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Telecom M&A Activity Witnesses Surge: 514 Deals from 2019 to 2023

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News on HR 7 ArdorComm Media Group Telecom M&A Activity Witnesses Surge: 514 Deals from 2019 to 2023

The communications service provider (CSP) sector has seen substantial consolidation over the past few years, with a total of 514 mergers and acquisitions (M&A) involving mobile and wireline companies globally between 2019 and 2023, according to Omdia’s latest research. M&A Deal Volume from 2019-2023 In this period, wireline M&A deals outnumbered mobile deals significantly, with 392 wireline and 122 mobile transactions. A notable mobile M&A deal includes the proposed merger between Vodafone and Three in the UK, which, pending approval by the Competition and Markets Authority, would result in the UK’s second-largest mobile operator by subscriptions. Recent Trends and Market Dynamics The number of M&A deals across all CSP sectors totaled 214 in 2023, a decrease from a peak of 316 in 2021. This decline can be attributed to high interest rates and a cyclical downturn in the technology industry. Despite these challenges, the telecom market’s dynamics indicate a persistent drive for further M&A activities among CSPs. Matthew Reed, Chief Analyst for Service Providers & Markets at Omdia, noted, “With revenues in the telecom sector growing at a low rate while markets are competitive and increasingly mature, many more CSPs will seek consolidation to cut costs by eliminating duplication and invest in network technologies such as fiber and 5G to propel growth in their connectivity business.” Strategic Benefits of M&A Merging provides operators with economies of scale, increased competitiveness against major players, opportunities for cross-selling, and greater procurement power. Beyond consolidation, telecom operators are using M&A to implement delayering and diversification strategies. Delayering and Diversification Strategies Delayering involves CSPs selling infrastructure assets, such as telecom towers, to raise funds for debt reduction or investment in other business areas. For example, in July, Telecom Italia (TIM) sold its fixed-line business in Italy to investment group KKR, enabling TIM to focus on growth through new beyond-connectivity consumer services and enterprise ICT services. CSPs are also acquiring companies in high-growth technology sectors to diversify their offerings. Both Orange and Telefonica have expanded significantly into the cybersecurity sector through strategic acquisitions. Matthew Reed added, “For telecom operators that want to become technology services providers, one way to make that transition is to buy companies that already have the capabilities and customer base in the target sectors.”

Deel Buys Device Management Startup Hofy in a ‘Win-Win’ Acquisition

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News on HR 6 ArdorComm Media Group Deel Buys Device Management Startup Hofy in a ‘Win-Win’ Acquisition

The HR tech sector is currently booming, with investment rounds and mergers and acquisitions (M&A) continuing at a brisk pace. The latest news comes from Deel, which has made its third acquisition this year. Read on to find out more about Deel’s purchase of Hofy and what it means for both companies’ existing HR customers. The HR tech market remains robust and resilient despite challenging macroeconomic conditions. Investments into the sector continued unabated, as do HR tech mergers and acquisitions (M&As). The latest M&A news comes from global HR company Deel – it has acquired Hofy, a London-based device management startup. Hofy enables its 700 customers across the world (including Canva, Veeva, and Fujitsu) to equip their teams with work devices in just one click. Hofy also manages the entire lifecycle of the company device. The Hofy acquisition is Deel’s third acquisition in 2024 – back in the spring, Deel bought German performance management company Zavvy and Africa-based payroll giant PaySpace. The latest news with Hofy is a full circle moment for its Co-Founder and CPO Michael Ginzo – he was an early employee at Deel and left in 2020 to start Hofy. A Bright Future for Deel and Hofy? Founded in 2019, Deel has seen impressive growth over the past five years – it now employs 4,000 people in 100 countries, has raised $630 million, has reached a $12 billion valuation, and has $500 million in annual recurring revenue. Deel helps 35,000 companies look after their teams – standout customers include Nike, BCG, Shopify, and Calvin Klein. UNLEASH was keen to find out why purchasing Hofy was the right next move for Deel and its customers. Speaking exclusively to UNLEASH, Deel’s Co-Founder and CEO Alex Bouaziz shares: “By bringing Hofy’s best-in-class services and device lifecycle management in-house, we hope to simplify global business complexities for our customers with a unified platform that handles everything from device delivery and management to software provisioning and app access. Now we’ll be able to handle this in 120+ countries – it’s going to radically simplify device management and IT support for global teams.” For Bouaziz, Deel’s purchase of Hofy is “another way we’re building a simpler, more consolidated infrastructure for global companies and their teams.” Hofy’s Ginzo also spoke to UNLEASH – he adds: “Hofy and Deel share a vision of simplifying hybrid work – including facilitating remote workforces with a hassle-free onboarding experience. I saw a massive opportunity in the global hiring movement when I was working at Deel on the product team. Hofy has helped meet this demand by delivering and managing devices in 120+ countries around the world. We’ve seen huge growth, and now it’s time to take that to the next level. With Hofy joining Deel, customers will be able to enjoy all the benefits of our device management platform, alongside Deel’s compliance, payroll, HRIS, immigration, and people management products. It’s a win-win, and we couldn’t be happier to combine forces.”  

