Temasek acquires Element in $7bn deal

BY Fraser Tennant

In one of its largest-ever deals, Singapore state-backed investor Temasek has agreed to buy the global leader in testing, inspection and certification (TIC) services Element Materials Technology Group from private equity firm Bridgepoint for an estimated $7bn. 

Element generates annual revenues of around $1bn and has grown at over 20 percent a year over the last 10 years. Temasek has been a minority shareholder in Element since 2019.

Tracing its origins back 190 years, London-based Element now operates a global network of more than 200 laboratories across 30 countries, servicing thousands of customers in life sciences, connected technologies, aerospace, transportation, energy transition, built environment and beyond.

Moreover, the company works with customers across a wide spectrum – from testing the next generation of aircraft and autonomous vehicles, to vaccine component testing in its US pharmaceutical laboratories, and from the certification of smartphones and wearable technologies, to providing cellular carrier approvals and testing connected robots.

“Element has a highly talented management team and exceptional people across our offices and laboratories around the world,” said Allan Leighton, non-executive chair of Element. “This transaction is a testament to their skills and commitment and creates the launchpad for the next exciting horizon of growth for the company.”

Operating in technically demanding and highly regulated sectors, Element is well-positioned to further accelerate its growth as it builds stronger positions in end-markets, such as life sciences and connected technologies.

“We are pleased to continue our relationship with Element as it works with its customers and explores greater opportunities to be part of their decarbonisation and sustainability journeys,” said Uwe Krueger, head of the portfolio management group at Temasek. “As a leading TIC business, Element is at the forefront of enabling innovative solutions across various industries.”

The transaction is subject to customary regulatory approvals.

“The acquisition of Element by Temasek is a landmark transaction in the TIC sector, and a critical step in the development of the Group,” concluded Jo Wetz, chief executive of Element. “We are delighted to expand our relationship with Temasek – their intimate understanding of the Group and their track record of enabling businesses with sustainability at their core will help to accelerate the growth of our business in the years ahead.”

News: Temasek buys Bridgepoint's Element Materials in $7 bln deal

Microsoft’s $68.7bn Activision Blizzard acquisition

BY Richard Summerfield

Microsoft Corp has announced a $68.7bn all-cash deal to acquire Activision Blizzard in the biggest gaming industry deal in history. The deal will see Microsoft become the world’s third-biggest gaming company by revenue behind China’s Tencent and Japan’s Sony.

The deal, which is also set to become the largest all-cash acquisition on record and Microsoft’s biggest ever deal, will see the company pay $95 per share – a 45 percent premium to Activision’s closing price last Friday.

Under the terms of the deal, Bobby Kotick will continue to serve as chief executive of Activision Blizzard, and he and his team will maintain their focus on driving efforts to further strengthen the company’s culture and accelerate business growth. Once the deal closes, the Activision Blizzard business will report to Phil Spencer, chief executive of Microsoft Gaming.

“Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of metaverse platforms,” said Satya Nadella, chairman and chief executive of Microsoft. “We’re investing deeply in world-class content, community and the cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive and accessible to all.”

“Players everywhere love Activision Blizzard games, and we believe the creative teams have their best work in front of them,” said Mr Spencer. “Together we will build a future where people can play the games they want, virtually anywhere they want.”

“For more than 30 years our incredibly talented teams have created some of the most successful games,” said Mr Kotick. “The combination of Activision Blizzard’s world-class talent and extraordinary franchises with Microsoft’s technology, distribution, access to talent, ambitious vision and shared commitment to gaming and inclusion will help ensure our continued success in an increasingly competitive industry.”

The transaction is subject to customary closing conditions, regulatory review and Activision Blizzard’s shareholder approval. The deal is expected to close in fiscal year 2023 and will be accretive to non-GAAP earnings per share upon close. The transaction has been approved by the boards of directors of both Microsoft and Activision Blizzard.

Throughout the COVID-19 pandemic, gaming has enjoyed a dealmaking boom. Last week, Take Two Interactive acquired Zynga in a $12.7bn deal, creating a global console and mobile gaming giant.

News: Microsoft to gobble up Activision in $69 billion metaverse bet

Aptiv acquires Wind River in $4.3bn transaction

BY Fraser Tennant

In a $4.3bn transaction which accelerates the journey toward a software-defined automotive industry, global technology company Aptiv PLC is to acquire intelligent edge software solutions provider Wind River, which is backed by private equity firm TPG Capital.

The deal is to be financed through a combination of cash and debt, and will allow Aptiv to expand into multiple high-value industries with Wind River’s world-class team and leading intelligent systems software platform.

Moreover, the combination will enable multiple end-use innovations and applications, particularly as computing and processing continue to move closer to the edge and connected devices, including vehicles, and expand in complexity and capabilities.

“The automotive industry is undergoing its largest transformation in over a century, as connected, software-defined vehicles increasingly become critical elements of the broader intelligent ecosystem,” said Kevin Clark, president and chief executive officer of Aptiv. “Fully capitalising on this opportunity requires comprehensive solutions that enable software to be developed faster, deployed seamlessly and optimised throughout the vehicle lifecycle.”

