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Marsh & McLennan Buys UK Insurance Firm JLT In $5.6bn Deal

FTSE 250 insurance firm JLT has accepted a $5.6bn (£4.3bn) takeover offer from US financial services giant Marsh & McLennan.

Shares in JLT, which employs more than 4,000 people in the UK, soared 32 per cent in early trading on Tuesday after the deal was announced.

The bid values JLT at $6.4bn and will see the company’s shareholders receive £19.14 per share, a premium of almost 34 per cent to the closing price on Monday.

Marsh employs more than 65,000 people around the world, with operations in 130 countries.

The company said it expects the deal will help it reduce expenses by around $250m, partly through job cuts.

Based on preliminary evaluations, Marsh said, it expects a potential headcount reduction of between 2 and 5 per cent of the combined group’s workforce. JLT employs more than 10,000 people, meaning the potential number of jobs lost could be more than 3,500.

Marsh chief executive Dan Glaser said the acquisition “creates a compelling value proposition for our clients, our colleagues and our shareholders”.

“The complementary fit between our companies creates a platform to deliver exceptional service to clients, and opportunities for our colleagues,” he said.

“On a personal level, I have come to know and respect Dominic Burke and his management team from my time both at MMC and as an underwriter. I am confident that with the addition of the talented colleagues of JLT, Marsh & McLennan will be an even stronger and more dynamic company.”

Mr Burke, JLT’s chief executive, said: “I am enormously proud of what JLT has achieved, founded on our people, our culture and our unwavering commitment to our clients. MMC is, and always has been, one of our most respected competitors and I believe that, combined, we will create a group that will truly stand as a beacon for our industry.”

Read More – www.independant.co.uk

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Slack Makes Third Acquisition In 3 Months

In its latest acquisition, messaging powerhouse Slack has picked up Astro.

The move is part of Slack’s mission to bundle up workplace communication into one place. Astro, founded out of Palo Alto in 2015, is the maker of an AI-powered app that allows email and calendar information to be viewed directly from Slack’s messaging interface, essentially providing a way for workers to check all their messages in the same place without moving between apps. With the acquisition, Astro’s tech will be rolled into Slack’s platform.

Slack has acquired five companies—including Astro—since it was founded in 2009, per the PitchBook Platform. Notably, three of those acquisitions have occurred since the beginning of the summer.

In July, Slack picked up Missions, an app developed by Robots & Pencils that allows users of Slack to automate routine tasks. Later that same month, the San Francisco-based company agreed to acquire Hipchat and Stride, two of Atlassian’s messaging products. As part of that deal, Slack is integrating the collaboration apps into its own product, much like it’s doing with Astro.

Pre-2018, Slack had made just two acquisitions in nine years. Its first ever was Spaces, a collaboration startup it picked up in 2014. The following year, Slack bought Screenhero, a startup that developed a platform for users to access one another’s screens. The deal for Astro is reportedly the biggest of Slack’s acquisitions, and most of the company’s 28 employees are said to be joining Slack upon the deal’s closing.

The deal comes a month after Slack announced a major new fundraise. The company brought in $427 million at a valuation of more than $7.1 billion in late August, further solidifying its ranking as one of the most valuable VC-backed companies in the US.

From Astro’s perspective, the acquisition represents an exit for its investors, which include Redpoint Ventures and Aspect Ventures. The company raised more than $8 million in a Series A funding last year.

 

Read More – www.pitchbooks.com

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Uber’s CEO on his first year

SAN FRANCISCO—Before Dara Khosrowshahi became CEO of Uber a year ago, the ridehailing company was in the process of cleaning up its image after a rough year—and bringing on the former Expedia chief as its leader was a big part of its strategy.

Now, almost exactly a year has passed since Khosrowshahi was installed in the CEO seat—enough time that he’s no longer referred to as Uber’s “new CEO” or “Travis Kalanick’s replacement.” Khosrowshahi took the stage at TechCrunch Disrupt 2018 to discuss how Uber has evolved since he took on the big job last September, from major personnel changes to a move into scooters to a renewed focus on diversity.

