to the deal. The independent sponsor may submit a time limit on funding PARTNERS BOYNE CAPITAL exclusivity for the PE firm to avoid taking the acquisition off sor brings in a private equity partner to an acquisition. The the funding market for an unreasonable amount of time. deal to purchase outright or acquire an ownership stake in Addressing exclusivity requirements up front avoids any mis- the target company, and the deal between the PE firm and understandings and clears the way for a rapid and successful the independent sponsor that spells out responsibilities and close. rewards for both parties. Independent Sponsors will want to How to structure a winning PE- establish up front what their commission or fees will be to 4. Establish who pays for costs if a deal fails to handle the deal, how much of an equity stake they will earn independent sponsor partnership close (or be willing to take in exchange for their deal fee), and what Let’s face it, dead deals happen. Sellers change their their continuing role will be in the acquired company (will minds... the due diligence process may reveal reasons to walk they be active senior managers, board members or advi- Sellers need to learn as much as they can during due diligence on how PE firms and away... a reasonable valuation cannot be agreed upon… sors?). No one wants to jeopardize a promising deal over independent sponsors will work together, including funding a deal. deals fail to close for any number of reasons. But who is go- failure to define each party’s role, responsibilities, ownership ing to absorb the due diligence costs incurred in investigating stake and remuneration upon close. and evaluating the target acquisition? Financial audits, market analyses, inventory valuations, The heart of the deal 1. Line up prospective funding partners early operations audits, legal fees for background checks and An M&A funding partnership, in which the independent The sooner an independent sponsor can identify a partner drawing up contracts, all of these steps require time, resourc- sponsor sources and negotiates the deal to acquire a target and enter into an agreement with a private equity fund, the es and money. It is imperative that the Independent Sponsor company and a private equity firm funds the acquisition, sooner the sponsor can begin closing the deal. Ideally, the and prospective PE funding partner agree up front on who can be a win for all sides. A collaboration that works for all relationship is forged before the first outreach to the acquisi- will pay the cost of a dead deal. Be prepared for the PE firm requires effort by the Independent Sponsor and the prospec- tion target company. Having the dedicated capital resources to insist on a higher ownership stake or other financial incen- tive PE funding partner to agree on such things as funding of a PE partner can be convincing proof that the target tive to take on the risk of funding due diligence on deals that caps, exclusive participation for the PE firm, participation company is dealing with the right buyer, one with the means may not close. fees, ownership stakes, ongoing management roles and to fund a deal and bring certainty to closing. services, and more. Once the framework is in place, they’re 5. Negotiate participation fees, ready to pursue acquisitions as a uniquely qualified team 2. Set realistic expectations equity and management roles/fees up front with industry knowledge, operational experience and the The due diligence process aside, how quickly can a PE There are two deals in play when the independent spon- capital resources to make deals happen. M&A partner provide the funds to conclude the acquisition? Once a business owner has made the decision to sell, time is of Derek McDowell is a managing partner for private equity firm Boyne Capital Partners.

TheMiddleMarket.com April 2019 Mergers & Acquisitions 33

033_MAJ0419 33 3/11/2019 11:15:35 AM Top investment banks of 2018 KPMG, Houlihan Lokey, Goldman Sachs, William Blair and Lincoln International led the pack in deal volume.

Demitri Diakantonis and Mary Kathleen Flynn ADOBE STOCK

34 Mergers & Acquisitions April 2019 TheMiddleMarket.com

034_MAJ0419 34 3/11/2019 11:15:05 AM Top investment banks of 2018 KPMG, Houlihan Lokey, Goldman Sachs, William Blair and Lincoln International led the pack in deal volume.

