Top of the Morning
Breaking: Elliott Advisors has offered to buy AthenaHealth for between $155-$160 per share in cash, per CNBC's David Faber. That's at least a 23% premium on Friday's closing price, representing a market value of between $6.26 and $6.4 billion.
- Elliott last year acquired a 9.2% stake in AthenaHealth, saying it was open to a variety of changes (including management shakeups or a company sale). AthenaHealth profits have since improved.
- The healthcare software company is led by founder and CEO Jonathan Bush, cousin of George W. and Jeb.
- Leaving aside the strategic specifics here, it's yet another indication that Elliott is no longer satisfied being an activist investor. It wants to be an owner.
• Carbon Black went public on Friday, raising $152 million in its IPO and closing its first day of trading up 26%. We took a look at the cybersecurity company's 16-year road to the public markets, including:
- One of its earlier office spaces was inside a shopping mall on the east side of Cambridge, Mass., where employees included future Dropbox founder and CEO Drew Houston.
- Carbon Black originally prepped for its IPO two years ago (even picking bankers), but then postponed so that it could purchase and integrate an antivirus company called Confer.
- Investor and board member Paul Maeder: "The two worst things to be as a startup is too early or too late. Too late you can't recover from, but you can survive too early if you have a great CEO and loyal investors."
• Speaking of IPOs: Construction Partners didn't fare too well last week, pricing at $12 (below $15-$17 range) and closing at $12.10. But this may prove to be an interesting bellwether, given that its focus is on road construction and repair in the oil-rich Southeastern U.S.
- Gabriel Collins, a fellow at the Baker Institute Center for Energy Studies, writes for Axios about how oil and gas production is having a devastating effect on Texas roads.
• OracleCoin: Warren Buffett this morning said on CNBC that Bitcoin is "probably rat poison squared."
- Buffett also continued his private equity bashing, without acknowledging that Berkshire Hathaway has repeatedly partnered with private equity firm 3G Capital on massive leveraged buyouts.
• Next act: Scott Connors has returned to private equity after a multi-year hiatus, per his LinkedIn account. Connors spend 22 years with Landmark Partners, including as co-head of PE secondaries, before retiring in mid-2015. Now he's joined Cresset Partners, an affiliate of Chicago-based wealth management firm Cresset, as a managing director and head of sponsor products. The firm also recently hired Landmark vet Jason Neal as director of biz dev.
Nestlé (SWX: NESN) has agreed to pay $7.15 billion in cash to Starbucks (Nasdaq: SBUX) for the right to sell the coffee company’s products in non-Starbucks shops around the world.
- Why it's the BFD: Because this is a major escalation in Nestlé's legalized stimulant battle with JAB Holding, which has seen Nestlé buy Blue Bottle and JAB purchase both Keurig Green Mountain, Douwe Egberts and Peet’s.
- Bottom line: "Coffee is popular with younger customers who have grown up with Starbucks. A willingness to pay up for exotic beans and specialty drinks means companies can brew up richer profit margins than in mainstream packaged food." — Reuters
Venture Capital Deals
🤖 Ubtech Robotics, a Chinese developer of consumer robots for entertainment and educational purposes, says it raised $820 million in Series C funding at around a $5 billion valuation. Tencent led, and was joined by Industrial and Commercial Bank of China, Minsheng Securities, Telstra, Haier Group, Green Pine Capital Partners, CreditEase and return backer CDH Investments. http://axios.link/nfqL
• Mesosphere, a San Francisco-based hybrid cloud platform company, raised $125 million in new funding. T. Rowe Price and Koch Disruptive Technologies co-led, and were joined by ZWC Ventures, Qatar Investment Authority, Disruptive Technology Advisers and return backers Andreessen Horowitz, Two Sigma Ventures, Khosla Ventures and HP Enterprise. http://axios.link/h9J2
🚑 Moderna Therapeutics, a Cambridge, Mass. mRNA drug discovery and development company, has raised $125 million in new strategic funding from Merck, through the expansion of an existing mRNA cancer vaccine partnership. Moderna raised $500 million in VC funding earlier this year at a $7.5 billion valuation. http://axios.link/PhnO
• Shenna Finance, a Chinese fintech startup focused on providing vehicle financing in rural areas, raised around $47 million in Series C funding from China Growth Capital, Hina Group, Tongbanjie Group and return backers Credit Ease Financial Industry Investment Fund and ChinaEquity Group. http://axios.link/ueY1
🚑 Lyra Health, a Burlingame, Calif.-based behavioral health tech company led by former Facebook CFO David Ebersman, raised $45 million in new funding. Tenaya Capital, Glynn Capital Partners, Crown Ventures, and Casdin Capital were joined by return backers Venrock, Greylock and Providence Ventures. http://axios.link/5FOX