FTC Requests More Information on $6.4B IBM Planned Acquisition of HashiCorp

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News on HR 5 ArdorComm Media Group FTC Requests More Information on $6.4B IBM Planned Acquisition of HashiCorp

The Federal Trade Commission (FTC) has made a “second request” for additional information around IBM’s (IBM) plan to acquire cloud software company HashiCorp (HCP) for $6.4 billion. HashiCorp said Monday that it received the request last week, and the companies plan to “promptly respond to the Second Request and to continue working cooperatively with the FTC.” IBM and HashiCorp still expect the acquisition to be completed by the end of 2024, according to a filing with the Securities and Exchange Commission (SEC). FTC Assessing Competitive Impacts of Deal The FTC defines a “second request” as part of the deal monitoring process that “typically asks for business documents and data that will inform the agency about the company’s products or services, market conditions where the company does business, and the likely competitive effects of the merger.” HashiCorp did not disclose what information or documents the agency requested, but the review suggests the FTC could have concerns about whether the acquisition would be harmful to competition in the cloud computing space. The deal was originally announced in April, with the sides also stating at the time that it was expected to close by the end of 2024. IBM said in announcing the deal that it was the next step in the company’s “deep focus and investment in hybrid cloud and AI.” Latest in String of FTC Investigative Moves Under the Biden administration, the FTC has stepped up its enforcement efforts, taking a more stringent approach to antitrust policy under Chair Lina Khan. Energy giants Marathon Oil (MRO) and ConocoPhillips (COP) said Friday that they had recently received a second request from the FTC over a deal announced in May that would see ConocoPhillips pay $22.5 billion to acquire Marathon. IBM shares were up less than 1% at $184.35 as of about 11:45 a.m. ET Monday. HashiCorp stock was down less than 1% at $33.44.

Relativity Acquisition Corp Signs Letter of Intent for $500 Million Merger with Mazaii Corp Ltd.

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News on HR 4 ArdorComm Media Group Relativity Acquisition Corp Signs Letter of Intent for $500 Million Merger with Mazaii Corp Ltd.

