clairfield international in china - pca

CLAIRFIELD REVIEW
Q 3/4 2014
CLAIRFIELD INTERNATIONAL IN CHINA
Clairfield takes center stage at China International Fair for Investment and Trade
Xiamen skyline from Gulang-Yu Island. Xiamen is host to CIFIT, the world’s largest investment fair.
Clairfield China, together with its international partners from across
Europe and Australia, took a starring role at the China International
Fair for Investment and Trade (CIFIT), China’s largest investment fair.
The fair took place in Xiamen on September 8th-10th and during
those three days Clairfield was the protagonist of several events.
Clairfield events included an M&A forum, participation in country
panels, investor matchmaking, a seminar, and a reception, in addition to a permanent booth. With over 60,000 attendees including corporations, government representatives, and investors, and a
theme of “going global”, CIFIT was the ideal launching pad for Clairfield partners to connect with cash-rich Chinese companies that are
interested in investing in Europe and elsewhere.
The forum closed with a seminar and reception where Chinese
guests mingled with Clairfield partners and were able to exchange
ideas informally. Yufang Guo, managing director of Clairfield China
and longtime specialist in connecting China to Europe, was the principal organizer of the event. “I was very pleased to introduce Chinese companies in need of guidance to my international partners
who are capable of getting complex deals done,” says Mr. Guo.
After the conference in Xiamen, the Clairfield delegation went
on the road to Shanghai for meetings with business and government leaders. Clairfield hosted a symposium with high-ranking
e­xecutives of funds, industrial corporations, and investment banks.
Clairfield’s M&A forum, with over 60 participants, opened with
speeches on transforming China through M&A given by local heads
of government and the OECD (Organization for Economic Cooperation and Development). Brian O’Hare, chairman of Clairfield International, then gave a speech on the value of M&A for Chinese
companies investing across the globe. Mr. O’Hare stated that M&A
is the next step in China’s economic development and can be the
most effective way to acquire access to new technologies and markets.
The forum then moved to a roundtable discussion with presentations by Clairfield’s regional partners from Germany, the UK,
France, Spain, Italy, and Australia, followed by a lively discussion of
M&A success stories.
Clairfield chairman Brian O’Hare addresses the M&A forum.
1
SPOTLIGHT ON CHINA
CLAIRFIELD AT CIFIT (CONTINUED FROM PAGE 1)
The Clairfield delegation visited Shanghai’s
Chamber of International Commerce and
met with several of its member companies.
Clairfield also visited Great Wall Asset Management, one of the largest state-owned financial institutions in China. Clairfield was
recently selected as en exclusive partner of
Great Wall to promote Chinese outbound
investment and M&A.
Clairfield global partners at the M&A roundtable.
Mr. Guo believes that China is at a watershed moment. “At this moment in history,
China’s economy is becoming globalized
while the global economy is becoming focused on China,” says Mr. Guo. “The current strategic task of Chinese companies
is to acquire essential technologies and
internationalize their brand names as well
as lift their management to a world level
through M&A.”
International governmental groups took
advantage of the CIFIT conference to market opportunities in their countries. German partner Dirk Freiland was invited to
speak at the 7th China-Germany Economic
Cooperation Forum, sponsored by Germany Trade & Invest. “From Germany we
see clear synergies with what the Chinese
need in terms of technical know-how and
an affluent market, and what Germany can
offer. The automotive market is one clear
example,” says Mr. Freiland. “Germany
is the top European location for Chinese
companies.”
2
In the past, developing nations have been
extremely proactive in courting investment
from China and China has been receptive,
becoming a large investor in Africa’s natural resources, for example. Recent years
have seen the circle of interest becoming
larger globally.
“There was a very high level of interest in
engaging with countries outside of China,
which the Chinese call going out,” observes Brett Plant of Clairfield Australia.
“China has USD 4 trillion in reserves – 70%
of which is in US bonds – they want to do
something different with these reserves.
The going out strategy appears to be well
supported and encouraged at a political
level. The caveat is that the Chinese groups
need help with clarifying their specific
M&A strategy and the investments they
want to make.”
Gary Ecob of Clairfield UK concurs. “The
Chinese mid-market is inexperienced
­co­mpared to the rest of the world in how
to do crossborder M&A and the buy side
culture has a hazy M&A strategy. Many
companies have the cash and desire to
acquire overseas, but they need a helping
hand in deciding exactly what the goal is,”
he says. “The effort is obviously worth it
as last summer’s acquisition of Covpress
by Shandong Yongtai and TIA Treadsetters
shows.” That transaction was the most notable investment by China in the UK Midlands automotive manufacturing in a decade. The real value only became apparent
this summer when Covpress announced
plans to build a GBP 200 million, 500,000
square foot plant in Shandong province,
creating 5,000 jobs.
