Synnex seals $7.2bn Tech Data deal

BY Richard Summerfield

IT solutions firm Synnex Corp is to acquire Tech Data for $7.2bn, including debt. The deal will create a combined operation with revenues in the region of $57bn and a headcount of around 22,000 staff.

The terms of the deal will see Tech Data’s owner, Apollo Global Management, take ownership of 45 percent of the combined entity and use it as an opportunity to refinance the distributor’s existing net debt. The companies expect the deal to close in the second half of 2021.

Synnex shareholders will own about 55 percent of the combined company. Tech Data has indicated that it expected net optimisation and synergy benefits of $100m in the first year after closing, with a minimum of $200m by the end of the second year.

“We are excited to partner with a world-class industry leader like Tech Data and believe that this combination will benefit all our stakeholders,” said Dennis Polk, president and chief executive of Synnex. “This transaction allows for accelerated revenue and earnings growth, an expanded global footprint, and the ability to drive significant operating improvements while continuing to create shareholder value.”

"This is transformational for Tech Data, Synnex and the entire technology ecosystem,” said Rich Hume, chief executive of Tech Data. “Together, we will be able to offer our customers and vendors exceptional reach, efficiency, and expertise, redefining the experience and value they receive. The combined company will also benefit from significant financial strength to invest in its core growth platform as well as next generation cybersecurity, cloud, data, and IoT technologies, which are experiencing explosive growth due to work from home and return to office trends.”

Apollo, which wholly owns and manages Tech Data through its funds, will also enjoy certain merger benefits. As per the agreement, Apollo will receive an aggregate of 44 million shares of Synnex common stock plus the refinancing of existing Tech Data net debt and redeemable preferred shares of approximately $2.7bn.

News: Synnex Corp to merge with Tech Data in $7.2 billion deal

Apollo Global and Athene agree $11bn all-stock deal

BY Richard Summerfield

Apollo Global Management Inc has agreed to acquire Athene Holding Ltd in an all-stock deal that values the annuity business at around $11bn.

The deal is expected to close in January 2022, the companies said in a statement on Monday. Apollo was already the annuity seller’s biggest shareholder, with the firm and related entities owning a 35 percent stake in the company.

Under the terms of the deal, each Athene common share will be exchanged for 1.149 shares of Apollo common stock, with Apollo shareholders owning about 76 percent of the combined company once the transaction is completed.

By merging with Athene, the life insurance company Apollo established at the height of the financial crisis, the alternative asset manager will be transformed into a financial conglomerate with a market capitalisation worth almost $30bn.

“This merger is all about alignment between Apollo and Athene, amongst Apollo’s stockholders and with our limited partners,” said Marc Rowan, co-founder and incoming chief executive of Apollo. “For Apollo and Athene, we will have total alignment to optimize our strategy and allocate capital efficiently, which will include rapidly scaling our capability to originate attractive risk/reward assets, which are the limiter of growth for both firms. We have also created alignment among all our stockholders who will share in the upside of a larger, more liquid company with leading corporate governance. And it further aligns interests with our fund investors, giving us a bigger balance sheet to invest alongside clients in our various fund products.”

“Today’s announcement reflects the strength and strategic nature of our longstanding mutually beneficial relationship with Apollo – one which has already created enormous value for each other and our respective constituents,” said Jim Belardi, chairman and chief executive of Athene. “After carefully reviewing Athene’s options to unlock value for shareholders, Athene and Apollo determined that the potential of a fully aligned business would be significantly greater than a sum-of-the-parts.

“Coming together in this merger is a logical and exciting next step that will simplify our relationship while driving significant strategic and financial benefits in both the immediate and long-term future,” he added.

News: Apollo Global to buy annuities provider Athene in $11 billion deal

Las Vegas Sands to cash out of property portfolio

BY Richard Summerfield

An affiliate of funds managed by alternative investment firm Apollo Global Management Inc are to acquire the Las Vegas properties of Las Vegas Sands in a deal worth $6.5bn.

The properties being sold include the Venetian Resort Las Vegas and the Sands Expo and Convention Centre. Apollo Global Management Inc’s affiliate-managed funds will buy the operating company of the Venetian for $2.25bn and VICI Properties will buy the land and real estate assets of the Venetian for $4bn.

The sale will see Las Vegas Sands increase its focus on the increasingly lucrative Asian market, most notably, the world largest gambling hub, Macau. The deal comes just a few months after the death of the company’s then chief executive and chairman, Sheldon Adelson.

“The Venetian changed the face of future casino development and cemented Sheldon Adelson’s legacy as one of the most influential people in the history of the gaming and hospitality industry,” said Robert Goldstein, chairman and chief executive of Las Vegas Sands. “As we announce the sale of The Venetian Resort, we pay tribute to Mr. Adelson’s legacy while starting a new chapter in this company’s history.

He continued: “This company is focused on growth, and we see meaningful opportunities on a variety of fronts. Asia remains the backbone of this company and our developments in Macao and Singapore are the centre of our attention. We will always look for ways to reinvest in our properties and those communities.”

