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Sony Music buys UK podcast producer Somethin’ Else

Sony Music is latest after Spotify, Amazon and Apple to try to cash in on boom in audio listening.

Sony Music has acquired the UK’s largest independent podcast producer, Somethin’ Else, which makes David Tennant’s interview series and The Sun King, David Dimbleby’s deep dive into the life of Rupert Murdoch.

Home to artists from Beyoncé and AC/DC to Dolly Parton, Sony is using the acquisition to spearhead the launch of a new global podcast division.

“Our new global podcast division is key to our plans for a fast-paced expansion in the market, diversifying our creative abilities and providing a home for exciting content that will benefit millions of podcast lovers around the world,” said Dennis Kooker, the president of global digital business and US sales at Sony Music Entertainment, the Sony subsidiary that struck the deal.

Companies ranging from Spotify and Amazon to Apple have been snapping up now increasingly scarce prime podcast producers and platforms to cash in on a boom in audio listening and diversify away from a reliance on music streaming.

Read More – www.theguardian.com

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Buyout of AOL, Yahoo signals PE’s biggest bet on digital media

Apollo Global Management has for years wanted to become a major player in the media world. The firm finally got its wish Monday.

After days of speculation, Apollo has agreed to acquire a 90% stake in Verizon’s portfolio of digital news sites, including Yahoo and AOL, from Verizon for about $5 billion.

The deal marks private equity’s biggest bet yet on the embattled digital media industry, which has struggled to compete with Google and Facebook for a share of the digital advertising market. And it puts Apollo, an investor engulfed in controversy for the past year-plus over co-founder Leon Black’s connections to disgraced financier Jeffrey Epstein, in control of a collection of news sites after spending years betting on legacy media.

“It’s a textbook Apollo deal, They’ve been interested in media space for a while, judging by their past bidding activity. Apollo probably likes the space since many other investors are avoiding it.”

Indeed, Apollo’s history with media companies dates back years. But that history hasn’t always been successful.

 

Read More – www.pitchbook.com

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Private equity brushes off past club deal woes with $34B Medline buyout

Private equity’s biggest guns are once again showing they can have record-setting buyout firepower when they work as a team.

After recently backing away from so-called club deals that bring together multiple firms, the industry now has its largest acquisition in years. The Carlyle Group and Hellman & Friedman have joined forces to acquire Medline in a deal reportedly worth around $34 billion, including debt.

The deal comes after US private equity firms amassed approximately $721 billion in dry powder as of June 30, 2020 following years of record fundraising outputs. And it may signal that club deals involving multiple buyout shops have returned after they fell out of favor following a series of high-profile flops.

The Medline deal also marks the largest private equity buyout by value in at least a decade, according to PitchBook data. So far in 2021, private equity firms have struck 13 deals in the US worth $5 billion or more, surpassing last year’s total of 11.

 

Read More – www.pitchbook.com

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UK still top for US-EU inbound M&A activity, says new report

Despite Brexit, the UK is still the top destination for US-EU inbound M&A activity, representing nearly 40 per cent of EU deals since 2009 – and activity could pick up with greater Brexit certainty.

The report, which gathers the collective thoughts of Akin Gump lawyers and senior dealmakers at global companies to see how Brexit, global trade disputes and this year’s US elections are shaping the deal landscape, also finds that even though M&A now involves additional layers of geopolitical and regulatory complexity brought on by global trade tensions and political turbulence, deals are getting done.

with Republicans and Democrats offering starkly divergent platforms on a number of key policy issues, the report says the results of the 2020 US elections are certain to influence M&A activity in 2020 and beyond.

Following a decisive UK election outcome, the report suggests that deal activity could pick up. “There is an M&A backlog, as some deals went on hold before the election,” says Akin Gump corporate partner Gavin Weir. “This bodes well for activity in 2020 as buyers and sellers return to the market.”

Sebastian Rice, partner in charge of Akin Gump’s London office, adds: “There is recognition that the [deal] process is more complex, but if you address issues early, deals will close.”

Looking at deal activity in the United States, Jeff Kochian, co-head of Akin Gump’s corporate practice, says: “The US M&A market has been very strong for the last several years. In spite of global trade and political volatility, the strong US economy and bullish equity markets have been particularly helpful to strategic buyers. Private equity has also been very active, doing more, albeit somewhat smaller deals.”