“I had no frickin’ clue what I was getting into,” Khosrowshahi said of his decision to take on the top job, adding that overall he feels positive about the progress the company has made. “It’s been a year. So far, so good.”

 

Read more – www.pitchbooks.com

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CVC Lining Up Major Exits From Fund VI

In 2013, CVC Capital Partners raised €10.9 billion (about $12.7 billion at today’s conversion rate) for its sixth flagship vehicle. Now, five years later, the firm is in the process of arranging a pair of significant sales from the mega-fund.

PDC Brands, a provider of beauty and personal care products that CVC bought for $1.43 billion last year, is working with advisors on a public offering in the US for some time next year, according to Bloomberg.

The company behind the Dr. Teal’s, Cantu and Bod brands had been owned by Yellow Wood Partners until CVC used cash from its sixth fund to conduct a takeover. CVC reportedly took out a loan against PDC in December in order to pay itself a dividend.

Separately, CVC and company founder Joop van den Ende have agreed to sell Stage Entertainment, an owner and operator of theaters in the US and Europe, to Advance Publications, a longtime media investor.

CVC used cash from its sixth flagship fund to acquire a 60% stake in the business in 2015, a deal reportedly valued around €400 million. The firm had reportedly considered an IPO for Stage Entertainment earlier this year before striking a sale pact.

We’ve got more coverage of PE exits.

www.pitchbooks.com

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Saudi wealth fund weighing $1B investment in Tesla rival

After an especially tumultuous couple of weeks for Tesla, Elon Musk’s potential buyout partner is apparently looking to obtain a majority stake in another electric car company.

The Public Investment Fund of Saudi Arabia is considering an investment in Lucid Motors, a Newark, CA-based electric car maker, that could total more than $1 billion and give the fund ownership of the company, according to Reuters.

Under the terms of the agreement, the Saudi Arabian sovereign wealth fund, which manages some $250 billion, would reportedly provide an initial investment of $500 million, then make two subsequent investments if Lucid hits certain production targets.

Founded in 2007 by former Oracle executive Sam Weng and former Tesla vice president Bernard Tse, Lucid is backed by VCs including Venrock and Tsing Capital. Unlike Tesla, the company has yet to release any cars on the open markets. But last year, Lucid unveiled a prototype sedan, Lucid Air, which has 400 horsepower and a starting price of $60,000. The car is expected to ship sometime in 2019.

The potential Saudi Arabia PIF-Lucid partnership could be problematic for Musk, who already appears stressed. Last week, the billionaire entrepreneur gave an interview with The New York Times in which he alternated between laughing and crying while detailing the pressures of running Tesla.

The latest controversy came when Musk himself tweeted earlier this month that he planned to take the business private for $420 per share, or about $72 billion, noting that funding was secured.

Musk later clarified in a blog post that the Saudi Arabia wealth fund, which owns a 5% stake in Tesla, was the potential backer, though no formal agreement had been made. The company is now reportedly facing a subpoena from the SEC and lawsuits from investors that allege Musk’s tweet aimed to inflate the company’s stock price. Tesla stock initially dipped Monday before closing the afternoon up just about 1% at $308.44 per share.

 

Read Full Article – www.pitchbooks.com

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BP To Buy BHP’s US Shale Oil And Gas Assets For $10.5bn

BP has agreed to buy US shale oil and gasfields from the Anglo-Australian miner BHP for $10.5bn (£8bn), in the UK firm’s biggest acquisition in nearly two decades.

Bob Dudley, BP’s chief executive, lauded the deal as transformational and industry watchers said the move significantly beefed up the company’s US shale presence, which was small compared to peers.

The acquisition will boost BP’s US oil and gas production by nearly a fifth and marks a new period of growth for the company, which is emerging after years under the $65bn burden of the Deepwater Horizon disaster.

In total, 470,000 acres of assets are covered in the deal, including fields in the Permian in west Texas, the Eagle Ford in south Texas and Haynesville in east Texas and Louisiana.

Analysts said Eagle Ford was the most valuable of the three because of its scale and economics, while the Permian offered the greatest long-term promise.

Read Full Article – www.theguardian.com

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House Of Fraser Cancels All Online Orders!

