AIR Communities goes private in $10bn deal

BY Fraser Tennant

In a move that takes the real estate investment trust private, US alternative investment management company Blackstone is to acquire Apartment Income REIT – known as AIR Communities – in an all-cash transaction valued at approximately $10bn.

Under the terms of the definitive agreement, Blackstone will acquire all outstanding common shares of AIR Communities for $39.12 per share. Subject to and upon completion of the transaction, AIR Communities’ common stock will no longer be listed on the New York Stock Exchange.

The transaction has been unanimously approved by the AIR Communities board of directors.

“The transaction will strengthen the AIR mission to provide homes for others, be a great place to work, act as responsible stewards of AIR communities, and be a trusted partner to AIR investors,” said Terry Considine, president and chief executive of AIR Communities. “The business the AIR team has built will be improved and expanded by collaboration with Blackstone and a shared focus on serving residents and investing wisely.”

AIR Communities’ portfolio consists of 76 high-quality rental housing communities concentrated primarily in coastal markets including Miami, Los Angeles, Boston and Washington DC. Blackstone plans to invest more than $400m to maintain and improve the existing communities in the portfolio and may invest additional capital to fund further growth.

“AIR Communities represents the highest quality, large scale apartment portfolio we have ever acquired, and is located in markets where multifamily fundamentals are strong,” said Nadeem Meghji, global co-head of Blackstone Real Estate. “We are very impressed by the terrific operating team at AIR Communities and look forward to working closely with them, while continuing to deliver a fantastic resident experience.”

A global leader in real estate investing, Blackstone is the largest owner of commercial real estate globally, owning and operating assets across every major geography and sector, including logistics, residential, office, hospitality and retail.

The acquisition is expected to close in the third quarter of 2024, subject to approval by AIR Communities’ stockholders and other customary closing conditions.

Mr Considine concluded: “The AIR team is grateful to Blackstone for the opportunity and for its faith in what can be accomplished working together.”

News: Blackstone to take Apartment Income REIT private in $10bn deal

Johnson & Johnson agrees $13.1bn Shockwave deal

BY Richard Summerfield           

Johnson & Johnson has agreed to acquire Shockwave Medical in a deal valued at $13.1bn including debt.

Under the terms of the deal, Johnson & Johnson will pay $335 per share to acquire the company, a 17 percent premium to the stock’s closing price in late March, when rumours of a potential deal first began to emerge.

The acquisition is expected to close by mid-year 2024, subject to Shockwave’s shareholder approval, as well as the receipt of applicable regulatory approvals and other customary closing conditions.

“With our focus on Innovative Medicine and MedTech, Johnson & Johnson has a long history of tackling cardiovascular disease – the leading cause of death globally,” said Joaquin Duato, chairman and chief executive of Johnson & Johnson. “The acquisition of Shockwave and its leading IVL technology provides a unique opportunity to accelerate our impact in cardiovascular intervention and drive greater value for patients, shareholders and health systems.”

“Shockwave offers a truly differentiated opportunity to further enhance our leadership position in medtech, expand into additional high-growth segments, and ultimately transform the future of cardiovascular treatment,” said Tim Schmid, executive vice president and worldwide chairman of Johnson & Johnson MedTech. “Shockwave’s IVL technology for treating CAD and PAD, and its strong pipeline, are in a class of their own.”

“Shockwave has transformed the treatment of complex calcified arterial disease through the pioneering development of intravascular lithotripsy, and it is our mission to make this remarkable technology available to patients worldwide,” said Doug Godshall, president and chief executive of Shockwave. “As part of a larger, more diverse organization, with broad expertise and a core focus on improving patient outcomes, we are confident we will be able to further solidify IVL as the global standard of care for patients.”

Johnson & Johnson has been placing greater emphasis on its cardiac health business in recent years, spending $16.6bn to acquire heart pump maker Abiomed in 2022 and $400m to buy heart-centric device maker Laminar. In early 2023, the company announced its plans to focus on deals that would add value to its portfolio of cardiovascular products, and that many of its future transactions were likely to be smaller ‘tuck-in’ acquisitions.

In 2023, Shockwave’s revenue grew 49 percent to $730m, according to its most recent quarterly earnings report. The company projects that its revenue in 2024 will rise another 25 percent to between $910m and $930m.

News: J&J boosts heart device business in $13.1 bln Shockwave deal

SLB announces all-stock acquisition of ChampionX

BY Richard Summerfield

SLB has agreed to acquire rival oilfield service provider ChampionX Corporation for $7.8bn in an all-stock deal which will bolster SLB’s technology portfolio.

Under the terms of the agreement, ChampionX shareholders will receive 0.735 shares of SLB common stock in exchange for each ChampionX share held. At the closing of the transaction, ChampionX shareholders will own approximately 9 percent of SLB’s outstanding shares of common stock.

The transaction is subject to ChampionX shareholders’ approval, regulatory approvals and other customary closing conditions. Closing of the transaction is expected to occur before the end of 2024.

“Our customers are seeking to maximize their assets while improving efficiency in the production and reservoir recovery phase of their operations,” said Olivier Le Peuch, chief executive of SLB. “This presents a significant opportunity for service providers who can partner with customers throughout the entire production lifecycle, offering integrated solutions and delivering differentiated value. The combination of ChampionX’s strong production-focused leadership throughout North America and beyond with our own international presence, unmatched technology portfolio, and history of innovation will drive tremendous value for our customers and stakeholders.”