Mr. Ecob is enthusiastic about the many
opportunities he saw in Xiamen and Shanghai. “With the Chinese mandate for growth
and Clairfield China’s motivated and
­talented team providing crucial assistance
with language, legal, and cultural issues,
we can break down the barriers to doing
deals in China.”
Yufang Guo, fifth from left, and Clairfield International partners pose in front of the Clairfield booth at the CIFIT fair.
SELECTED RECENT TRANSACTIONS
Client
Transaction overview
Counterparty
South African food service giant Bidvest Group Limited acquired a majority stake of DAC Group S.p.A. for EUR 130 million. The
acquisition creates a hub to deliver worldwide Made in Italy products through Bidvest companies. The Bidvest Group Limited is a
company listed on the Johannesburg Stock Exchange (BVT:SJ), with a current market capitalization of EUR 6 billion and revenues
of EUR 11 billion. It is one of the largest services companies in South Africa, operating over five continents and employing over
137,000 people worldwide. Clairfield Italy acted as financial advisor to Bidvest.
Clairfield International in Finland served as exclusive financial advisor to Governia in the sale of Easy Km to ALD Automotive
Finland. Easy Km is Finland’s largest commercial vehicle leasing company offering a diverse range of leasing solutions. Easy Km’s
2013 revenues were EUR 88 million operating a fleet of around 8,000 vehicles. ALD Automotive Finland, the operational leasing and fleet management business line of the Societe Generale group, is one of the largest leasing providers in Europe and a
company of reference in its market.
H2 Equity Partners acquired Ballast Phoenix Limited, the UK’s leading incinerator bottom ash recycling group, from Ballast
Nedam NV, the Dutch-listed construction group. Ballast Phoenix employs 82 people and has seen significant sales growth in recent years. The company processes and recycles the ash produced by energy-from-waste plants and creates sustainable IBA (incinerator bottom ash) aggregates. Ballast Phoenix operates 7 IBA recycling sites throughout the UK and works in close conjunction with operators of energy-from-waste plants as well as its aggregate and metal customers. Advised by Clairfield Netherlands.
Clairfield International in the US advised the sale of Internet Broadcasting to Nexstar Broadcasting Group, Inc. (NASDAQ:
NXST). Internet Broadcasting is a leader in technology and services for the broadcast media industry, offering a full suite of digital
solutions including a SaaS-based digital publishing platform, original and syndicated content, and digital advertising agency services. Nexstar Broadcasting Group is a diversified media company that owns, operates, programs or provides sales and other services to 74 television stations and 13 related digital multicast signals reaching approximately 12% of all US. television households.
Hawe Telekom, a subsidiary of the public company Hawe, merged with Mediatel Group. Hawe Telekom Ltd. renders carrier
services with its countrywide fiber optic backbone network. The company provides services to Polish and international telecommunications operators. Mediatel is a listed company which offers wholesale voice, data center and co-location services. Clairfield
Poland assisted Hawe in negotiations with minority shareholders of Mediatel and elaborating a price offer that was acceptable
to the stock market.
IMPACK
​​
The
investment group Impack, consisting of the PE fund Sofimac Partners and new CEO Cyril Sabatier, acquired printed packaging company OTICR. Created in 1970, OTICR was initially specialized in the printing industry. Over the years, the company moved
into the manufacturing of printed board packaging. Its clients come from a broad range of businesses, including household
products, the food-processing industry, the paper industry, and leisure products. Headquartered in France, OTICR has a turnover
of more than EUR 6 million, and employs about 50 people. The acquisition was advised by Clairfield France.
Otera Elektro was sold by Otera Group to Bravida, Scandinavia’s leading supplier of technical installation and service solutions.
The Bravida Group thereby continues its expansion in the Norwegian market. Otera Elektro AS has approximately 340 employees
and a turnover of about NOK 500 million in 2013. It is one of the largest pure play electrical installation and service companies
in the Norwegian market. The company performs electrical installations, as well as providing automation and instrumentation
solutions to construction projects, industry, and the oil and maritime sector. The sale was advised by Clairfield Norway.
East Coast Traffic Control was acquired by TeamInvest Private. East Coast specializes in providing civil construction companies
and government departments with traffic control services, labor hire, and equipment. The company is the dominant provider
of traffic control services in northern and central Queensland. Teaminvest Private is the private equity arm of Teaminvest, an
investment firm whose members own or control approximately AUD 1 billion in invested funds. Clairfield Australia managed the
exit on behalf of the shareholders.
​ lairfield International in Italy and Germany advised the Italian IMR Automotive S.p.A. in the acquisition of the German FPK
C
Lightweight Technologies Deutschland GmbH. IMR is a world-class supplier in the manufacturing of exterior parts for the automotive and truck industry. IMR offers Tier 1 services and products to the most prestigious car manufacturers in the world,
employing approximately 1,300 workers in five different plants. The acquired business is a company active in the design and
manufacture of composite lightweight structures and aerodynamic components for the automotive sector.