Beleaguered British department store House of Fraser is cancelling all online orders and will be refunding thousands of customers potentially millions of pounds after a dispute with its warehouse operator held up deliveries.

The decision comes “after the chain’s website was taken offline amid complaints from customers about delayed deliveries since the company was bought by Sports Direct for £90m last week”, says Sky News.

XPO logistics, which operates a House of Fraser distribution centre in Wellingborough, “has told employees to stop accepting orders from the department store”, reports The Times.

 

House of Fraser has told over 1,000 suppliers it will not pay money owed before 10 August, when Sports Direct bought the chain out of administration.

But XPO has halted work as it tries to convince Sports Direct to honour existing contract terms.

“We have taken the decision to cancel and refund all orders that have not already been sent to customers,” the department store said on Facebook.

“We didn’t take this decision lightly, but since we cannot give our customers clear assurances of when their orders will be delivered, we believe cancellation is the best option.”

A source close to Sports Direct told The Guardian it had been forced to cancel orders as XPO was being “totally unreasonable in terms of their demands” and was “refusing to engage in any process” which would “move the situation forward”.

“XPO is trying to hold us to ransom,” the source said.

Sports Direct “has no legal obligation to pay suppliers money owed before its buyout as their debts were part of the administration”, adds the paper, but new owners “often agree to settle at least some of the debts in the interest of good relations”.

The announcement that online orders have been cancelled “has caused anger among customers”, says the BBC.

https://twitter.com/houseoffraser/status/1030125197473599488

Read Full Article – www.theweek.co.uk

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VW CEO Says It Is Open To Alliance Or Merger Of Ducati

Motorbike brand Ducati could be merged with a rival or enter an alliance given a lack of synergy potential with the passenger car businesses at VW, Volkswagen (VOWG_p.DE) Chief Executive Herbert Diess told German daily Handelsblatt.

Volkswagen has struggled to find a long-term solution for the motorbike brand amid internal power struggles, with a 1.5 billion euro ($1.8 billion) auction stalled last year amid resistance from German trade unions.
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“I can imagine a combination or a partnership with other brands. Ducati as a motorbike icon business within the Volkswagen Group is not sufficient,” Diess, who took the helm as Volkswagen chief executive in April, told the paper.

Read Full Article – www.reuters.com

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PepsiCo Buys Sodastream For $3.2Billion

PepsiCo has announced it is buying Sodastream for $3.2bn (£2.5bn).

Israel-based Sodastream makes a machine and refillable cylinders allowing users to make their own carbonated drinks.

The deal gives Pepsi a new way of reaching customers in their homes at a time when its signature sugary drinks are becoming less popular.

It is also the company’s first big acquisition since chief executive Indra Nooyi disclosed she would step down in October after 12 years at the helm.

PepsiCo will buy all outstanding shares of Sodastream for $144 each – almost 11% higher than its closing price in New York on Friday.

The stock has soared 85% this year after rising by 78% in 2017.

The takeover has already been approved by the boards of both firms.

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Ladbrokes Does A $200Million Deal With MGM Resorts

GVC Holdings confirms 50-50 venture in newly liberalised US sports betting market

Earlier this year, the supreme court overturned a gambling ban on sports including basketball and American football.

The UK owner of Ladbrokes and Coral has sealed a $200m (£152m) tie-up with the world’s biggest casino operator, catapulting it into the lucrative, newly liberalised US sports betting market.

On Monday, the FTSE-listed gambling group GVC Holdings confirmed the joint venture with MGM Resorts, giving both partners a foothold in what is forecast to grow into a multibillion-dollar sector.

MGM – best known for Las Vegas casinos such as the MGM Grand and the Bellagio – and GVC have agreed to inject an initial $100m each as part of a 50-50 joint venture focused on US sports betting.

It would make GVC the lead sports betting and online gambling services provider for all MGM’s casino and hotel properties in the US.

Importantly, the deal will allow GVC and MGM to work together to create gambling/betting ventures within newly sanctioned US states, delivering a range of land-based and digital gambling opportunities.

Read Full Article – www.theguardian.com