“Today’s announcement marks the start of an exciting next chapter for ChampionX,” said Soma Somasundaram, president and chief executive of ChampionX. “We have been on a journey to build the best production-focused company in our sector, with a goal of unlocking energy through our differentiated products and technology as well as our strong financial engine. Becoming part of SLB will give us a much broader portfolio and the resources and reach to continue to lead the industry in providing energy to the world in an economically and environmentally sustainable way. Our companies share a vision for the future of energy that leverages technology and innovation to solve our customers’ most complex problems and better serve the communities in which we operate.”

According to a statement announcing the deal, SLB expects to realise annual pre-tax synergies of approximately $400m within the first three years post-closing through revenue growth and cost savings.

The company has also announced plans to return $7bn to shareholders over the next two years. SLB will increase its 2024 shareholder returns to a target of $3bn as well as set a target for 2025 shareholder returns of $4bn. Last week, SLB announced it had agreed to combine its carbon capture business with Aker Carbon Capture in a $379.67m deal. SLB will own 80 percent of that combined business.

News: SLB to buy ChampionX for $8 billion in growing deal-making in US energy sector

The Home Depot acquires SRS in $18.25bn deal

BY Fraser Tennant

In what constitutes the US home improvement chain's largest acquisition, The Home Depot is to acquire building materials supplier SRS Distribution (SRS) in a deal valued at approximately $18.25bn.

The transaction brings together the impressive talent, technology and capabilities of SRS with The Home Depot’s trusted name and robust platform of The Home Depot, expanding SRS’ reach into numerous new product categories and customers.

The combined platform will open new opportunities for existing suppliers and partners by providing access to SRS’ expert workforce focused on specialty verticals, as well as The Home Depot’s cross-project expertise, product mix, network and digital assets.

“We are proud to be combining with The Home Depot to continue our growth journey with the additional resources and capabilities they will put behind us,” said Dan Tinker, president and chief executive of SRS. “We set out to find the optimal strategic outcome for the business, and we strongly believe we have achieved just that. With this combination, the future has never been brighter for our supplier partners, our customers and our team.”

Founded in 2008 and headquartered in McKinney, Texas, SRS has grown to become one of the fastest-growing building products distributors in the US. The company operates under a family of distinct local brands encompassing more than 760 locations across 47 states.

Upon the new structure, Mr Tinker and his senior management team will continue to lead SRS operations, reporting to Ted Decker, chair, president and chief executive of The Home Depot.

“SRS’ ability to build leadership positions in each of its trade verticals while generating significant revenue growth is a testament to its strong vision, leadership, culture and execution,” said Mr Decker. “SRS’ branch network, coupled with The Home Depot’s 2000-plus US stores and distribution centres and comprehensive product offering provides the residential and commercial Pro customer with more fulfillment and service options than ever before.”

The transaction is expected to close by the end of 2024 and is subject to regulatory approvals and other customary closing conditions.

Mr Decker concluded: “I look forward to welcoming the SRS team to The Home Depot and in capturing the exciting opportunity ahead.”

News: Home Depot bulks up Pro-business with $18.25 bln deal for building products supplier SRS

Ingersoll Rand acquires ILC Dover in $2.3bn deal

BY Fraser Tennant

As part of a plan to expand its presence in life sciences, global industrial-machinery company Ingersoll Rand is to acquire engineering development and manufacturing firm ILC Dover (ILC) in a transaction valued at $2.3bn.

The acquisition – which sees Ingersoll buy ILC from New York-based investment company New Mountain Capital, four years after it acquired ILC – also includes an earnout based on meeting specific operating efficiency metrics in 2024.

The transaction will see the integration of ILC with the life science-focused brands of Ingersoll Rand, including Air Dimensions, ILS, Thomas, Tricontinent, Welch and Zinsser Analytic.

“Through ILC, we will get access to approximately 1000 customers in the broader life science and healthcare sectors, where we can leverage our demand generation capabilities to drive incremental growth in other product lines like compressors,” said Vicente Reynal, chairman and chief executive of Ingersoll Rand. “Working together, we will continue to drive sustained growth, lead customer value and innovation, and maximise value creation.”

A world-leader in innovative solutions for biopharmaceutical, pharmaceutical and medical device markets, as well as a leading supplier for the space industry, ILC has a 75-year heritage of innovation and commitment to expanding its product portfolio of mission-critical applications. It serves its global customer base across 11 engineering and production facilities located in North America, Europe and Asia.

“I am excited to combine the Ingersoll Rand and ILC Life Science portfolio of products that allow us to serve our customers from the discovery phase in the laboratory to the commercial production of life saving therapies,” said Corey Walker, president and chief executive of ILC. “Our direct channel access coupled with Ingersoll Rand’s proven growth and efficiency tools will allow us to accelerate our ability to serve customers across their workflows.”

The transaction is subject to customary regulatory approvals and is expected to close in the second quarter of 2024.

“This acquisition is the next phase of our long-term vision to expand into higher-growth end markets like life sciences,” concluded Mr Reynal. “I am incredibly excited to partner with the outstanding team at ILC to enhance our presence in key workflows and applications.”

News: Ingersoll Rand to buy ILC Dover for about $2.33 billion in life sciences push