Oct 24, 2019

Axios Pro Rata

By Dan Primack
Dan Primack
Top of the Morning

Illustration: Rebecca Zisser/Axios

Saudi Arabia hasn't yet announced speakers for its giant investment conference, even though it begins next Tuesday, but Axios' Felix Salmon obtained a draft program.

  • It includes several high-profile investors and bankers who had originally agreed to be part of last year's event, but who then bailed in the aftermath of Jamal Khashoggi's murder.
  • For example: The Blackstone Group CEO Steve Schwarzman, BlackRock CEO Larry Fink, SoftBank CEO Masayoshi Son, Standard Chartered CEO Bill Winters, and Credit Suisse CEO Tidjane Thiam.
  • As we've previously discussed, nothing substantive has changed over the past year with respect to Khashoggi.
  • Then there's Bloomberg News, which inexplicably agreed to put several of its reporters on stage as moderators, before pulling the plug at the last minute (possibly as late as yesterday, after Felix called them about it).

This isn't any ordinary billionaires convention. It's organized by the Saudi government, for the purpose of increasing its visibility and centrality among global investors.

Speaking at Davos in the Desert is validation for Saudi Crown Prince Mohammed bin Salman. A mulligan for murder. Not at all the same as Switzerland's role in the World Economic Forum, for example, nor even standing on the Riyadh sidelines to meet up with regional contacts. When Saudi Arabia wants to promote its business interests, expect it use photos of Larry Fink sitting on its stage.

When asked for what caused their change of heart between 2018 and 2019, reps for Steve Schwarzman and Masa Son sent back "no comment."

But don't worry. Their presence next week will say much more than a carefully-worded press statement ever could.

Source: Giphy

Prosus, a listed Dutch Internet group controlled by Naspers, offered $6.3 billion in cash to buy British food delivery company Just Eat (LSE: JE), which previously agreed to an all-stock takeover by Takeaway.com.

  • Why it's the BFD: Because this illustrates the competitive risks of all-stock buyout offers. Takeaway's original bid valued Just Eat shares at 731 pence each, but Takeaway's subsequent stock slump reduced that value by nearly 19% to just 594 pence. Prosus, meanwhile, is offering 710 pence per Just Eat share.
  • State of play: Just Eat's board has already rejected Prosus' unsolicited bid, claiming it "significantly" undervalues the company. If we assume that Just Eat has enough abacuses to calculate that 710 > 594, their argument must be that synergies with Takeaway could make shareholders richer in the long-term. Don't be surprised if some major Just Eat backers would prefer the bird in hand.
  • Bottom line: "Naspers has made little secret of its ambitions to become a global presence in internet food delivery. The group controls Latin America’s biggest food delivery app iFood, in which it is partnered with Just Eat as an investor. It has invested hundreds of millions of dollars in India’s Swiggy." — The Financial Times
Venture Capital Deals

Blueground, a New York-based apartment rental startup, raised $50 million in Series B funding co-led by WestCap Investment Partners and Prime Ventures. http://axios.link/PQfw

Very Good Security, a San Francisco-based data privacy platform, raised $35 million in Series B funding. Goldman Sachs led, and was joined by return backers Andreessen Horowitz and Vertex Ventures. http://axios.link/YKUU

Coople, a European on-demand staffing platform, raised $32 million co-led by One Peak Partners and Goldman Sachs. http://axios.link/vSqc

Triller, a Los Angeles-based music video platform, raised $28 million in Series B funding led by Proxima Media. http://axios.link/Iamb

Grafana Labs, a New York-based open source time-series analytics platform, raised $24 million in Series A funding. Lightspeed Venture Partners led, and was joined by Lead Edge Partners. www.grafana.com

Truebill, a San Francisco-based personal finance management app, raised $15 million in Series B funding. Eldridge Industries led, and was joined by Evolution VC and return backers Cota Capital and Lucas Venture Group. http://axios.link/uWK5

Fairmarkit, a Boston-based tail-spend management platform, raised $11 million in Series A funding led by Insight Partners. http://axios.link/njNh

🚑 Gallant, a stem cell bank for dogs, raised $11 million from Maveron, Bold Capital Partners, Bling Capital, and Science Inc. www.gallant.com

Bespoke Financial, a Los Angeles-based short-term lender for the cannabis industry, raised $7 million led by Casa Verde Capital. http://axios.link/JTh3

Tines, an Irish cybersecurity automation startup, raised $4.1 million in Series A funding led by Blossom Capital. http://axios.link/s4dH

OctoML, a Seattle-based SaaS startup for automating machine learning optimization, raised $3.9 million. Madrona Venture Group led, and was joined by Amplify Partners. http://axios.link/co6Y

Demodesk, a German screen-sharing platform for online sales meetings, raised $2.3 million in seed funding from GFC, YC, and Kleiner Perkins. http://axios.link/5vbe

Private Equity Deals

Anchorage Capital Partners agreed to buy Australian rail transport company CF Asia Pacific for around $250 million, per The Australian.