Demitri Diakantonis and Mary Kathleen Flynn ADOBE STOCK

TheMiddleMarket.com April 2019 Mergers & Acquisitions 35

035_MAJ0419 35 3/11/2019 11:15:07 AM Feature

KPMG, Houlihan Lokey, Goldman Sachs, William Blair and about 550 M&A transactions representing more than $190 bil- sory and asset management firm. Lazard’s roots date back to Lincoln International rank as the top five most active M&A lion in value (as of December 31, 2018). 1848 when the company began as a dry goods business. On investment banks in 2018, based on the volume of completed the M&A side, New York-based Lazard focuses on the business deals, according to PitchBook. Here are Mergers & Acquisi- 5. Lincoln International (80) services; consumer; financial services; healthcare; industrials tions’ profiles of the 28 firms that led the league tables in a Lincoln International is a middle-market investment bank and technology, media and telecom sectors. robust year for dealmaking. that provides M&A, growth equity, debt advisory, restructuring, joint ventures and valuation services. The firm was founded in 10. Morgan Stanley (58) 1. KPMG (115 completed deals) 1996, and has more than 500 employees across 20 offices in Morgan Stanley (NYSE: MS) is a financial services firm that KPMG is an advisory firm that offers tax, audit and advisory 15 countries. Among the sectors that Lincoln focuses on are: provides investment banking, wealth management, sales services. The firm was formed in 1987 through the merger of business services; consumer; energy; healthcare; industrials and trading, and research services. The New York-based firm Peat Marwick International and Klynveld Main Goerdeler. and technology, media and telecom. Lincoln, headquartered also owns a middle-market private equity firm called Morgan KPMG, whose U.S. headquarters are in New York, has more than in Chicago, advised on over 200 deals globally in 2018. Almost Stanley Capital Partners. The latter invests in businesses that 200,000 employees in 154 countries. Among the industries that half of the firm’s transactions are cross-border. are valued up to $500 million. Morgan Stanley investment KPMG focuses on are: financial services, oil and gas, real estate management had about $471 billion in assets as of Sept. 30, and construction, power and utilities, and metals and mining. In 6. Robert W. Baird (70) 2018. Earlier in 2019, Morgan Stanley announced plans to buy 2018, KPMG bought cybersecurity firm Cyberinc. Baird is an employee-owned investment bank, private eq- Solium Capital Inc., a provider of software-as-a-service for uity firm, and wealth management firm. The Milwaukee-based equity administration, financial reporting and compliance. 2. Houlihan Lokey (95) firm was founded in 1919, and has about 3,500 employees. As Houlihan Lokey Inc. (NYSE: HLI) is an investment bank that of Sept. 30, 2018, Baird had about $217 billion in assets. Baird’s 11. Evercore (55) offers M&A, capital markets, financial restructuring, valuation PE arm, Baird Capital, invests in businesses that have up to Evercore Inc. (NYSE: EVR) offers capital markets advisory, and strategic consulting services. In 2018, Los Angeles-based $150 million in revenue across the healthcare, industrials and research, sales and trading, along with wealth management Houlihan Lokey acquired BearTooth Advisors, a firm that technology sectors. Baird Capital has invested in more than services. The New York-based firm was founded in 1995 by provides strategic advisory and placement agency services to 300 companies since it was founded in 1989. former Lehman Brothers and Blackstone Group (NYSE: BX) alternative investment managers. In that same year, the firm executive Roger Altman. Evercore has about 1,700 employees formed HL Finance LLC to arrange senior secured leveraged 7. Raymond James Financial (67) in 