Relativity Acquisition Corp., a special purpose acquisition company (“Relativity”), announced that it has entered a letter of intent (“LOI”) for a proposed business combination that will result in Relativity acquiring 100% of the outstanding equity and equity equivalents of Mazaii Corp Ltd. (“Mazaii” or the “Company”). The Transaction values the Company at an initial enterprise value of U.S. $500 million. Mazaii Corp Ltd. Mazaii Corp Ltd. is a Montreal-based innovator in the iGaming industry, specializing in the creation and distribution of cutting-edge online casino games and betting solutions. The company supplies its advanced gaming content and technology to prominent brands within the sector, enhancing their platforms and player experiences. Through strategic acquisitions, Mazaii Corp expands its market reach and strengthens its product offerings across key regions, including Europe, North America, Latin America, and Asia. Tarek Tabsh, Chief Executive Officer and Chairman of Relativity Acquisition Corp., commented, “The iGaming industry is experiencing rapid growth, with increasing acceptance and legalization in various regions. Growing consumer demand, driven by the increasing penetration of smartphones and internet access, further fuels this expansion. The Mazaii international platform provides a significant opportunity for scalability and revenue growth. This transaction will enhance Mazaii’s competitive advantage and market positioning.” Eli Baazov, Mazaii’s Chief Executive Officer, stated, “We are thrilled to share the transformative journey of Mazaii in revolutionizing the online gambling arena. We have fortified our position, expanded our market reach, and enhanced our innovative service offerings. With our in-house intellectual property and continuous organic growth, we are confident in our ability to disrupt the gaming landscape and achieve highly favorable results for our shareholders beyond 2024. This is just the beginning of our journey, and we are excited to shape the gaming industry’s future.” The completion of the transaction is contingent upon several factors, including due diligence, negotiation of a definitive agreement, regulatory approvals, and approval by the board and stockholders of both companies. Additional details will be disclosed upon reaching a definitive agreement. The transaction is anticipated to be finalized in the second half of this year, subject to unforeseen circumstances. About Relativity Acquisition Corp. Relativity Acquisition Corp. is a blank check company sponsored by Relativity Acquisition Sponsor LLC, a Delaware limited liability company, formed to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses. About Mazaii Corp Ltd. Mazaii Corp Ltd. is a Montreal-based innovator in the iGaming industry, specializing in the creation and distribution of cutting-edge online casino games and betting solutions. The company supplies its advanced gaming content and technology to prominent brands within the sector, enhancing their platforms and player experiences. Through strategic acquisitions, Mazaii Corp expands its market reach and strengthens its product offerings across key regions, including Europe, North America, Latin America, and Asia. Forward-Looking Statements This press release may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements regarding possible business combinations, financing thereof, and related matters, as well as all other statements other than statements of historical fact included in this press release, are forward-looking statements. These statements are based on management’s beliefs and assumptions and information currently available to them. Actual results could differ materially from those contemplated by the forward-looking statements due to certain factors detailed in the Company’s filings with the Securities and Exchange Commission (“SEC”). The Company undertakes no obligation to update these statements after the date of this release, except as required by law.

India Inc Registers 501 Deals Valued at $21.4 Billion in Q2 2024: Report

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News on HR 3 ArdorComm Media Group India Inc Registers 501 Deals Valued at $21.4 Billion in Q2 2024: Report

India Inc has recorded a total of 501 deals valued at USD 21.4 billion in Q2 2024, according to Grant Thornton Bharat Dealtracker. As per the consultancy firm, Q2 2024 witnessed the highest quarterly volumes in two years, while values declined due to the absence of big-ticket M&A transactions. The merger and acquisition (M&A) and private equity (PE) deals taken together stood at 467, valued at USD 14.9 billion, reflecting a 9 percent increase in volumes but a 28 percent decrease in value, primarily due to the previous quarter’s USD 8.5 billion Reliance-Disney mega-merger, Grant Thornton said. The just-ended quarter featured a one-billion-dollar deal and 30 high-value deals (over USD 100 million), which translates to a 58 percent increase in high-value deals compared to the previous quarter. “Indian corporates are increasingly investing domestically, reflecting strong confidence in the local investment climate,” Grant Thornton said in a release. Despite declining cross-border deals due to geopolitical instability, traditional sectors grew in volumes over the previous quarter. “With recent election results and anticipated policy clarity from the upcoming budget, political stability is expected to boost investor confidence and drive deal activity in the next six months,” it said. Shanthi Vijetha, Partner, Growth at Grant Thornton Bharat, noted that the quarter witnessed robust private equity activity and large domestic deals. “Despite a decline in cross-border deals due to geopolitical uncertainties, domestic investment remained strong. Traditional sectors like pharma and manufacturing also saw strong deal flows, collectively contributing nearly half of the deal values,” Vijetha said. According to Vijetha, the industry anticipates policy continuity, which should positively drive the deal activity.

Employee Associations Urge Merger of RRBs with Sponsor Banks for Enhanced Efficiency

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News on HR 2 ArdorComm Media Group Employee Associations Urge Merger of RRBs with Sponsor Banks for Enhanced Efficiency

