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Morrisons to go to final auction for PE bidders; PE pays out for semiconductors

S&P Global Market Intelligence offers our top picks of global private equity news stories and more published throughout the week.

The battle to take U.K. supermarket chain Wm Morrison Supermarkets PLC private is set to be decided in a one-day auction on October 2 settling a months-long bidding war between Fortress Investment Group (UK) Ltd. and Clayton Dubilier & Rice LLC, the takeover panel has announced.

The auction will consist of a maximum of five rounds with the takeover panel set to announce the result on October 4. The following day, Morrisons is required to make an announcement on its board's views on the revised offers.

The auction will not go ahead if either of the firms makes a "no increase" statement prior to 5pm on October 1.

CD&R, through its $16 billion Clayton Dubilier & Rice Fund XI LP, initially approached Morrisons with a £5.5 billion offer in June, with Fortress making its own £6.3 billion bid in July. Since then, both bidders have continued to increase their offers with neither side declaring their bids final. CD&R has made the highest offer for the supermarket chain thus far, offering £9.7 billion at 285p a share.

Both Fortress and CD&R will be unable to revise their offers or introduce new alternative offers for Morrisons unless a new bidder announces a firm intention to make an offer.

CHART OF THE WEEK: demand for semiconductors

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The surge in demand for consumer electronics as people were stuck at home during the pandemic, coupled with factory closures to help curb COVID-19 outbreaks, has resulted in a shortage of chip supply globally. All of these factors are helping to drive prices up for semiconductor M&A deals, according to Accenture PLC's Syed Alam and Gregg Albert.

Since 2016, 12 out of 213 private equity M&A transactions worth at least $1 billion were in the semiconductor sector as of Sept. 27. Four of these high-valuation deals were struck in 2021, the highest number in any year since 2016.

A total of 17 transactions were terminated over the past five years, and many of these involved target companies based in China and were canceled in 2016, when the trade tension between the U.S. and China intensified.

FUNDRAISING AND DEALS

* Bali Bidco Ltd., a company indirectly owned by Vista Equity Partners Management LLC, will acquire Blue Prism Group PLC in a £1.1 billion deal, and TPG Europe LLP abandoned its takeover plan for the U.K.-based automation software company, according to two separate Dow Jones reports.

* An investor consortium consisting of TPG Capital LP's TPG Global LLC unit, Potentia Capital Pty. Ltd. and Australian superannuation fund Aware Super Pty. Ltd. made a nonbinding all-cash offer to buy Australian salary packaging firm company Smartgroup Corp. Ltd. at an approximately US$1.0 billion valuation, Dow Jones reported.

* EQT AB (publ) made a takeover cash offer of €470 per share for German online pet supplies platform Zooplus AG, higher than the revised €460-per-share buyout bid from Hellman & Friedman LLC.

* Warburg Pincus LLC and the Ontario Teachers' Pension Plan Board are exploring the divestment of oil and gas exploration and production company Chisholm Energy Holdings LLC, which could be worth nearly $1 billion in a sale, people familiar with the matter told Reuters.

ELSEWHERE IN THE INDUSTRY

* InfraVia Capital Partners formed a new 50/50 fiber-to-the-home joint venture with Liberty Global PLC in Germany.

* ChrysCapital is aiming to collect as much as $1.2 billion for its ninth fund that is expected to launch in early 2022, The Economic Times (India) reported, citing people with direct knowledge of the matter.

* Generation Investment Management LLP will acquire up to a 13% stake in Octopus Energy Ltd. for as much as $600 million.

* ESGEN Acquisition Corp., a blank-check company sponsored by an Energy Spectrum Capital affiliate, filed for an IPO of 20.0 million units at $10.00 apiece.

FOCUS ON: APPLICATION SOFTWARE

* Thoma Bravo LP agreed to sell a 45% stake in supply-chain-management software company Command Alkon Inc. to HeidelbergCement AG in a roughly $1.7 billion deal, The Wall Street Journal reported, citing people familiar with the matter. The firm will retain a majority interest in the company.

* Warburg Pincus provided $130 million of new financing to ecmarket Inc., or Conexiom, which offers sales order and invoice automation solutions. Luminate Capital Management Inc. will still hold a majority stake in the business, and Iconiq Growth will remain an investor.

* Francisco Partners Management LP made a strategic growth investment in SourceScrub Inc., joining the company's founders, management and Mainsail Management Co. LLC as stakeholders of the private company intelligence platform.