“The Venetian is America’s premier integrated resort, with an unrivalled set of amenities to serve guests across hospitality, meeting events, gaming, and entertainment – categories that we believe are well positioned for strong recovery and long-term growth,” said Alex van Hoek, a partner at Apollo. “The team at Las Vegas Sands, under the leadership and vision of Sheldon Adelson, built an irreplaceable asset that is renowned for its quality, scale and integrated offerings, and we see significant opportunity to invest in and accelerate its growth.

“This investment also underscores our conviction in a strong recovery for Las Vegas as vaccines usher in a reopening of leisure and travel in the United States and across the world,” he added.

“The Venetian is one of the most coveted properties in Las Vegas and a premier destination for gaming, business and leisure alike,” said John Payne, president and chief operating officer of VICI Properties. “We are thrilled to add The Venetian to our roster of best-in-class assets and believe the property is positioned to benefit from a rebound in Las Vegas under Apollo’s leadership. We look forward to what we expect will be a mutually beneficial and productive relationship with Apollo.”

The gambling industry has been badly affected by the COVID-19 pandemic. Sales growth vanished in March 2020 as infections spread across the US. Las Vegas Sands posted a quarterly loss of almost $300m in January.

News: Las Vegas Sands to sell Vegas properties for about $6.25bn

Nestlé to divest water unit for $4.3bn

BY Richard Summerfield

Nestlé S.A. has agreed to sell its Nestlé Waters North America (NWNA) unit to One Rock Capital Partners and Metropoulos & Co. in a deal worth $4.3bn.

In June 2020, Nestlé announced it was conducting a strategic review of the unit, as it planned to sharpen the focus of its global water portfolio. A potential sale to One Rock had been rumoured for a number of weeks.

The sale includes a number of brands in the US and Canada, as well as the US direct-to-consumer and office beverage delivery service ReadyRefresh. Headquartered in Stamford, Connecticut, NWNA has approximately 7000 employees in the US and more than 230 in Canada. The unit also has 27 production facilities across North America.

“We continue to transform our global waters business to best position it for long-term profitable growth,” said Mark Schneider, chief executive of Nestlé. “This sale enables us to create a more focused business around our international premium brands, local natural mineral waters and high-quality healthy hydration products. We will also boost our innovation and business development efforts to capture emerging consumer trends, such as functional water.”

“Nestlé Waters North America’s iconic brands have earned the trust and preference of consumers everywhere due to an uncompromising commitment to quality,” said Tony W. Lee, managing partner of One Rock. “We are excited to further this commitment and build upon the market leadership of the business alongside the Company’s talented management team.”

“One Rock brings to bear extensive corporate carve out and operational capabilities that we believe will be instrumental to NWNA’s ongoing success as a standalone company,” said R. Scott Spielvogel, managing partner of One Rock. “We look forward to working closely with our Operating Partners to accelerate the growth of NWNA’s extraordinary set of attractive brands, while continuing to create value in the communities in which the Company operates.”

“I am pleased to have the opportunity to lead NWNA as it enters the next phase of evolution,” said Dean Metropoulos, founder of Metropoulos & Co. “This is an important inflection point for the business as it transitions to an independent company, and I look forward to collaborating with One Rock and NWNA’s management team to deliver unparalleled value to our customers.”

News: Nestle to sell N.American water brands for $4.3 billion, focus on premium lines

Global Infrastructure Partners agrees $4.63bn Signature Aviation deal

BY Richard Summerfield

Global Infrastructure Partners has agreed to acquire private jet servicing company Signature Aviation in a $4.63bn deal. Global Infrastructure Partners, which co-owns London’s Gatwick airport, has overcome private equity giants Blackstone and Carlyle to acquire Signature Aviation.

Under the terms of the deal, Signature Aviation’s investors will receive $5.50 per share held, according to a statement. The price is above the $5.17 a share approach made last week by Blackstone Group Inc and Bill Gates, Signature Aviation’s biggest shareholder. Mr Gates, who owns 19 percent of the company through his vehicle Cascade Investment, joined Blackstone in its bid to buy the business.

Blackstone or Carlyle (which was exploring a $4.07bn bid for Signature) can still table a new bid for the company.

Signature Aviation offers services such as fuelling and maintenance at airports round the world. Private flying services, such as those offered by Signature, are one of the few travel sectors to have benefited from the coronavirus pandemic as they offer opportunities for travel while minimising potentially risky contact with other passengers.

“Signature, like many businesses in the aviation sector, needs to address the challenges resulting from Covid, whilst market conditions and earnings are likely to remain subdued for some time,” said Adebayo Ogunlesi, chairman and managing partner of Global Infrastructure Partners. “As an experienced, long term infrastructure investor with a strong operational focus, we believe that we are the ideal partner for Signature going forward.”

“Over recent years, the management of Signature has created a leading global private aviation support services business, whilst streamlining the group to maximise value for shareholders,” said Sir Nigel Rudd, chairman of Signature. “We believe that the offer from GIP represents an attractive and certain value in cash today for Signature Shareholders, reflecting the high quality of the business and its network, its people and its future prospects.”

Global Infrastructure Partners had made a lower bid for the company in December, which was rebuffed by Signature.

News: Gatwick Airport co-owner outbids Blackstone to buy Signature Aviation