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15 February, 2019 - 22:56 By Tony Quested

East of England M & A deals hit $15 billion in 2018

East of England companies were involved in Mergers & Acquisitions valued at $13.5 billion in 2018.

That does not include the multimillion values placed on mergers åç in the legal and accountancy professions or a deluge of deals like Oracle’s swoop for Grapeshot (believed to be worth between $300m and $500m) where the companies concerned refused to disclose the sums paid.

The M & As spanned a range of business sectors from agri to food & drink; from manufacturing and services to hi-tech and the life sciences.

Regarding the deals where sums were undisclosed and analysing like-for-like M & As in kindred sectors, these transactions would comfortably have swollen the region’s two-way dealflow in 2018 to $15bn or more.

Imagine the tale we would have been able to tell had Broadcom not been forced to abandon its $146bn bid for Qualcomm in March and had Horizon Discovery accepted an offer valued at $347m from Abcam in May.

It should be swiftly added that almost $11bn of the projected $15bn total we are able to ratify resulted from two high profile international mergers or takeovers.

Those were the $3.8bn merger of industrial software business AVEVA with French company Schneider Electric and the colossal $7.1bn acquisition by International Flavours and Fragrances – quoted on Wall Street but with operations in Haverhill – of Israeli natural ingredients firm Frutarom. Some media called it a merger but IFF was very much in the saddle.

In February 2018, AVEVA clinched a double whammy across the Pond as US regulators sanctioned the merger with Schneider Electric and Shell in Texas sold key design IP for the oil & gas sector to the Cambridge company.
Clearance of the Anglo-French merger triggered a £650 million windfall payout to AVEVA shareholders. 

IFF and Frutarom were flavour of the month with shareholders with their August deal. IFF chairman and CEO, Andreas Fibig, said: “Together, IFF and Frutarom will become a global leader in taste, scent and nutrition, with a broader customer base, more diversified product offerings and increased market penetration. 

Fibig added: “Through our integration planning work, we continue to be confident in the opportunities that lie ahead and the ability of the combination to accelerate profitable growth, enhance free cash flow and generate greater returns for IFF shareholders.”

Also quoted in Paris, IFF works across a range of industry segments and consumer markets and employs 7,300 people globally.

Anchored in Haifa, Frutarom Industries Ltd operates in the global flavours and natural fine ingredients markets. It has significant production and development centres on six continents and sells over 70,000 products to more than 30,000 customers in over 150 countries. 

There were eye catching deals wherever you looked: Among the best of the rest was the $695m sale of facility management company Servest Limited in Bury St Edmunds to French group Atalian in May.

The PwC Cambridge Deals team, led by Stephen Hart, worked closely with Atalian and Servest over a period of months to facilitate the transaction and negotiate associated terms. 

Hart said: “We’re delighted that PwC was closely involved with Atalian and Servest in advising on this important acquisition, which is one of the most significant deals in the East Anglian market so far this year. 

“The UK facilities management market is one of the most dynamic in Europe and the acquisition will allow Atalian to achieve critical mass in the UK while facilitating Servest’s continued organic and acquisition growth strategy. 

“The deal also opens the door to a new range of in technology solution with the potential to drive digital transformation and productivity gains across the workplace and facilities management industry.” 

In August, Cambridge superchip architect Arm further strengthened its proposition in the fast-developing IoT arena with the $600 million acquisition of enterprise data management business Treasure Data in Silicon Valley.

The UK superchip architect said the purchase of a global leader and the simultaneous launch of the new Pelion IoT platform in enterprise data management would create a world-first end-to-end IoT connectivity, device and data management platform for hybrid environments.

Also in August, in what was to become a red hot summer for Cambridge deals, Japanese company Astellas Pharma Inc. paid $109m for Cambridge ophthalmic gene therapy business Quethera Ltd, which is focused on developing novel treatments for ocular disorders, such as glaucoma.

Quethera was co-founded in 2013 by Dr Peter Widdowson and Professor Keith Martin (Professor and Head of Ophthalmology, Department of Clinical Neurosciences, University of Cambridge) and is based at Babraham Research Campus.

There were drinks all round as law firm Howes Percival played a key role in the sale of Suffolk-based cider maker Aspall to American brewing giant Molson Coors for around $51.53m.

The Big Apple took another bite out of Cambridge biotech with a near-$44 million acquisition of Abzena by a newly-formed New York enterprise –  Astro Bidco Limited, a new company wholly-owned by the WCAS Fund in New York.

Abzena CEO John Burt said the acquisition would provide the company with  immediate working capital for the business, followed by additional investment, post completion. 

Abzena provides proprietary technologies and complementary services to organisations involved in the development of biopharmaceutical products.
Pharmaceutical company Vernalis PLC was sold to Ligand Holdings UK for $42m. Ligand is a unit of US-listed biopharmaceutical company Ligand Pharmaceuticals Inc.

Cambridge-based Secure Thingz, a well regarded operator in the IoT arena and a partner of super chip powerhouse Arm, was acquired by Swedish company IAR Systems for just under $26m.

Bug-busting technology company Discuva Limited in Cambridge was sold to Nasdaq-quoted drug discovery and development company Summit Therapeutics in a $13m cash-plus-shares deal.

Among the many ‘undisclosed sum’ deals, Microsoft Studios secured 100 games jobs in Cambridge by acquiring Ninja Theory. 

Law firms Greenwoods and GRM merged to create a £12m legal powerhouse and in the accountancy sector a merger between BDO and Moore Stephens was agreed to create a £590m power player.

Other 2018 deals of significance – sum paid undisclosed unless stated – included:-

  • Hutchison Ports took a 50 per cent stake in TMA Logistics B.V 
  • Bango bought Audiens for $2.38m
  • Armstrong Commercial Laundry Systems was sold to Hughes Electrical 
  • Robinsons MB motor franchises went to Texas giant Group 1 Automotive 
  • Midland Food Group was acquired by Granarolo UK 
  • Priden Engineering was sold to Elaghmore Partners 
  • Kirby & Haslam was sold to Aston Shaw 
  • learndirect’s eAssessment business went to PSI Services (UK)
  • RxCelerate paid $1.87m for Cambridge Partnership Ltd 
  • Omega Diagnostics was acquired by Lab21 Products for $2.3m plus milestones
  • Innova Systems UK was sold to Visiativ SA 
  • Fistreem International was bought by Scientific Digital Imaging plc for just under $1m
  • TTP Labtech was sold to Battery Ventures
  • Ridgeons was snapped up by Huws Gray
  • Tristel paid $5.6m for Ecomed Services NV.

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