Read More – https://www.privateequitywire.co.uk

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Musk qualifies for $2.1bn payday after Tesla rally

A prolonged bounce in Tesla’s share price means its chief executive Elon Musk has qualified for a $2.1bn payout, in his second award since May.

The electric carmaker’s six-month average market capitalisation officially surpassed $150bn today, triggering the vesting of the second of 12 tranches of options granted to Musk in 2018.

Musk, who is also majority owner and chief executive of rocket firm Space X, receives no salary.

Tesla is now the world’s most valuable carmaker, almost reaching $300bn this month to be worth more than the market values of Toyota, Ford, General Motors and Fiat Chrysler combined.

It is set to report its quarterly earnings on Wednesday evening, which if profitable, will determine whether Tesla can enter the S&P 500 index on Wall Street.

Analysts’ estimates for Tesla currently range from an adjusted loss as steep as $2.53 a share to a $1.41 per share profit.

However on average, they expect an adjusted 11 cents loss per share and a net loss of $240m, according to Refinitiv data.

Tesla shares have surged more than 275 per cent so far this year, though reporting a loss this evening could send its stock plummeting.

Earlier this month, Tesla surpassed expectations when it announced it had delivered more than 90,000 vehicles in the quarter, defying a wider industry downturn.

But while vehicle deliveries increased 2.5 per cent on a quarterly basis, production dropped nearly 20 per cent. Tesla had previously predicted it would deliver at least 500,000 vehicles by the end of the year.

Its main Fremont carmaking plant was shut for six weeks earlier this year due to lockdown measures during the coronavirus pandemic, putting a dampener on production numbers.

Tesla has said it plans to open a new plant in the south-west of the US as soon as the third quarter, but it has yet to announce a location.

Read More – www.cityam.com

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Hedge fund criticises ‘unjust’ takeover bid for Sirius Minerals

Crispin Odey’shedge fund has attacked Anglo-American’s “unjust” takeover bid for Sirius Minerals, saying the £405m offer does not represent a fair price for shareholders in the troubled fertiliser miner.

Odey Asset Management, which owns 1.3% of Sirius, said it would vote against the mining giant’s 5.5p-a-share bid for the company, which plans to dig the UK’s first deep mine in 40 years under the North York moors.

In an open letter to Anglo’s boss, Mark Cutifani, and Chris Fraser, the chief executive of Sirius, the London-based fund argued that Anglo had stopped short of making a “final” offer so that it could raise its bid to see off any potential counter bid for the company.

Odey said it believed Anglo would be willing to “bid substantially more” for Sirius if a counter bid for the company emerged, which it said proved that the existing offer did not represent a fair price for the company.

 

“It is Odey’s belief that Anglo American’s current offer does not represent fair value for shareholders in Sirius,” said the letter, which was signed by Odey’s fund manager, Henry Steel. The hedge fund said it would vote against any offer that was not final or that was less than 7p a share.

The existing takeover offer would wipe out the investments of thousands of small shareholders, but it still won the support of the Sirius chairman, Russell Scrimshaw. He said last month it was “the only viable proposal” to save the company’s multibillion-pound project to develop the Woodsmith fertiliser mine under the North York moors.

 

Read More – www.theguardian.com

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OneTrust doubles valuation to $2.7B as consumer data laws go global

Global data privacy laws are quickly minting a new sector in software.

Privacy tech startup OneTrust has raised $210 million in a Series B led by Coatue and Insight Partners. The round values the company at $2.7 billion, just eight months after it raised a $200 million Series A at a $1.3 billion valuation.

OneTrust, based in Atlanta and London, is part of a cohort of startups capitalizing on the growing demands that privacy regulations are placing on businesses. Europe’s GDPR set off a cascade of regulatory efforts around privacy, and the California Consumer Privacy Act took effect this year. Similar efforts are being implemented or considered in other US states and around the world.

OneTrust isn’t the only startup to find itself suddenly flush with cash to tackle privacy concerns. San Jose-based Securiti.ai raised $81 million within a year of launching, and fellow data governance firms AvePoint and TrustArc also recently secured large financing rounds.