Bank employee associations have called on Union Finance Minister Nirmala Sitharaman to merge Regional Rural Banks (RRBs) with their respective sponsor banks. This move aims to ensure overall efficiency and viability in the banking sector. A joint statement from the All India Bank Officers’ Confederation and the All India Bank Employees Association, representing over 6 lakh bank employees, emphasized the need for this merger. “Competition among Public Sector Banks and RRBs is leading to the wastage of scarce financial resources by offering the same types of services,” the statement read. The associations argue that despite this competition, a significant portion of the rural population is not benefiting from modern, technology-driven banking products. RRBs were established under the RRB Act of 1976 with the capital provided by the Government of India, state governments, and sponsored banks. Currently, there are 43 RRBs sponsored by 12 scheduled commercial banks, operating around 22,000 branches, 30 crore deposit accounts, and 3 crore loan accounts across 702 districts. Ninety-two percent of RRB branches are located in rural and semi-urban areas, highlighting their importance in the rural banking ecosystem. The associations believe that merging RRBs with sponsor banks would ensure uniformity in the product range offered to customers, thus accelerating the growth of the rural economy and prioritizing sector lending. “Such integration will update the skills of RRB employees to modern banking practices and effectively address staff shortages in both RRBs and sponsor banks,” they added. Additionally, they noted that the salary structures and benefits of RRB employees are broadly similar to those in sponsor banks, which would facilitate a seamless integration. “The proactive step of merging RRBs with their respective sponsor banks will facilitate enhanced supervision, governance, and accountability, ensuring greater sustainability of the entire banking sector,” the statement concluded.

Saudi Arabia Leads Middle East M&A Activity in Chemicals Sector with $500 Million Deals

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News on HR 3 ArdorComm Media Group Saudi Arabia Leads Middle East M&A Activity in Chemicals Sector with $500 Million Deals

In the first quarter (Q1) of 2024, Saudi Arabia has emerged as the leader in mergers and acquisitions (M&A) in the Middle East’s chemicals sector, according to recent data from financial markets platform Dealogic. The Kingdom recorded $500 million worth of deals in the chemicals sector, highlighting its significant role in the region’s M&A landscape. Dealogic’s figures revealed that Saudi Arabia’s total M&A deal volume for Q1 2024 reached $955 million, with the chemicals sector accounting for a substantial 52.4 percent of this total. Notably, Saudi Arabia was the only country in the Middle East to exhibit activity in the chemicals sector during this period. A report from management consulting firm Kearney earlier this month indicated that chemical industry executives expect increased M&A activity, particularly driven by strategic investors such as national oil companies. “Recent deals by major players like Aramco and ADNOC underscore the region’s commitment to leveraging M&A as a key growth lever, setting the stage for a dynamic and transformative period ahead,” stated Jose Alberich, partner for the Middle East and Africa at Kearney. Beyond the chemicals sector, Dealogic’s data highlighted other targeted sectors in Saudi Arabia. The professional services sector was the second most targeted, with deals worth $160 million, accounting for 16.8 percent of the Kingdom’s total M&A volume. The technology sector followed closely with $138 million in deal value, capturing a 14.5 percent share. Additionally, the retail and insurance sectors represented 7 percent and 4.1 percent of the total, respectively. The broader Middle East M&A landscape saw a targeted deal volume of $6.21 billion in the first three months of the year. The technology sector led with 42 deals worth $1.56 billion, underscoring its growing prominence in the region. However, on a global scale, M&A activity experienced a significant decline during the same period. The number of transactions fell by 31 percent to 7,162, marking one of the quietest quarters for dealmakers in nearly two decades. This global slowdown was largely attributed to high capital costs, with Switzerland being the only major economy to cut interest rates in 2024.

Vapotherm Enters Into Definitive Merger Agreement; Transaction Would Result in Company Going Private

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News on HR 1 2 ArdorComm Media Group Vapotherm Enters Into Definitive Merger Agreement; Transaction Would Result in Company Going Private

