PE Weekly: Tech Acquisitions Start the Year Strong

Investments this week kicked off with acquisition targets across a variety of verticals. Technology appears to remain a strong focus for private equity investors, with two PE giants vying for DocuSign in a headline-grabbing deal. Elsewhere, healthcare and consumer packaged goods saw M&A activity, too. Review the latest deals below.

Platform Investments

MPearlRock Acquires Plant-Based Creamer Company. MPearlRock, an investment platform that focuses on the consumer packaged goods space, has announced its acquisition of plant-based creamer company nutpods. The platform plans to grow the business by expanding its customer base and introducing new product verticals. MPearlRock is a collaboration between alternative asset manager MidOcean Partners, which specializes in middle-market private equity, and PearlRock Partners.

Ardian Enters Negotiations for Minority Acquisition of Inovie. Private investment firm Ardian announced that it has entered into negotiations to acquire a minority stake in France-based medical diagnostic provider Inovie, according to a press release. The transaction would retain Inovie’s position as an independent business, with its biologists retaining a majority stake in the company.

Bain Capital, Hellman & Friedman Vying for DocuSign. A recent report from Reuters says two private equity giants are competing to acquire electronic signature and contract technology company DocuSign in what could be one of the largest leveraged buyouts of the year. Bain Capital and Hellman & Friedman are vying for the company, valued at about $12.5 billion, according to unnamed sources. Reports note that the two firms could partner up to acquire the business.

Phalanx Impact Invests in Middle-Market Lending FinTech. Phalanx Impact Partners, an investment firm focused on environmental and community change, announced this week its investment in financial technology company CollateralEdge. The business targets middle-market companies with credit solutions for banks and financial institutions to strengthen their own offerings to midmarket commercial clients.

Ardian Acquires French Self-Storage Business. Private investment house Ardian announced this week its acquisition of a France-based self-storage business, its first investment in the sector. Ardian acquired Costockage, which offers an online marketplace for storage unit rentals, as well as its self-storage center operating service. The investment was made from Ardian’s Real Estate team, which will expand Costockage’s footprint through building acquisitions.

MidOcean Partners Backs Staffing Company. MidOcean Partners also announced a this week its investment in The Re-Sourcing Group, a professional services firm. The company offers staffing and direct hire solutions for the finance and accounting, legal and compliance, and IT industries. Backing from MidOcean will support the business’s efforts to expand its geographic footprint and introduce new services.

Add-Ons

Allied Industrial’s CES Power Acquires Fourth Generation. U.K.-based Fourth Generation, a power services provider, has been acquired by CES Power, a provider of sustainable mobile power generation and temperature control solutions for large events. CES Power is a portfolio company of Allied Industrial Partners, a private equity firm focused on industrials.

Strategics

Compass Diversified Acquires The Honey Pot. Compass Diversified, a conglomerate made up of middle-market companies, announced its most recent acquisition, that of The Honey Pot Company. The Honey Por offers feminine care products and is valued at $380 million in the deal, according to a press release. Compass Diversified said it expects to close the transaction in February.

Accenture Acquires Imepndi to Strengthen PE Offering. Acenture, a business services company, has acquired sourcing and procurement services provider Impendi, according to recent reports. The investment strengthens Accenture’s offering within the private equity market, offering tailored spend and savings solutions through procurement analytics. The investment also expands Accenture’s global footprint.

Exits

Godspeed Capital Exits Architecture and Engineering Business. Godspeed Capital Management, a lower middle-market private equity firm focused on defense and government services, technology and solutions, announced this week its exit of MOREgroup, a collection of architecture and engineering brands. The platform specializes its focuses on the education, healthcare and federal government sectors, and was launched in 2022. Godspeed sold the company to Wind Point Partners.

Clearlake Exits Janus International. Clearlake Capital Group announced that it has sold its remaining stake of Janus International, a manufacturer and supplier of building solutions and access control systems. The company was acquired in 2018 in partnership with Janus’ founding management team; Clearlake remained its largest shareholder when Janus listed on the NYSE in 2021.

Insights

KPMG Eyes Uptick in Canada M&A. New analysis from KPMG Corporate Finance finds M&A activity in Canada is likely to pick up this year as interest rates decline and economic confidence builds. “One of the big drivers for dealmaking will be private equity funds; a combination of a slower pace of portfolio exits and a slower rate of capital deployment in 2023 in the private equity world will drive activity in 2024,” the firm’s President Neil Blair said in a statement. A survey conducted by KPMG Corporate Finance found 64% of Canadian small- and medium-sized businesses plan to pursue a merger, acquisition or joint venture within the next three years.

Middle Market Growth is produced by the Association for Corporate Growth. To learn more about the organization and how to become a member, visit www.acg.org.