AeroVironment acquires BlueHalo in $4.1bn deal

BY Fraser Tennant

In a deal that creates a diversified global leader in all-domain defence technologies, drone manufacturer AeroVironment (AV) is to acquire space and defence engineering company BlueHalo in an all-stock transaction valued at approximately $4.1bn. 

Under the terms of the definitive agreement, AV will issue approximately 18.5 million shares of AV common stock to BlueHalo. AV’s shareholders will own approximately 60.5 percent of the combined company following the close of the transaction, with BlueHalo’s equity holders owning approximately 39.5 percent, subject to closing adjustments.

The combined company will bring together complementary capabilities to offer a comprehensive portfolio of high-growth franchises, powered by cutting-edge technology and focused on addressing the most important priorities and needs of the US and its allies around the globe.

It is expected that the companies’ shared culture of agile innovation and mission expertise will enable the combined entity to develop and deliver next-generation technologies that will have significant military value and redefine the next era of US defence technology.

“For over 50 years, AV has pioneered innovative solutions on the battlefield, and today we are poised to usher in the next era of defence technology through our combination with BlueHalo,” said Wahid Nawabi, chairman, president and chief executive of AV. “BlueHalo not only brings key franchises and complementary capabilities, but also a wealth of technologies, diverse customers and exceptional talent to AV.

“Together, we will drive agile innovation and deliver comprehensive, next-generation solutions designed to redefine the future of defence,” he continued. “We are thrilled to welcome the talented BlueHalo team as we unite our strengths, expand our global impact and accelerate growth and value creation for AV shareholders.”

Following completion of the transaction, Mr Nawabi will be chairman, president and chief executive of the combined company. Jonathan Moneymaker, chief executive of BlueHalo, will serve as a strategic adviser to Mr Nawabi and the combined company’s management team.

“BlueHalo was founded to address the most pressing challenges confronting the defence and national security community, from unconventional threats to near-peer adversaries,” said Mr Moneymaker. “We have pioneered solutions for drone warfare, distributed autonomy, and the need for more robust and assured access to space in an increasingly contested, crowded and competitive domain.”

The transaction, which has been unanimously approved by both companies’ board of directors, is expected to close in the first half of 2025, subject to regulatory and AV shareholder approvals, as well as other customary closing conditions.

Mr Moneymaker concluded: “Together, we remain committed to protecting those who defend us while driving the next generation of transformational advancements in defence technology.”

News: Drone maker AeroVironment seeks lift from $4.1 bln deal for BlueHalo

CareMax files for Chapter 11 bankruptcy and agrees asset sales

BY Richard Summerfield

CareMax Inc, which runs a system of medical centres catered toward elderly patients, has filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the Northern District of Texas.

Miami-based CareMax filed Chapter 11 on Sunday, listing assets of between $100m and $500m, and liabilities between $500m and $1bn. CareMax sought court protection after cost cuts and attempts to refinance its debt.

As per the filing, CareMax has filed customary motions with the court, seeking authorisation to maintain business-as-usual operations, including by continuing operations to ensure patients at its clinics continue to receive high quality, value-based healthcare, paying associated wages, including for its doctors and nurses, without interruption and paying the existing pre-petition claims of certain vendors that are critical to the health and safety of CareMax’s patients and critical to the operation of the company’s medical centres.

The company has also announced it has entered into an agreement to sell its management services organisation. According to a statement announcing the deal, CareMax has entered into an agreement with an affiliate of Revere Medical which will see the company acquire the Medicare Shared Savings Program portion of the CareMax’s management services organisation that supports care provided to approximately 80,000 Medicare beneficiaries. The sale of the business is anticipated to be consummated simultaneously with the consummation of CareMax’s prearranged Chapter 11 plan.

CareMax also announced that it has reached an agreement in principle on a ‘stalking horse’ agreement with a third-party buyer for its operating clinic business. The closing of this sale is also anticipated to be consummated simultaneously with the consummation of CareMax’s bankruptcy plan. CareMax intends to disclose the proposed terms of the stalking horse agreement and the potential purchaser when and if an agreement is finalised.

“After a careful review of the Company’s strategic alternatives, we have determined that the transactions announced today are our best opportunity to protect the long-term value of the CareMax assets and ensure our patients, providers, and health plans can continue to rely on the comprehensive, coordinated care we provide,” said Carlos de Solo, chief executive of CareMax. “We are deeply appreciative of the outstanding team members across CareMax, whose hard work and commitment to our partners is resolute.”

CareMax’s Chapter 11 filing is the latest in a series of Chapter 11 filings by other healthcare groups this year, including Massachusetts-based Steward Health Care. Steward filed for bankruptcy in May, seeking to sell its 31 hospitals and address $9bn of debt.

News: Medical services provider CareMax files for Chapter 11 restructuring

Coterra Energy announces $3.5bn asset acquisitions

BY Richard Summerfield

Coterra Energy has announced it is to acquire certain assets in the Permian Basin worth $3.95bn from privately held Avant Natural Resources and Franklin Mountain Energy.

The deals will see Coterra acquire approximately 49,000 net highly contiguous acres in Lea County, New Mexico, creating a new 83,000-net-acre focus area. The cash portion of the deals is expected to be funded through a combination of cash on hand and borrowings. The company will issue approximately 40.9 million shares of Coterra common stock to certain sellers, valued at approximately $1bn.

The transactions are each subject to satisfaction of customary terms and conditions and expected to close during the first quarter of 2025 with an effective date of 1 October 2024. Neither deal is conditioned on the closing of the other transaction.