Vapotherm, Inc. (OTCQX: VAPO) announced today that it has signed a definitive merger agreement with a newly-formed entity funded by an affiliate of Perceptive Advisors, LLC, a leading healthcare investment firm. This transaction will result in Vapotherm becoming a private company. Details of the Merger Agreement: Debt Conversion and New Investment: SLR Capital Partners will convert approximately $81 million of term debt into preferred equity in the new entity. Perceptive will invest $50 million of new preferred equity, a portion of which will fund the merger and related payments. SLR will retain $40 million of term debt. Merger Consideration: Vapotherm’s stockholders will receive $2.18 in cash per share, representing a 166% premium over the stock’s closing price on June 14, 2024. Board Approval: A special committee of Vapotherm’s Board, composed solely of independent directors, recommended the approval of the merger, which the Board accepted. Statements from Key Stakeholders: Anthony Storino, SLR Capital Partners: “This transaction allows the Company to strengthen their balance sheet as they focus on accelerating their revenue momentum.” Konstantin Poukalov, Perceptive Advisors: “We believe the Company has a clear vision to expand the use of high-velocity therapy in patients in need and look forward to supporting them in their next stages of growth.” Expected Closing and Future Operations: The transaction is anticipated to close in the second half of 2024, pending customary conditions, including stockholder approval. Upon completion, Vapotherm will be privately held and will no longer be publicly listed or traded on OTCQX. Advisors and Legal Counsel: Cooley LLP is representing Perceptive, Latham & Watkins LLP is representing SLR, Scalar, LLC is acting as the financial advisor to the Special Committee, and Ropes & Gray LLP is representing Vapotherm. About Vapotherm: Vapotherm, Inc. is a publicly traded developer and manufacturer of advanced respiratory technology, based in Exeter, New Hampshire. Their high velocity therapy systems provide non-invasive respiratory support, having treated over 4.4 million patients. The company focuses on delivering technology to patients in respiratory distress, offering a mask-free interface that allows patients to talk, eat, and drink while receiving treatment. Additional Information: This announcement is deemed solicitation material related to the proposed transaction. Vapotherm plans to file a proxy statement with the SEC and urges stockholders to read it in its entirety for important information about the transaction. Documents will be available on the SEC’s website and Vapotherm’s investor relations page. Forward-Looking Statements: The announcement includes forward-looking statements regarding the proposed transaction, stockholder approval, and the anticipated closing timeline. These statements are subject to risks and uncertainties that could cause actual results to differ. Vapotherm does not assume any obligation to update these statements, except as required by law.

Cognizant to Pay $1.3 Billion in Belcan Acquisition

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News on HR 2 ArdorComm Media Group Cognizant to Pay $1.3 Billion in Belcan Acquisition

The engineering resources and development company will slot in as a Cognizant operating unit. IT consultancy and reseller Cognizant signaled its high priority for engineering services by announcing its intent to acquire Belcan. New Jersey-based Cognizant is buying Belcan from private equity investor AE Industrial Partners for about $1.3 billion in stock and cash. The deal, which reportedly would add $800 million in annualized revenue, would close in the third quarter of 2024. Belcan will keep its name and function as a Cognizant operating unit. Both companies say the engineering resource and development (ER&D) market is hot right now. Cognizant, in its announcement, estimated the ER&D services market at $190 billion currently, with a compounded annual growth rate (CAGR) of 10%. Cognizant, in a news release, said adding Belcan will improve its existing Internet of Things (IoT) and digital engineering practices. But perhaps more importantly, Cognizant is expanding its vertical expertise into aerospace and defense and adding Belcan’s “blue-chip client base.” Cognizant, on the other hand, can offer IT solutions around AI, cloud, and data to Belcan’s customers, Cognizant CEO Ravi Kumar said. Google Cloud recently recognized Cognizant for its work in data analytics, and Microsoft recognized it for intelligent automation. “We see the opportunity to immediately accelerate revenue growth and create compelling shareholder value through our combined engineering capabilities,” Kumar said. “Belcan’s clients would gain access to Cognizant’s full suite of technology services, while Cognizant’s clients across the manufacturing, automotive, energy, and high-tech sectors we believe will benefit from Belcan’s engineering skills.” The combined company would employ more than 6,500 engineers and technical consultants, Cognizant said. Cognizant, in late 2023, bought ServiceNow partner Thirdera. Belcan Acquisition History Cincinnati, Ohio-based Belcan launched in 1958 and won key contracts over the years with Procter & Gamble and General Electric. Aerospace and industrial vertical-focused AE bought Belcan in 2015 for an undisclosed sum. The PE firm went on to tuck in 17 acquisitions into Belcan, including software engineering company Avista and workforce management solutions provider RTM Consulting. Belcan CEO Lance Kwasniewski will continue to lead Belcan as a Cognizant operating unit. “We are excited about this unique combination and the value creation it will bring to our customers, along with the opportunities it will provide for our employees. Cognizant will better position our team to capitalize on compelling tailwinds, including increasing outsourced ER&D spend, the transformative impact of digital engineering adoption rates, robust commercial aerospace demand, and favorable long-term defense and space spending,” Kwasniewski said. “Belcan’s experienced team has built a growth-oriented business delivering highly complex, mission-critical, scalable services to our long-standing customer base. I look forward to continuing to lead our team as we unite and leverage Belcan’s and Cognizant’s comprehensive services and cross-industry clientele to execute on our collective strategy, ultimately earning the role of our clients’ most trusted partner in intelligent engineering.” Cognizant drove $19.4 billion in fiscal year 2023 revenue.