Sembcorp agrees $6.29bn Keppel Corp deal

BY Richard Summerfield

Singaporean offshore engineering group Sembcorp Marine has agreed to a $6.29bn merger with Keppel Corp’s offshore and marine unit. 

Under the terms of the deal, Temasek, Sembcorp’s majority shareholder, will become the largest shareholder in the merged company, with a 33.5 percent stake. As part of the merger, Keppel and its shareholders will own 56 percent of the newly combined company, with Sembmarine’s shareholders owning the rest.

According to a joint statement announcing the deal, the combined entity’s market value was S$8.7bn on a proforma basis, but that this could change based on the entity’s share price when it lists.

The combined company will be wholly owned by a new holding entity, which will be listed on the Singapore stock exchange, the two companies said in the joint statement. A shareholder meeting is expected to be held in the fourth quarter to seek approval for the transaction, which is subject to various regulatory sign offs.

“The signing of a win-win agreement on the Proposed Combination of Keppel O&M and Sembcorp Marine marks a strategic milestone for the offshore & marine sector,” said Loh Chin Hua, chief executive of Keppel and chairman of Keppel O&M. “It brings together two leading O&M companies in Singapore to create a stronger player that can realise synergies and compete more effectively amidst the energy transition. Together with the resolution of Keppel O&M’s legacy rigs, this is a major step forward in Keppel’s Vision 2030 journey, as we simplify our business and sharpen our focus on providing solutions for sustainable urbanisation.”

“The Proposed Combination marks a major milestone in Sembcorp Marine’s strategic business transformation journey since 2015 to stay resilient amid dramatic changes in our industry,” said Tan Sri Mohd Hassan Marican, chairman of Sembcorp Marine. “Sembcorp Marine and Keppel O&M are Singapore’s homegrown marine icons. I am confident the Combined Entity, with its larger operational scale, broader geographical footprint and enhanced capabilities, will create a leading Singapore player to capitalise on the opportunities in the offshore and marine, as well as the renewable and clean energy sectors.”

“We are pleased that Keppel and Sembcorp Marine have come to an agreement on the terms of a combination that we think will be transformational for the companies,” said Nagi Hamiyeh, head of the portfolio development group at Temasek. “We believe the combined business will have the expertise and capacity to accelerate the pivot towards growing opportunities in the renewable and clean energy sectors, and pursue meaningful projects around the world that address the increasing need for greener and cleaner energy solutions. In doing so, it will be able to deliver long-term value creation for shareholders and other stakeholders. We look forward to the support of the shareholders of Keppel and Sembcorp Marine to make this possible.”     

News: Temasek-backed oil rig builders agree $6.3 bln merger amid sector downturn

Elon Musk acquires Twitter in $44bn transaction

BY Fraser Tennant

In a deal that shifts control of the social media platform to the world's richest man, Twitter, Inc. has been acquired by entrepreneur, investor, media proprietor and business magnate Elon Musk for $44bn.

Under the terms of the definitive agreement, Twitter stockholders will receive $54.20 in cash for each share of Twitter common stock that they own upon closing of the proposed transaction. Upon completion of the transaction, Twitter will become a privately held company.

Mr Musk has secured $25.5bn of fully committed debt and margin loan financing and is providing an approximately $21bn equity commitment. There are no financing conditions to the closing of the transaction.

The world's richest person according to Forbes magazine, Mr Musk has an estimated net worth of $273.6bn, mostly due to his shareholding in electric vehicle maker Tesla and his aerospace firm SpaceX.

"Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated," said Mr Musk. "I also want to make Twitter better than ever by enhancing the product with new features, making the algorithms open source to increase trust, defeating the spam bots, and authenticating all humans.”

The transaction, which has been unanimously approved by the Twitter board of directors, is expected to close in 2022, subject to the approval of Twitter stockholders, the receipt of applicable regulatory approvals and the satisfaction of other customary closing conditions.

"The Twitter board conducted a thoughtful and comprehensive process to assess Elon's proposal with a deliberate focus on value, certainty, and financing,” said Bret Taylor, independent board chair at Twitter. “The proposed transaction will deliver a substantial cash premium, and we believe it is the best path forward for Twitter's stockholders."

Mr Musk concluded: “Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it."

News: Musk gets Twitter for $44 billion, to cheers and fears of 'free speech' plan

Fight for Twitter intensifies amid ‘poison pill’ tactics

BY Richard Summerfield

The fight for control of social media giant Twitter has intensified in recent days as the company responds to the $43.3bn takeover offer from entrepreneur Elon Musk.

In early April, Mr Musk, the chairman of Tesla, announced that he had become Twitter’s largest stakeholder after quietly acquiring a 9.2 percent stake in the company in recent months. He was then offered a seat on the board, a move that was abruptly reversed after Mr Musk declined. He then made the offer to acquire the company outright.

Mr Musk informed Twitter last week that his $54.20-per-share all-cash bid for the company was his “best and final offer”, and that he would reconsider his position as a Twitter shareholder if it was rejected. He has claimed his offer would help “unlock” the company’s “extraordinary potential”. He also noted that he had made the offer because he believes it is important to have an “inclusive arena for free speech.” Furthermore, he said that if Twitter’s board of directors chose to reject the offer, it would be “utterly indefensible not to put this offer to a shareholder vote”.

In response to the offer, Twitter’s board unanimously approved a plan that would allow existing shareholders to buy stocks at a substantial discount in order to dilute the holdings of new investors. The ‘poison pill’ tactic is the clearest evidence so far that Twitter intends to fight the takeover. It would go into effect if a shareholder were to acquire more than 15 percent of the company in a deal not approved by the board and expires 14 April 2023. Every other shareholder aside from Mr Musk would be allowed to purchase new shares at half the market price, which stood at $45.08 at the end of trading on Thursday last week.