Clairfield International in Italy advised the owners of DEI Srl in the sale of 100% of their shares to ELFI spa. DEI srl is active in the
wholesale distribution of electric materials for civil and industrial use, with 2013 sales of approximately EUR 24 million. Elfi spa
is a company located in the Romagna area, with 12 subsidiaries. Sales in 2013 were about EUR 70 million. Thanks to the transaction, which has an enterprise value in the range of EUR 20 million, Elfi will reach EUR 100 million in annual revenues, becoming
one of the most important players in the wholesale distribution of electric materials in Italy.
LeanApps, a supplier of SaaS (software-as-a-service) software for life and pension insurers was sold to Keylane, a portfolio company of Waterland Private Equity Investments. LeanApps, a market leader in the Netherlands with its SaaS platform, is the third
company in Keylane, together with Actuera and Quinity. As part of Keylane, LeanApps will be able to achieve its international ambitions more quickly. The company was sold by the founders and Newion Investments, a Netherlands-based venture capital firm.
Clairfield in the Netherlands advised LeanApps.
CRM Insight, a leading Norwegian consulting company in CRM solutions, was acquired by Økonomibistand Group, a fastgrowing Visma ERP software partner focusing on accounting, logistics systems, CRM, and payroll. CRM Insight implements
large and medium-sized CRM projects based on the industry’s leading tools. CRM Insight was divested by private-equity
backed Crayon Group, one of the leading volume license partners for a range of software manufacturers. Clairfield Norway
advised CRM Insight.
FortConsult, a leading Nordic security testing service provider was sold to the publicly-listed British NCC Group. FortConsult
is one of the leading Nordic security testing service providers, based in Denmark. The client base includes many of the large
Nordic and selected European financial institutions, providers of payment systems, and software to the industry. The acquisition of FortConsult increases NCC Group’s presence in mainland Europe which will further enable the Group to provide its
customers with one-stop testing services across Europe. Clairfield Denmark advised FortConsult.
3
CLAIRFIELD
REVIEW
THIRD
QUARTER
2011
Q 3/4 2014
NEWSPAPER
IMPACT INVESTING IN AUSTRALIA
Clairfield Australia has announced a partnership with socially-­
focused financier and fund manager Foresters Community Finance, aimed at enhancing the management and development of
an innovative range of impact investment products for the Australian market.
Impact investments are defined by the Global Impact Investing
Network as “investments made into companies, organizations,
and funds with the intention to generate measurable social and
environmental impact alongside a financial return.”
Australia, like many jurisdictions around the world, has witnessed
increasing interest and activity in impact investment over recent
years as businesses, governments and communities seek new solutions to enable an inclusive and sustainable society.
On the global stage, impact investment took a major step forward
when the Social Impact Investment Forum was convened by the
G8 in June 2013. Subsequently, a Social Impact Investment Taskforce was established by these governments to foster the impact
investment market. In addition to members from the G8, the taskforce includes an observer representative from Australia. “This
Taskforce is becoming the international vanguard of the revolution…more than 200 able figures are engaged across the G8, Australia and the EU, focused on establishing impact investment as a
powerful force in each country,” said Sir Ronald Cohen, chair of
the taskforce.
Philanthropists, foundations and charities as well as institutional
investors have implemented impact investment strategies. These
strategies aim to yield financial returns, as well as positive and
measurable social and environmental impacts. While some investors pursue commercial financial returns, others consciously elect
to accept reduced financial returns in the interests of pursuing
greater impact.
Analysis of the Australian market suggested annual impact investments of AUD 300 million and total capital managed of AUD 2 billion in 2012, with projecting growth to around AUD 32 billion over
10 years. These numbers assume market development in Australia will mirror the progress of similar investments in the United
Kingdom and United States, and that Australia will enjoy the same
growth rates as have been forecast for those markets.
“We see our investment in Foresters’ funds management subsidiary, Social Investments Australia, as being in keeping with our
own mission and vision - creating wealth for our clients and giving
something back to the community in which we live and do business,” says Paul Keehan, executive chairman of Clairfield Australia
and new chair of Foresters.
DISCLAIMER: No part of this report may be reproduced without the written permission of Clairfield International or one of its partner firms. The information herein
has been obtained from sources that we believe to be reliable, but we do not guarantee its accuracy or completeness. While we endeavour to update on a reasonable basis the information presented in this report, there may be regulatory, compliance or other reasons that prevent us from doing so. Much of the information
contained in this report is subject to variation due to changes in market conditions, legislation or regulatory matters and Clairfield International does not undertake
to notify any recipient of the report of changes to the information contained herein. This report is not to be construed as an offer to sell or the solicitation of an
offer to buy any security in any jurisdiction. Additional supporting information is available upon request. Please contact: Research Desk, Clairfield International, Tel:
+41 22 518 0242, email: press@clairfield.com.
4