“We are thrilled to announce the pending acquisition of two high-quality Permian Basin asset packages,” said Tom Jorden, chairman, chief executive and president of Coterra. “These highly accretive acquisitions create an expanded core area in New Mexico that plays to Coterra’s organizational strengths. In addition to adding significant oil volumes in 2025, the acquired assets provide inventory upside to established and emerging oil-weighted formations.

“We have been drilling horizontal wells in Lea County, New Mexico since 2010 and are extremely excited with the recent results and future opportunity across the area. The newly scaled platform provides a long runway for capital efficient development and substantial free cash flow generation. Importantly, we are maintaining an industry-leading balance sheet,” he added.

The assets to be acquired include 400-550 net Permian locations, which will increase Coterra's New Mexico net locations by around 75 percent and Permian net locations by around 25 percent. Coterra said the acquisitions will create an additional oil-weighted focus area in New Mexico, with acreage adjacent to its existing footprint. The company estimates the acquired assets will add oil production of 40,000-50,000 barrels per day (bbl/day) and total production of 60,000-70,000 barrels of oil equivalent per day (boe/day) in 2025, with capital expenditures of $400m-$500m.

For 2025, Coterra has forecast pro forma oil production of 150,000-170,000 bbl/day, up 49 percent compared to the estimated 2024 midpoint of oil guidance, and total production of 720,000-760,000 boe/day, up 11 percent compared to the estimated 2024 midpoint of total production guidance of 55-60 percent oil. The company also forecast $2.1bn-$2.4bn of total capital spending in 2025, around 75 percent weighted to the Permian Basin.

News: Coterra Energy to shell out $3.95 bln to boost Permian Basin presence

Cencora acquires RCA in $4.6bn transaction

BY Fraser Tennant

In a deal that expands its speciality services, drug distributor Cencora is to acquire Retina Consultants of America (RCA) from private equity firm Webster Equity Partners for $4.6bn.

The acquisition of RCA – a management services organisation (MSO) that operates a network of retina specialists – will add to Cencora’s specialty capabilities and expand its business, broadening physician and manufacturer relationships as well as Cencora’s value proposition to all its stakeholders.

Cencora plans to fund the transaction through a combination of existing cash on hand and new debt financing. RCA’s affiliated practices, physicians and management will retain a minority interest in RCA, with Cencora holding approximately 85 percent ownership in RCA upon closing.

“The acquisition of RCA will allow Cencora to broaden our relationships with community providers in a high growth segment and build on our leadership in specialty,” said Bob Mauch, president and chief executive of Cencora. “With a compelling value proposition for physicians, an impressive leadership team and strong clinical research capabilities, RCA is well-positioned at the forefront of retinal care.

The leading MSO in the retina space and a trusted healthcare provider, RCA’s nearly 300 retina specialists across 23 states provide high-quality care to patients with physicians conducting over 2 million visits annually.

Cencora expects to use its suite of manufacturer services to enhance RCA’s research programme and outcomes, maintaining its position as a partner of choice to pharmaceutical innovators in the retina space.

“We are pleased to enter our next phase of growth with the support of a leading global pharmaceutical solutions organisation,” said Robby Grabow, chief executive of RCA. “With additional resources to support the continued execution of our growth strategy, we will be better positioned to continue expanding our physician network and enhancing the quality of care we provide.”

The transaction is subject to the satisfaction of customary closing conditions, including receipt of required regulatory approvals.

Mr Mauch concluded: “The addition of RCA will allow us to expand our MSO solutions and drive differentiated value across the healthcare system for manufacturers, providers and patients.”

News: Cencora bolsters specialty business with $4.6 bln deal for Retina Consultants of America

Stonepeak takes ATSG private in $3.1bn deal

BY Fraser Tennant

In a deal that takes the aviation holding company private, Air Transport Services Group (ATSG) is to be acquired by US investment firm Stonepeak in an all-cash transaction valued at approximately $3.1bn.

Under the terms of the definitive agreement, which has been unanimously approved by ATSG’s board of directors, holders of ATSG’s common shares will receive $22.50 per share in cash.  

The agreement includes a go-shop period whereby ATSG may solicit proposals from third parties for a period of 35 days continuing through 8 December 2024, and in certain cases for a period of 50 days continuing through 23 December 2024.

The transaction has fully committed equity financing from funds affiliated with Stonepeak and fully committed debt financing. The transaction is not subject to a financing condition. Upon completion, ATSG’s shares will no longer trade on NASDAQ, and ATSG will become a private company.

“This transaction reflects the tremendous value of our fleet of in-demand midsize freighter and passenger aircraft, and the strength of our talented teams across ATSG’s businesses,” said Mike Berger, chief executive of ATSG. “With Stonepeak’s investment and extensive expertise in transportation and logistics and asset leasing, ATSG will be well positioned to further expand its global presence in the air cargo leasing market and enhance its service offerings to customers.”

A premier provider of aircraft leasing and cargo and passenger air transportation solutions for both domestic and international air carriers, as well as companies seeking outsourced airlift services, ATSG is the global leader in freighter aircraft leasing with a fleet that includes Boeing 767, Airbus A321 and Airbus A330 converted freighters.

“ATSG plays a fundamental role in enabling the growth of e-commerce globally in a world that continues to shift away from brick-and-mortar shopping,” said James Wyper, senior managing director and head of transportation & logistics at Stonepeak. “ATSG’s deep relationships with some of the world’s largest e-commerce companies and integrators gives us confidence in the company’s trajectory as a sector leader.”

The transaction is expected to close in the first half of 2025, subject to customary closing conditions, including approval of ATSG’s shareholders and receipt of regulatory approvals.

Mr Berger concluded: “We would like to thank our employees for helping us achieve this significant milestone and for their continued dedication as we prepare to enter this new chapter as a private company.”

News: Stonepeak nears $3.1 billion deal for aircraft lessor ATSG