10 countries, and has advised on more than $2 trillion worth loans for financial sponsor-backed, privately held, and public Raymond James Financial Inc. (NYSE: RJF) is a financial of deals since its inception. In middle market M&A, Evercore corporate entities. Investment firm HPS Investment Partners is services firm that provides investment bank and wealth man- recently advised Six Senses Hotels Resorts Spas on its $300 HL Finance’s initial strategic investor and will provide under- agement services. The firm, based in St. Petersburg, Florida, million sale to InterContinental Hotels Group, and AppRiver on writing commitments of up to $1 billion. was founded in 1962 by Bob James, and went public 1983. its $275 million sale to Zix Corp. (Nasdaq: ZIXI). Raymond James focuses on the consumer and retail, finan- 3. Goldman Sachs (88) cial services, healthcare and industrial sectors, among others. 12. Credit Suisse (52) Goldman Sachs Group (NYSE: GS) is an investment and Earlier in 2019, Raymond James reached a deal to acquire Credit Suisse provides investment banking and wealth investment management firm that offers a range of services Silver Lane Advisors, an investment bank that focuses on the management services. The Zurich-based firm, founded in 1856, including: M&A and investment banking, consumer bank- financial services sector. has 46,840 employees and operations in about 50 coun- ing, asset management, private wealth management, direct tries. The firm’s investment banking division concentrates on private investing, and middle-market financing and investing. 8. Harris Williams (65) the energy; financial services; healthcare; real estate; retail; Goldman Sachs, through its special situations group, lends Harris Williams is a middle-market investment bank that and technology, media and telecom sectors. Credit Suisse is and invests up to $150 million directly to mid-sized companies. focuses on sell-side of transactions. The Richmond, Virginia- advising Merck (NYSE: MRK) on its $300 million acquisition for The special situations group provides lending, mezzanine and based firm concentrates on the aerospace and defense, immunotherapy research company Immune Design (Nasdaq: growth capital to mid-market businesses in the U.S. and in consumer, healthcare, industrials, and transportation and IMDZ). Earlier in 2019, Credit Suisse’s venture capital arm, Europe. The New York-based firm was founded in 1869. logistics sectors, among others. Harris Williams, founded in Credit Suisse Entrepreneur Capital Ltd., announced plans to 1991, completed 87 transactions in 2018, the most in firm history invest in robotics startup Perspective Robotics. 4. William Blair (87) and up more than 22 percent from just two years before. The William Blair is global boutique with expertise in investment firm’s 2018 aggregate sell-side transaction value of more than 13. Piper Jaffray (49) banking, investment management, and private wealth man- $31 billion topped the prior year by more than 28 percent and Piper Jaffray Cos. (NYSE: PJC) is a middle-market invest- agement. The employee-owned firm was founded in 1935 by exceeded 2016’s total aggregate transaction value by more ment bank based in Minneapolis. The firm concentrates on a William McCormick Blair, and has 1,500 employees worldwide. than 50 percent. number of sectors including: business services, consumer and William Blair’s investment banking group offers comprehen- retail, financial services, healthcare and industrials. In addition sive buy-side and sell-side services for publicly traded and 9. Lazard (60) to M&A, Piper Jaffray also provides merchant asset manage- privately held companies. Since 2014, the firm has completed Lazard Ltd. (NYSE: LAZ) is a middle-market financial advi- ment, equity sales and trading, equity research and merchant