Hillhouse Capital, Permira, and Warburg Pincus are among suitors for the Chinese operations being sold by Switzerland’s EF Education First for between $1.5 billion and $2 billion, per Bloomberg. http://axios.link/swI6

Infogain, a Los Gatos, Calif.-based portfolio company of ChrysCapital, bought Seattle-based digital consultancy Revel Consulting. http://axios.link/Qqt6

New Capital Partners invested in SMR Worldwide, a Charlotte-based provider of ITAD and e-waste solutions. www.smartmetalsrecycling.com

US Grid Co., a New York-based urban power plant owner and operator, received private equity funding from EnCap and Yorktown Partners. www.usgrdco.com

• Vance Street Capital acquired Eirtech Aviation Services, an Ireland-based provider of aviation services for airlines and aircraft leasing companies. www.eirtechaviation.ie

White Deer agreed to buy TorcSill, a Pasadena, Texas-based maker of helical piles for the energy market, from Intervale Capital. www.torcsill.com

Public Offerings

BRP Group, a Tampa, Fla.-based insurance brokerage, raised $230 million in its IPO. It priced 16.4 million shares at $14 (low end of range), for a fully-diluted value of $908 million. The company will trade on the Nasdaq (BRP) with JPMorgan as lead underwriter. www.brp.com

Fangdd Network Group, a Chinese online real estate trading platform, set IPO terms to 7 million shares at $13-$15. It would have a fully-diluted market value of $1.2 billion, were it to price in the middle, and plans to trade on the Nasdaq (DUO) with Morgan Stanley as lead underwriter. Fangdd reports $14.6 million of net income on $50 million in revenue for the first half of 2019, and had raised over $300 million in VC funding from firms like Sky9 Capital, FountainVest Partners, CyberAgent Ventures, CPPIB, Vision Knight Capital Partners, Lightspeed China Partners, and CDH China. http://axios.link/XGR8

GFL Environmental, a Canadian liquid waste management firm backed by BC Partners and Ontario Teachers’ Pension Plan, set IPO terms to 87.6 million shares at $20-$24. It would have an initial market cap of $6.9 billion, were it to price in the middle, and plans to trade on the NYSE and TSX under ticker GFL. http://axios.link/QGlc

SITime, a Santa Clara, Calif.-based MEMS company being spun off of Japan’s MegaChips, filed for a $100 million IPO. It plans to trade on the Nasdaq (SITM) with Barclays as lead underwriter, and reports a $7 million net loss on $56 million in revenue for the first nine months of 2019. http://axios.link/LYou

Liquidity Events

PTC (Nasdaq: PTC) agreed to buy Onshape, a Cambridge, Mass.-based 3D CAD platform, for $470 million. Onshape had raised $145 million, most recently in 2016 at around an $800 million post-money valuation in a Series D round led by Andreessen Horowitz. Others backers include NEA, North Bridge Venture Partners, and Commonwealth Capital Ventures. http://axios.link/Xq4r

More M&A

🚑 Amazon (Nasdaq: AMZN) acquired Health Navigator, a La Grange, Ill.-based provider of APIs for online health services. http://axios.link/PiyP

• Fuji Xerox offered to buy Australian printing services provider CSG (ASX: CSCV) for A$139 million. http://axios.link/pwmh

Rothschild & Co. agreed to buy the UK business of Chicago-based M&A advisory firm Livingstone. www.livingstonepartners.com

• Samuel Ben-Avraham, an Israeli businessman, said he submitted a rival bid for bankrupt luxury retailer Barneys, which recently agreed to a $271 million takeover by Authentic Brands. http://axios.link/y4s5

It's Personnel

Lisa Gersh (ex-CEO of Alexander Wang) and Gary Newman (ex-CEO of Fox Networks Group) joined media-focused Attention Capital as executive partners. http://axios.link/2TND

Doug Hill joined private equity firm The Halifax Group as a partner. He previously was a managing director with Nautic Partners. Halifax Group also promoted David Calder to principal. www.thehalifaxgroup.com

🚑 Tim Leahy joined Concord Health Partners as a managing director, after having previously been with BelHealth Investment Partners. www.concordhp.com

Kell Reilly joined General Atlantic as a Palo Alto-based managing director focused on tech deals. He previously co-led TMT for hedge fund D1 Capital Partners. www.generalatlantic.com

🚑 Steven St. Peter joined by JDRF T1D Fund, a venture philanthropy fund focused on Type 1 diabetes, as a managing director. He’s a onetime MPM Capital investor who recently founded by led Aratana Therapeutics. www.t1dfund.org

Final Numbers
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Data: Pitchbook; Chart: Axios Visuals
Dan Primack

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