“This is a space that didn’t really exist four years ago,” said Alan Dabbiere, OneTrust chairman and the founder and former chairman of AirWatch. The significant war chest will allow OneTrust to build its offerings through acquisitions; last year, the startup snapped up two privacy businesses.

The money also demonstrates to potential customers that OneTrust is credible and viable, said Dabbiere. Those characteristics are vital to winning the kinds of large contracts with multinational organizations that the company is targeting.

“The market really rewards platforms,” Dabbiere said. “We are really the first true platform in privacy.” OneTrust says it has grown to 1,500 employees serving 5,000 customers around the world, including nearly half of the Fortune 500, in less than four years.

As demonstrated by the record $5 billion fine imposed on Facebook by the Federal Trade Commission last year, the cost of violating consumer privacy is higher than ever. But even as compliance becomes more stringent, Dabbiere believes that companies’ desire for customer data is only growing. However, they also want to manage that data responsibly and avoid relying on major tech firms to obtain it.

Wherever the fear of regulation meets the desire for data is an opportunity for privacy-focused companies. “What you’ve got is CEOs that have one foot on the gas and one foot on the brake, saying ‘I want to get closer [to customers], but I don’t want to risk my business.’ And I think this is really what’s driving our business,” said Dabbiere.

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European VC enters mega-fund land as Atomico closes on $820 million

Europe’s ever-growing startup ecosystem is prompting venture capitalists to raise ever-larger war chests.

The latest is Atomico, the London-based firm created by Skype co-founder Niklas Zennström, whose team on Tuesday unveiled a final close on $820 million for its fifth fund, a record-setting haul on the heels of a historic year for the European venture market.

Atomico’s new fund marks the largest for an independent venture firm based in Europe, which saw an all-time high of $11.2 billion in VC fundraising industrywide last year, according to PitchBook data. And the typical fund is getting bigger, with the median size rising to an unprecedented $105 million, a trend that is fueling larger funding rounds for startups in Europe and the US alike. European firms Northzone Ventures and Balderton Capital raised $500 million and $400 million funds respectively in late 2019.

For Atomico, the new vehicle is $55 million bigger than its predecessor, Fund IV, which in 2017 hauled in $765 million in the aftermath of the UK’s historic referendum to leave the European Union. The early-stage firm has backed companies like mobile-game developer Supercell, artificial-intelligence specialist Graphcore, and payment platform Klarna.

Atomico partner Hiro Tamura said that despite the bigger fund size, the firm’s strategy remains the same as its fourth fund, albeit serving a European VC market that is more crowded than in past years.

“There will be more competition and there will be more people vying for similar returns,” Tamura said. “I think we will continue to occupy what I think is a very effective zone for us, that is Series A and late venture rounds.”

Atomico acts as lead investor in Europe with a remit that also extends to the US, where it acts as a co-investor. Its new fund, first announced in 2018, also will write checks for Series B and C deals.

Tamura said Atomico’s strategy is to bet on startups in both business and consumer markets, including investments related to payments platforms and deep tech. Its new fund has already started to deploy capital, investing in startups such as diagnostics provider Kheiron Medical, employee-retention specialist Peakon and sales-software platform Automation Hero.

 

Read More – www.pitchbook.com

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10 big things: Blue Apron, HQ Trivia move on to Plan B

Blue Apron set out to transform the way people eat. HQ Trivia wanted to build the future of TV. Both companies financed their dreams by raising a lot of money from some of venture capital’s biggest names. And for a while, both companies seemed on the brink of breaking through.

But startup life can be fickle. Gradually, the early success gave way not to failure, but to what’s in some ways worse: irrelevance. And when the next-big-thing buzz wore off, both Blue Apron and HQ Trivia were confronted with the realization that their original plans for supremacy might need a major adjustment.

Blue Apron is publicly seeking a buyer, and HQ Trivia has apparently risen from the dead after a raucous, live-streamed funeral. The existential angst emanating from a pair of former Silicon Valley darlings is one of 10 things you need to know from the past week:

1. Cooks and questions

I’ve written before in some length about the turbulent times at Blue Apron, a company that encapsulates the venture capital world’s brief infatuation with meal-kit delivery startups. This week, along with its Q4 earnings, the company announced it is evaluating strategic options, including a potential merger or outright sale.