36 Mergers & Acquisitions April 2019 TheMiddleMarket.com

036_MAJ0419 36 3/11/2019 11:15:08 AM about 550 M&A transactions representing more than $190 bil- sory and asset management firm. Lazard’s roots date back to banking services. Piper Jaffray was founded in 1895, and has lion in value (as of December 31, 2018). 1848 when the company began as a dry goods business. On 1,300 employees across 58 offices. Earlier in 2019, Piper Jaffray the M&A side, New York-based Lazard focuses on the business announced plans to buy Weeden & Co., a provider of trading 5. Lincoln International (80) services; consumer; financial services; healthcare; industrials technology services, for up to about $74 million. Lincoln International is a middle-market investment bank and technology, media and telecom sectors. that provides M&A, growth equity, debt advisory, restructuring, 14. GCA Advisors (46) joint ventures and valuation services. The firm was founded in 10. Morgan Stanley (58) GCA is an investment bank that provides M&A, capital mar- 1996, and has more than 500 employees across 20 offices in Morgan Stanley (NYSE: MS) is a financial services firm that kets and private funds advisory services to growth companies. 15 countries. Among the sectors that Lincoln focuses on are: provides investment banking, wealth management, sales The New York-based firm closed 145 transactions in 2018, con- business services; consumer; energy; healthcare; industrials and trading, and research services. The New York-based firm centrating on the consumer and retail, digital media, financial and technology, media and telecom. Lincoln, headquartered also owns a middle-market private equity firm called Morgan technology, healthcare, industrials and technology sectors. in Chicago, advised on over 200 deals globally in 2018. Almost Stanley Capital Partners. The latter invests in businesses that GCA has more than 400 employees in 20 offices across the half of the firm’s transactions are cross-border. are valued up to $500 million. Morgan Stanley investment U.S., Asia and Europe. GCA recently advised learning platform management had about $471 billion in assets as of Sept. 30, company Studydrive on its acquisition by StepStone. 6. Robert W. Baird (70) 2018. Earlier in 2019, Morgan Stanley announced plans to buy Baird is an employee-owned investment bank, private eq- Solium Capital Inc., a provider of software-as-a-service for 15. Moelis 42) uity firm, and wealth management firm. The Milwaukee-based equity administration, financial reporting and compliance. Moelis & Co. (NYSE: MC) is an investment bank that pro- firm was founded in 1919, and has about 3,500 employees. As vides M&A, recapitalization, restructuring and capital markets of Sept. 30, 2018, Baird had about $217 billion in assets. Baird’s 11. Evercore (55) advisory services. The firm has 19 offices across North and PE arm, Baird Capital, invests in businesses that have up to Evercore Inc. (NYSE: EVR) offers capital markets advisory, South America, Europe, Asia, Australia and the Middle East. $150 million in revenue across the healthcare, industrials and research, sales and trading, along with wealth management Moelis was founded in 2007 by Ken Moelis, and has advised technology sectors. Baird Capital has invested in more than services. The New York-based firm was founded in 1995 by on more than $2.3 trillion worth of deals since its inception. 300 companies since it was founded in 1989. former Lehman Brothers and Blackstone Group (NYSE: BX) In mid-market M&A, Moelis is advising Nexeo Solutions on its executive Roger Altman. Evercore has about 1,700 employees $640 million sale of its plastics distribution business to One 7. Raymond James Financial (67) in 10 countries, and has advised on more than $2 trillion worth Rock Capital Partners. Raymond James Financial Inc. (NYSE: RJF) is a financial of deals since its inception. In middle market M&A, Evercore services firm that provides investment bank and wealth man- recently advised Six Senses Hotels Resorts Spas on its $300 16. Bank of America (41) agement services. The firm, based in St. Petersburg, Florida, million sale to InterContinental Hotels Group, and AppRiver on Bank of America (NYSE: BAC) is a financial services firm was founded in 1962 by Bob James, and went public 1983. its $275 million sale to Zix Corp. (Nasdaq: ZIXI). that serves both commercial and consumer clients with bank- Raymond James focuses on the consumer and retail, finan- ing, investing, asset management and other financial and cial services, healthcare and industrial sectors, among others. 12. Credit Suisse (52) risk management products to small and mid-sized businesses Earlier in 2019, Raymond James reached a deal to acquire Credit Suisse provides investment banking and wealth and large corporations. Bank of America also offers M&A Silver Lane Advisors, an investment bank that focuses on the management services. The Zurich-based firm, founded in 1856, and investment banking services, along with equity research. financial services sector. has 46,840 employees and operations in about 50 coun- Charlotte, North Carolina-based Bank of America is advising tries. The firm’s investment banking division concentrates on Apax and AssuredPartners on the sale of the majority stake in 8. Harris Williams (65) the energy; financial services; healthcare; real estate; retail; AssuredPartners to GTCR. Harris Williams is a middle-market investment bank that and technology, media and telecom sectors. Credit Suisse is focuses on sell-side of transactions. The Richmond, Virginia- advising Merck (NYSE: MRK) on its $300 million acquisition for 16. J.P. Morgan (41) based firm concentrates on the aerospace and defense, immunotherapy research company Immune Design (Nasdaq: J.P. Morgan (NYSE: JPM) is a financial advisory firm that consumer, healthcare, industrials, and transportation and IMDZ). Earlier in 2019, Credit Suisse’s venture capital arm, offers a number of services including: investment banking and logistics sectors, among others. Harris Williams, founded in Credit Suisse Entrepreneur Capital Ltd., announced plans to M&A, asset management, equity research and trading, and 1991, completed 87 transactions in 2018, the most in firm history invest in robotics startup Perspective Robotics. commercial and private banking. J.P. Morgan, led by CEO and up more than 22 percent from just two years before. The Jamie Dimon, acquired Bear Stearns during the 2008 financial firm’s 2018 aggregate sell-side transaction value of more than 13. Piper Jaffray (49) crisis. In mid-market deals, New York-based J.P. Morgan is $31 billion topped the prior year by more than 28 percent and Piper Jaffray Cos. (NYSE: PJC) is a middle-market invest- advising Attunity on its $560 million sale to Qlik. exceeded 2016’s total aggregate transaction value by more ment bank based in Minneapolis. The firm concentrates on a than 50 percent. number of sectors including: business services, consumer and 18. Jefferies Group (33) retail, financial services, healthcare and industrials. In addition Jefferies is a diversified financial services company that 9. Lazard (60) to M&A, Piper Jaffray also provides merchant asset manage- is involved in investment banking and capital markets, asset Lazard Ltd. (NYSE: LAZ) is a middle-market financial advi- ment, equity sales and trading, equity research and merchant management and direct investing. On the M&A side, Jef-

