Finance M&A busy as EQT closes BPEA deal and AXA looks to buy Spanish insurer

Good morning Eurohubsters, Craig McGlashan here with Tuesday’s Dealflow.

We’ve been speaking to dealmakers a lot about which sectors are likely to prove resilient during the economic downturns expected in many European countries. Three sectors that have popped up a lot are finance, healthcare and entertainment – and today we have a nice selection across those groups.

Closing the deal. Yesterday we talked a lot about finance M&A, including my interview with Jerry del Missier of Copper Street Capital about his firm’s recent exit from Satispay and CACEIS, the asset servicing banking group of Crédit Agricole and Santander, signing a memorandum of understanding with Royal Bank of Canada to buy the European asset servicing activities of RBC Investor Services.

Well, we have a bit more to report on the finance front.

EQT today completed its merger with Baring Private Equity Asia to create BPEA EQT.

The deal was first announced in March and had a total consideration of €6.8 billion, comprising 191.2 million new ordinary EQT shares, valued at the time at €5.3 billion, and €1.5 billion in cash. In Tuesday’s announcement, the cash amount was given as €1.6 billion.

BPEA had €22.1 billion in fee-generating assets under management as of 30 September. EQT has acquired 100 percent of the BPEA management company.

“Asia is home to more than half of the world’s population and predicted to generate over 40 percent of global GDP within 10 years – as a result, it’s expected that the growth of the Asian private market will accelerate at nearly double the pace of global markets through 2025,” said Christian Sinding, CEO and managing partner of EQT, in a statement.

EQT is headquartered in Stockholm and BPEA is headquartered in Hong Kong.

Exclusive negotiations. AXA announced that AXA Spain is in exclusive negotiations with Groupe des Assurances du Crédit Mutuel to potentially buy its subsidiary Groupe Assurances du Crédit Mutuel España, a Spanish health insurer.

The parties are discussing terms of a cash consideration of €310 million, a price-to-own funds multiple of 1.0x. The estimated price-to-earnings multiple is 9.0x.

“This transaction reflects our disciplined approach towards M&A in line with our strategy, enhancing our scale in one of our core European markets, with a focus on technical lines”, said Frédéric de Courtois, deputy chief executive officer of AXA, in a statement.

Closing the deal – again. Deutsche Bank has completed the sale of its financial advisors business in Italy to Zurich. The agreement for the deal was signed back in August 2021 and will involve over €15 billion in assets under management passing to Zurich.

In that vein. Palatine announced that it had sold its stake in Veincentre to CBPE Capital.

Veincentre is the UK’s largest chain of varicose vein treatment clinics, according to Palatine. The sale is the second from Palatine’s Impact Fund following its exit from Estio Training in November 2021.

Following Palatine’s investment in Veincentre in July 2019, the company expanded its footprint of clinics from seven to 22 across the UK. The Stoke-on-Trent-headquartered company had an increase in enquiries by 270 percent and an increase in revenue of over 180 percent over the course of the investment.

Palatine is a Manchester-headquartered private equity and venture capital firm. It has two funds, Buyout and Impact, and was founded in 2005.

The buyer, CBPE, invests in UK mid-market businesses with an enterprise value of up to £150 million. It was founded in 1984 and is headquartered in London.

You can read the full coverage of the deal here.

Entertain me. Several dealmakers I’ve spoken to over the last few weeks have told me they are bullish on the prospects for entertainment assets. Despite the rising cost of living, people need to be entertained, they told me.

There is certainly a bit of activity on the M&A side of things in that sector. After we wrote yesterday about UK television network ITV mulling the sale of its production arm ITV Studios, today we can report that Banijay UK has bought Mam Tor Productions.

Mam Tor’s most recent production was Chloe, six-part drama screened on BBC One earlier this year and later bought by Amazon Prime Video.

Mam Tor is based in London.

Banijay UK is part of the Paris-based Banijay Group.

Inter into a deal. From a drama producer to the drama of Italian football, one of the country’s largest clubs is looking for a buyer, according to the Financial Times.

Inter Milan’s owner, Nanjing, China-based electronics seller Suning, has hired Raine Group and Goldman Sachs to work on a sale, according to people familiar with the matter spoken to by the FT.

Private equity firms could well be among the potential buyers. Inter’s city rivals AC Milan were bought by RedBird Capital Partners in late August, while there has been a wave of private equity money coming into European football from other firms, often based in the US.

You can read my round-up of some of those deals here.

That’s it from me – I’ll be back with you tomorrow.

Cheers,

Craig