Once valued at $2 billion by VCs, life has gotten much tougher for Blue Apron since a 2017 IPO. The company has never turned an annual profit—although it did cut its losses by nearly half from 2018 to 2019, dropping from $122.1 million to $61.1 million—and revenue has been steadily shrinking.

In addition to revealing new financial numbers and plans to sniff around a sale, Blue Apron also announced the closure of a fulfillment center this week. The combination was enough to send the company’s stock price plummeting even further. It closed Friday with a market cap of less than $40 million, meaning its valuation has declined by more than 98% from its VC-backed high point.

If Blue Apron is able to find a buyer, two obvious options might be an established grocery chain or a larger food-delivery company. Those were the routes taken by some of Blue Apron’s former rivals in recent years: Fellow meal-kit startup Plated sold itself to Albertsons, while Home Chef was acquired by Kroger and Maple was gobbled up by Deliveroo.

Talks of an acquisition were also at the root of HQ Trivia’s recent drama.

The startup burst onto the scene in 2017 with its joke-filled, live-streamed trivia games, where users could win money by correctly answering an increasingly difficult slate of questions. The next year, it raised $15 million in a round reportedly led by Founders Fund, valuing the company at $100 million, according to PitchBook data.

Co-founder Rus Yusupov, who previously co-founded Vine, took to the pages of The New York Times to proclaim HQ Trivia’s “ambitions to essentially build the future of TV.” But instead, viewers slowly began to drift away, and funding dried up.

On Valentine’s Day, Yusupov reportedly sent a memo to workers announcing that a planned acquisition had fallen through and that HQ Trivia would cease operations that day. That night, HQ Trivia broadcast what was purportedly its last episode ever, replete with f-bombs, spraying champagne, complaints about high-priced dog food, and statements from host Matt Richards like, “Why are we shutting down? I don’t know. Ask our investors.”

But Monday morning brought a twist. Yusupov tweeted that after a “busy weekend,” he’d found a new buyer for HQ Trivia that wanted to keep the company up and running. Employees and fans are surely trying not to dwell on a succeeding tweet from Yusupov admitting that it’s “[n]ot a done deal yet.”

No matter what happens, we haven’t heard the last of the story. The Hollywood Reporter indicated Friday that The Ringer is planning a new podcast charting the trivia company’s rise and fall.

Today, neither Blue Apron nor HQ Trivia is where they hoped they would be back in 2017. One could go so far as to say recent events at the companies have been disastrous. But the fact remains that both have been more successful than, I don’t know, 97% of all startups that get up and running. Creating a sustainable company is really hard. Almost everyone fails. And almost everyone fails long before the point of making national headlines or reaching a unicorn valuation.

And who knows: Maybe new ownership is all Blue Apron and HQ Trivia need to mount wholesale turnarounds. The past week, though, brought plenty of reason for pessimism.

Grocery shopping may very well be transformed in the coming years, and a new future of TV may be built. But I don’t think Blue Apron and HQ Trivia will be the ones doing it.

Read More – www.pitchbook.com

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Optiv confirms ‘temporary’ UK closure and turns attention to M&A

Security giant says it is still committed to European expansion

US-based MSSP Optiv has confirmed what it called a “downsizing” of its UK operation, claiming the move is temporary as it turns its attention to M&A.

CRN reported yesterday that Optiv was in the process of shutting down in the UK, keeping on a handful of staff to continue any outstanding customer transactions.

 

In a statement Optiv called the move “temporary”, insisting that it still has plans to build a presence in Europe and has looked at 40 European businesses to acquire before deciding it “simply couldn’t justify the high valuations of these companies”.

“After a comprehensive strategic review, we’re temporarily downsizing our London-based organic operations,” Optiv said.

“We remain committed to serving the European market, clients, partners and prospects,” it added, claiming it could acquire “once European valuations right-size”.

Optiv’s CMO had previously said that the firm looked at acquiring the likes of SecureData and SecureLink, opting against making a bid because it thought the pair were overvalued.

SecureData was bought last year for a multiple of 20 times its EBITDA.

Micky Patel – partner at August Equity, which sold SecureData to Orange – told CRN earlier this year that the multiple was achieved because SecureData was unique in that it was a cybersecurity service provider that had scaled.

A panel of private equity investors also told delegates at CRN‘s Channel Conference MSP that they believe high multiples are here to stay.

 

Read More – www.channelweb.co.uk