TheMiddleMarket.com April 2019 Mergers & Acquisitions 37

037_MAJ0419 37 3/11/2019 11:15:09 AM Feature

feries completed more than 530 transactions valued over 2017, which is number 21 on this list with 28 deals. $435 billion since 2016. Jefferies is advising Compass Group Diversified Holdings (NYSE: CODI) and Manitoba Harvest on 24. Capstone Headwaters (21) the sale of the latter to Tilray Inc. (Nasdaq: TLRY). Earlier in Capstone Headwaters is a middle-market investment 2019, New York-based Jefferies proposed to buy the near 30 bank that offers M&A, corporate restructuring, debt advisory percent stake it does not already own in real estate developer and private equity coverage, and has an industry research HomeFed Corp. team. Capstone, which is located in Boston and Denver, acquired Morgan Stanley’s (NYSE: MS) middle market business 18. Livingstone (33) in 2010 and Headwaters MB in 2017. Earlier in 2019, Capstone Livingstone Partners is a middle-market M&A and debt ad- advised Andrie LLC on its acquisition by Auxo Investment visory firm that has offices in Chicago, Los Angeles and across Partners. Europe. The firm, founded in 2007, completed about $11 billion worth of deals between 2016 and 2018. In 2018, Livingstone 25. Benchmark International (19) advised behavior analysis provider Total Spectrum on its sale Benchmark International is a middle-market investment to LLR Partners-backed Learn Behavioral. bank that advises companies that are valued up to $500 million. The Tampa, Florida-based firm, founded in 2012, 20. RBC Capital Markets (32) provides M&A, growth and exit planning services. Bench- RBC is an investment bank and a diversified provider of mark concentrates on the manufacturing, services and retail financial services. The Toronto-based firm, founded in 1864, sectors, among others, with deals that are valued at around offers M&A, lending and fixed income services. Between Nov. 1, $100 million. Earlier in 2019, Benchmark advised government 2017 and Oct. 31, 2018, RBC advised on 149 M&A transactions services company Amtis Inc. on its acquisition by Blackfish worth $186 billion, according to Dealogic. RBC is part of Royal Federal LLC. Bank of Canada. 25. Dinan (19) 21. KeyBanc (28) Dinan & Co. is a middle-market investment bank that KeyBanc Capital Markets, a subsidiary of Cleveland-based provides M&A, valuation and fairness opinions, and merchant KeyCorp. (NYSE: KEY), is a middle-market investment bank. banking advisory services. The firm advises private equity In addition to M&A, KeyBanc offers divestitures, tender offers, firms and Fortune 1000 companies. Since it was founded in joint ventures, strategic alliances, takeover defense, recapital- 1988, Phoenix-based Dinan, which has around 80 profession- izations and restructuring services. In 2018, KeyBanc complet- als, has closed over 600 transactions representing more than ed 94 M&A transactions representing $17 billion in deal value. $50 billion in deal value, with an average deal size of $65 In 2017, KeyBanc acquired Cain Brothers, which is number 23 million. on this list with 22 deals. 25. Macquarie Group (19) 22. Stifel (27) Macquarie Group is a financial services firm that offers Stifel Financial Corp. (NYSE: SF) is a diversified wealth man- M&A advisory, capital raising, project finance, private capital agement and investment banking company that was founded markets and investment services. The Sydney-based firm also in 1890. The firm has closed 1,683 transactions valued at $392 offers asset financing in the aerospace, energy, healthcare, billion since 2000. St. Louis-based Stifel owns Eaton Partners, industrials, manufacturing, rail and mining and technology Keefe, Bruyette & Woods and Miller Buckfire. Earlier in 2019, sectors, along with corporate financing. In 2018, Macquarie Stifel advised NRI on its sale to Wind Point Partners. sold Advantage Funding Management, a provider of commercial vehicle and transportation financing services, to 23. Cain Brothers (22) Sterling Bancorp. (NYSE: STL). Cain Brothers & Co. announced 40 M&A transactions in 2018 with a total transaction value of $9 billion. The firm 25. Petsky Prunier (19) focuses on healthcare services, life sciences and medical Petsky Prunier is a middle-market investment bank that technology. In addition to M&A advisory, Cain offers financing offers M&A, capital markets and private placement services. services to corporate and not-for-profit healthcare organiza- New York-based Petsky Prunier founded in 1999, advised on tions, including bond underwriting and leveraged lending. New more than 30 deals in 2018. Earlier in 2019, Petsky Prunier York-based Cain was acquired by KeyBanc Capital Markets in was acquired by Canaccord Genuity Group Inc. M&A