“The Rights Plan does not prevent the Board from engaging with parties or accepting an acquisition proposal if the Board believes that it is in the best interests of Twitter and its shareholders,” Twitter said in a statement.

In addition to Mr Musk’s takeover offer, Thoma Bravo, a technology-focused private equity firm that had more than $103bn in assets under management as of the end of December, is also believed to be exploring the possibility of putting together a bid for the company.                

Asset manager Vanguard Group said in a filing submitted recently to the Securities and Exchange Commission (SEC) that, as of 8 April, its funds now own a 10.3 percent stake in Twitter, making it the company’s largest shareholder.

Mr Musk is facing legal action over his Twitter share purchases, with one investor launching a potential class action lawsuit against him for failing to disclose his buy-up of shares before the required deadline to do so. Mr Musk is also facing several investigations by the SEC for his investment activities, including insider trading allegations related to his own tweets.

News: Twitter adopts 'poison pill' as challenger to Musk emerges

KKR agrees Barracuda deal

BY Richard Summerfield

KKR & Co has agreed to acquire cyber security firm Barracuda Networks from its private equity owner Thoma Bravo. While no financial terms were disclosed, the transaction is believed to be worth around $4bn, including debt.

The deal, which is expected to close by the end of the year, subject to customary conditions, is the latest in the increasingly active cyber security space. Dealmaking in the market has intensified over the last two years as remote working became the norm following the outbreak of the coronavirus (COVID-19) pandemic. Russia’s invasion of Ukraine has also caused companies to redouble their efforts on the cyber security front amid a rise in cyber attacks.

Founded in 2003, Barracuda is a developer of cyber security solutions, including email protection, app and cloud defences, data management and network security. The company caters to approximately 200,000 customers worldwide across a variety of industries, including education, government, financial services, health care, retail, consumer goods and manufacturing. Barracuda tends to focus on small to medium-sized businesses.

Thoma Bravo acquired Barracuda in 2017 for $1.6bn. Since that time, the company has enjoyed growth of over $500m in revenue.

“We believe that with the support of KKR, we will continue to invest in growth and foster a culture that gives our team the resources and inspiration to continue to create and deliver the next generation of leading cybersecurity solutions for our customers and partners,” said Hatem Naguib, chief executive of Barracuda. “We are very appreciative of Thoma Bravo’s support and very excited to be working with KKR on this next phase of Barracuda’s journey.”

“We continue to see cybersecurity as a highly attractive sector and are excited to back a clear leader in the space,” said John Park, head of Americas technology private equity at KKR. “Given its proven track record of growth and innovation, we believe that Barracuda has the right team and model to capture business in this growing market.”

“Barracuda has built an impressive portfolio of solutions that are helping SMEs around the world protect their data and address critical security challenges,” said Bradley Brown, managing director at KKR. ”We see a tremendous opportunity for long-term growth as these businesses continue to invest more in cybersecurity and we look forward to helping Barracuda scale and deliver next generation products that meet this growing need.”

The investment in Barracuda builds upon KKR’s experience investing in the cyber security sector globally, with investments including Ping, Cylance, DarkTrace, ForgeRock, NetSPI and Optiv, among others.

News: KKR to buy cybersecurity firm Barracuda from Thoma Bravo in deal worth about $4 bln

Goldman Sachs acquires NN Investment Partners in €1.7bn deal

BY Fraser Tennant

In a €1.7bn transaction that “advances it commitment to sustainability”, US multinational investment bank and financial services company Goldman Sachs has acquired Dutch-based asset manager NN Investment Partners.

Upon completion, NN Investment Partners will be integrated into Goldman Sachs Asset Management, with the company’s more than 900 employees joining the Goldman Sachs family and the Netherlands becoming an important location in Goldman Sachs’ European business.

Moreover, the acquisition brings Goldman Sachs’ assets under supervision to approximately $2.8 trillion and affirms its position as a top five active asset manager globally, with leading franchises in fixed income, liquidity, equities, alternatives and insurance asset management.

Headquartered in The Hague, NN Partners manages approximately $340bn in assets for institutions and individual investors worldwide, with offices in 15 countries across Europe, North America, Latin America, Asia and the Middle East.

Highly complementary to Goldman Sachs Asset Management’s existing European footprint, NN Investment Partners adds new capabilities and accelerating growth in products such as European equity and investment grade credit, sustainable and impact equity, and green bonds.

In addition, the firm has been successful in incorporating environmental, social and governance (ESG) factors across its product range, with ESG criteria integrated into approximately 90 percent of assets under supervision. Goldman Sachs Asset Management intends to leverage this expertise to complement its existing investment processes, helping to deepen ESG integration across its product range and deliver on sustainable investing priorities.

“This acquisition advances our commitment to put sustainability at the heart of our investment platform,” said David Solomon, chairman and chief executive of Goldman Sachs. “It adds scale to our European client franchise and extends our leadership in insurance asset management.”

As part of the transaction, Goldman Sachs Asset Management has entered into a long-term strategic partnership agreement with NN Group, the parent company of NN Investment Partners, to manage an approximately $180bn portfolio of assets, reflecting the strength of the business’ global insurance asset management capabilities and alternatives franchise.

Mr Solomon concluded: “We are excited to welcome the talented team at NN Investment Partners, a centre of excellence in sustainable investing, to Goldman Sachs and together we will focus on delivering long-term value to our clients and shareholders.”

News: Goldman pays 1.7 billion euros for Dutch-based asset manager