• Divvy, a Lehi, Utah-based real-time expense monitoring platform, raised $10.5 million in Series A funding led by Pelion Ventures. http://axios.link/fhM0
• StratiFi Technologies, a San Francisco-based decision-making platform for investors, raised $7 million in Series A funding. Anthemis Group led, and was joined by Wolverine Holdings, Cboe Global Markets, HOF Capital and AngelList. www.stratifi.com
• iPrice, a meta e-commerce site aggregator for Southeast Asia, raised $4 million in new VC funding. Line Ventures led, and was joined by return backers Cento Ventures and Venturra Capital. http://axios.link/vbQ2
• Purple Carrot, a Needham, Mass.-based meal kit company, raised $4 million from Fresh Del Monte Produce. www.thepurplecarrot.com
• Learning Machine Technologies, a blockchain-based records and identity platform, raised $3 million in seed funding. PTB Ventures led, and was joined by Omidyar Network and Learn Capital. www.learningmachine.com
Private Equity Deals
• The Blackstone Group has agreed to buy commercial property manager Gramercy Property Trust (NYSE: GPT) for $7.6 billion. http://axios.link/t5z0
• Gemspring Capital has acquired an equity stake in A10 Capital, a Boise, Idaho-based provider of middle-market commercial real estate loans. Existing shareholders include H.I.G. Capital. www.a10capital.com
• General LED, a San Antonio-based portfolio company of The CapStreet Group, has acquired Acolyte Group, a New York-based provider of architectural LED lighting systems. www.generalled.com
• RugsUSA, a Cranbury, N.J.-based online rug and home décor retailer, raised an undisclosed amount of funding from Comvest Partners.
• 5 companies expect to price IPOs on U.S. exchanges this week, led by AXA Equitable’s $3.5 billion offering. Other likely issuers are: Huya, Abpro, Evolo Biosciences and Origin Bancorp. http://axios.link/vI7t
🚑 Aslan Pharmaceuticals, a Singapore-based oncology therapeutics developer, raised $42 million in its IPO. It priced 6 million shares at $7.03, down from plans to offer 7.5 million shares (price was tied to Taiwan Stock Exchange price – although it now will also trade on Nasdaq).
• Fusion Telecom (Nasdaq: FSNN) has completed its previously-announced $600 million purchase of the cloud and business services unit of Atlanta-based Birch Communications from Birch Equity Partners.
• Mondelez International (Nasdaq: MSLZ) has agreed to acquire Tate’s Bake Shop, a Southhampton, N.Y.-based cookie maker, from The Riverside Company for around $500 million. http://axios.link/GuR9
• Nokia has acquired SpaceTime Insight, a San Mateo, Calif.-based provider of visual analytics software that raised around $90 million in VC funding from firms like Zouk Capital, Opus Capital Ventures, EnerTech Capital, Novus Energy Partners, E.ON Strategic Co-Investments and NEC. http://axios.link/FVoi
• Reece (ASX: REH) has agreed to acquire Morsco, a Fort Worth, Texas-based plumbing supplies company, for $1.44 billion (including debt) from shareholders like Advent International. http://axios.link/IrJ5
🚑 Allscripts (Nasdaq: MDRX) has acquired HealthGrid, an Orlando-based mobile patient engagement platform, for upwards of $110 million ($60m in cash). http://axios.link/kp76
• International Flavors & Fragrances (NYSE: IFF) has agreed to acquire Israeli flavors and ingredients maker Frutarom (TA: FRUT) for $7.1 billion in cash and stock. http://axios.link/hZOE
• Third Point believes industrial conglomerate United Technologies (NYSE: UTX) should break up, and says it has shared its views with the company’s board of directors. http://axios.link/QwSm
• Backstage Capital, a VC firm focused on under-represented founders, raised $36 million for its new fund. http://axios.link/50kh
• The Carlyle Group is nearing a $6.5 billion final close on its latest Asia buyout fund, per Reuters, and also is raising a new yuan-denominated fund to focus only on China. http://axios.link/iH2L
• CICIIF, a state-owned investment group in China, has partnered with Hong Kong-listed foundry SMIC to form a $255 million equity fund focused on semiconductor companies. http://axios.link/Q4ka
• Argand Partners promoted Joseph Del Toro to partner. www.argandequity.com
• Vincent Buffra (former CEO of Data Device Corp.) has joined Behrman Capital as an operating partner, and board director with Behrman portfolio companies Corfin Industries and ILC Dover. www.behrmancap.com
• Daniel Jones has stepped down as a partner with Global Founders Capital, according to TechCrunch. He may be planning to raise his own fund. http://axios.link/pJw8
• Dan Strong has joined Warren Equity Partners as director of operations. He previously was with Platinum Equity. www.warrenequity.com
• Hongjiang Zhang (former CEO of Kingsoft) has joined The Carlyle Group as a senior advisor to its Asia private equity business. www.carlyle.com