38 Mergers & Acquisitions April 2019

038_MAJ0419 38 3/11/2019 11:15:09 AM People Moves

New hires and promotions

By Demitri Diakantonis

Scott Adamson was hired by Alston & Linklaters, and represents funds, lend- Thompson Hine, Gennuso focuses on Bird as a partner. Previously with Vedder ers, borrowers and sponsors in finance private equity and M&A. Price, Adamson concentrates on M&A in transactions. the construction, healthcare, manufac- Myrto Gouti has been named counsel turing and technology sectors. Mattias de Beau has joined Adams at Ropes & Gray. She focuses on private Street Partners as a partner, where he equity and M&A. David Berk was hired by Gryphon is responsible for investment opportu- Investors-backed Milani Cosmetics as nities, conducting due diligence, and Angad Hira has been promoted from chief financial officer. He previously held managing private equity fund manager vice president to CFO at VMG Partners, positions at L’Oreal USA. relationships throughout Europe. He was where he is responsible for all of the PE previously with StepStone Group. firm’s financial operations. Hira joined Mark Blaufuss was hired by VMG in 2010. the Carlyle Group (Nasdaq: Stacey Dion was CG) as an operating executive promoted from Amit Jain has joined TA Associates as in the firm’s industrials and managing director a vice president, where he is focusing transportation group. Blaufuss to global head of on investments in the technology sec- is the former CFO of Met- government affairs tor. Jain was most recently with Marlin aldyne Performance Group at the Carlyle Group Equity Partners, and was previously with (NYSE: MPG). (Nasdaq: CG). She TA from 2013 to 2016. is leading Carlyle’s Neil Caddy was hired by Fried, global government Christopher Kandel has joined Morri- Frank, Harris, Shriver & Jacob- Angad Hira relations and public son & Foerster as a finance partner. He son LLP as a partner. He was policy functions, focuses on senior, second lien and mez- most recently with Milbank collaborating with zanine financings, high yield securities, Tweed Hadley & McCloy LLP, Carlyle senior ex- structured loans, capital markets and and focuses on finance and ecutives and invest- restructurings. He was most recently financial restructuring. ment professionals with Latham & Watkins. to shape Carlyle’s Kevin Campbell was promot- global legislative Matthew Kirst was hired by Neptune ed from president of global and regulatory Financial Inc., a technology-enabled consulting to CEO at Bridge activities. lower middle-market commercial lender, Growth Partners-backed data as a senior managing director. Kirst Stacey Dion analytics company BackOf- Andy Fincher has previously held roles at Heller Financial, fice Associates. Campbell been named CEO GE Capital and CapitalSource. joined BackOffice in 2018, and he was at family office HBM Holdings. Fincher previously the chief operating officer of was most recently the CEO of Dover Fritz Lark was hired by Mayer Brown as Oscar Insurance Corp. Engineered Systems, a division of Dover a partner. Most recently with Brace- Corp. (NYSE: DOV). well, Lark concentrates on M&A in the Kathryn Cecil was hired by Fried, Frank, energy and utilities, insurance, financial Harris, Shriver & Jacobson LLP as a Peter Gennuso was hired by Drinker services, manufacturing, chemicals and partner. She was most recently with Biddle as a partner. Previously with technology sectors.