Developing safer, greener and more connected solutions that enable a more sustainable future of mobility, Aptiv has more than 180,000 employees strategically located to serve customers globally – solving the automotive industry’s toughest challenges with scalable, intelligent platforms that accelerate the transition to software-defined, electric vehicles.

“Wind River has established itself as a worldwide leader in intelligent edge software that delivers the highest levels of security, safety, reliability and performance,” said Kevin Dallas, president and chief executive of Wind River. “Combining Wind River’s industry-leading software, customer base and talent with Aptiv’s complementary technologies, global resources and scale will realise our vision of a new machine economy.”

A global leader in delivering software for mission-critical intelligent systems, Wind River software is used on over 2 billion edge devices across more than 1700 customers globally. The company generated approximately $400m in revenues in 2021.

The acquisition is expected to close mid-year 2022 and is subject to customary conditions, including receipt of applicable regulatory approvals.

“Together we will accelerate the digital transformation of our customers across industries through best-in-class intelligent systems software,” concluded Mr Dallas. “We look forward to working with the Aptiv team to reach even greater heights and provide further growth opportunities for our customers and partners.”

News: Aptiv to bulk up software offerings with $4.3 bln Wind River deal

Stryker Corp agrees $2.97bn Vocera deal

BY Richard Summerfield

Medical device manufacturer Stryker Corp has agreed to acquire Vocera Communications in a deal worth $2.97bn. The deal is expected to close in the first quarter of this year and is estimated to have a neutral impact on net earnings per diluted share in 2022, Stryker said in a statement.

Under the terms of the deal, Stryker will pay $79.25 per share for the company, for a total equity value of approximately $2.97bn and a total enterprise value of approximately $3.09bn including convertible notes. The boards of both Stryker and Vocera have unanimously approved the acquisition.

Vocera specialises in communication and workflow platforms, as well as software for healthcare providers such as hospitals, allowing for internal and patient-to-doctor communications to improve patient data sharing. The company also makes smart wearable devices for healthcare professionals as well as smartphone applications.

“This acquisition underscores our commitment and focus on our customer,” said Kevin Lobo, chair and chief executive of Stryker. “Vocera will help Stryker significantly accelerate our digital aspirations to improve the lives of caregivers and patients.”

“Today’s milestone represents an exciting opportunity for Vocera given the clear alignment of mission, goals and culture between our two organizations and our ability to drive even greater economic and clinical value for our customers,” said Brent Lang, chairman and chief executive of Vocera.

Stryker officials are said to have been attracted to Vocera’s “highly complementary and innovative portfolio” of tools to help connect caregivers and “disparate data-generating medical devices”, with an eye toward boosting patient safety and outcomes and improving provider workflows.

Specifically, Vocera’s software and hardware for remote communication complements Stryker’s Advanced Digital Healthcare tools, the company said, and will improve its efforts to help its customers reduce and prevent adverse events across the care continuum.

The deal is the latest in a number of significant multibillion health IT acquisitions. Other deals announced so far this year include Castlight Health’s merger with Vera Whole Health and Aetion’s acquisition of Replica Analytics.

News: Medical device maker Stryker to buy Vocera Communications for $2.97 bln

CBRE to acquire logistics assets for $4.9bn

BY Richard Summerfield

CBRE Investment Management, a unit of CBRE Investment, has agreed to acquire several logistics assets from Hillwood Investment Properties in a deal valued at $4.9bn.

The deal includes 33 assets in the US and 24 across Germany, Poland and the UK and will close in stages throughout 2022 and possibly into 2023. The transaction will add 28.4 million square feet to CBRE’s logistics property portfolio, the company said in a statement.

“This milestone transaction reflects our ability to leverage the strong financial capacity of our parent company to secure compelling opportunities that help to drive strategic real assets solutions for our clients,” said Chuck Leitner, chief executive of CBRE Investment Management. “Backed by a $35 billion AUM global logistics platform and a skilled team with deep domain expertise, we are positioned to be one of the world’s leading investors and operators of logistics assets.”

Approximately two-thirds of the portfolio being acquired is already built and leased. The rest is either in search of tenants or still being developed. The portfolio was appealing to CBRE because it was located in markets with large labour forces, has advanced transportation systems and is close to a large number of consumers.

Hillwood has divested a number of facilities in recent years, capitalising on the increased demand for warehouse space. In late 2020, the company sold a portfolio of 23 facilities to Stockbridge Capital Group and the National Pension Service of Korea. The transaction was valued at $2bn, the largest of its kind since the beginning of the COVID-19 pandemic at the time.

Industrial real estate made history in the third quarter of 2021 as e-commerce and other tenants grappled for limited US warehouse space. According to Transwestern, the segment logged 159 million square feet of net absorption — the amount of space newly occupied minus the amount vacated. It was the highest quarterly total since 2008. There is currently 637 million square feet of industrial warehouses under construction across the US, almost double the volume of five years ago.

CBRE Investment has more than $133bn in assets, including $35bn in industrial property across the world. CBRE has more than 100,000 employees serving clients in more than 100 countries. The company formed a global sector-specific team in June 2021 to enhance and better align its global logistics expertise.

News: CBRE unit to buy warehouses in U.S., Europe in $4.9 bln deal