TheMiddleMarket.com April 2019 Mergers & Acquisitions 39

039_MAJ0419 39 3/11/2019 11:14:38 AM People Moves

Jamie Lerner, the CEO and president of Rob Ruegger has joined food and Zack Stiefler was hired by Corridor Quantum Corp., has been named chair beverage and consumer-focused Capital as a principal, where he is of the board of directors of Astia, an an- private equity firm Kainos Capital as a focusing on evaluation, due diligence, gel investor network that backs women- managing director. Ruegger was most and execution of new investments. He led companies. Lerner has served on the recently the chief operating officer of was previously with Lindsay Goldberg. board since 2011. Gehl Foods. Igor Taber was hired by automated ma- John Martin has been named managing Chris Rutherford was hired by Macqua- chine learning company DataRobot as partner at Baker Botts. He is currently rie Capital as a manag- senior vice president of the partner-in-charge at the firm’s Palo ing director. Rutherford corporate development, Alto, California, office, and concentrates was previously with where he is overseeing on M&A. UBS, and focuses on the the company’s M&A oil and gas sector. strategy. Taber was most Colin McClary was hired by Morri- recently with venture sAnderson as a partner. He was previ- Erik Schneider has been capital group Intel ously with Bank of America and Z Z named partner at Nixon Capital. Capital Partners, and focuses on bank- Peabody. He concen- ing, restructuring and private equity. trates on debt-related Eric Tanck has been Wade Miquelon transactions. named partner at Nixon Wade Miquelon was promoted from Peabody. He concen- CFO to CEO at Leonard Green & Margaret Seurynck has trates on M&A in the Partners-backed Joann Stores, a fabric joined McGuireWoods food and beverage, and craft retailer. as a senior counsel. Pre- healthcare and high-tech viously with Jones Day, manufacturing sectors. Eamon Nolan has joined Vinson & Elkins Seurynck represents as a partner. He was previously with lenders and borrowers Bryan Taylor has joined Linklaters, and focuses on leveraged in transactions such as Advent International to buyouts and acquisition financing. secured and unsecured lead the firm’s technol- loans, asset-based Margaret Seurynck ogy investment team. Rob Novak was hired by consulting firm loans and cash flow loans. Taylor was previously the MorrisAnderson as a partner. He was co-head of TPG Capital’s technology previously with Alvarez & Marsal and John Sinders has joined Founders’ Advi- group. focuses on restructuring. sors as a managing director, where he is leading the firm’s new Houston office. Marissa Wiley has been named partner Sonal Patel has been named partner Sinders previously led or co-led energy at Nixon Peabody. She focuses on M&A at Ropes & Gray. She concentrates on transactions at Jefferies, RBC and in the healthcare sector. private equity and M&A. Howard Weil. John Wright has joined Ballard Spahr Matthew Roberts has joined M&A advi- Michael Sirkin has joined Jamieson as a senior counsel, where he focuses sory firm Copper Run as vice President, Corporate Finance as chairman and on M&A. He most recently served as leading northeast Ohio operations. He managing director, where he is focusing general counsel at aerospace and was previously with MelCap Partners. on M&A. Sirkin was most recently with defense supplier Triumph Group Inc. Proskauer Rose. (NYSE: TGI). Ivana Rouse has joined Latham & Watkins as a partner, where she is advising private Steve Snyder has been named CEO at Sam Wright was hired by Duff & Phelps funds on investment, fundraising, and op- Mason Wells-backed Whitehall Special- as a managing director, where he is erational matters. She was most recently ties, a cheese and dairy products com- conducting buyside and sellside due with Akin Gump Strauss Hauer & Feld LLP. pany. Snyder served on the company’s diligence. He was previously with CBIZ board for the last four years. Inc. (NYSE: CBZ). M&A

40 Mergers & Acquisitions April 2019

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