Thoma Bravo leaves without a Darktrace; Euromoney shareholders set to vote on Astorg and Epiris bid

Thoma Bravo will likely make more UK and Europe focused deals, after announcing the opening of a new London office this week.

Good morning Eurohubsters, Craig McGlashan here with the Dealflow.

We’ve seen a lot of US private equity interest in European assets and with the pound and the euro hitting their lowest levels against the dollar in decades, such deals are only going to look more attractive. But one potential blockbuster deal by a US firm for a UK asset has failed to materialise.

No agreement. Thoma Bravo’s interest in UK cybersecurity firm Darktrace has cooled. Cambridge-headquartered Darktrace released a statement this morning saying: “Early-stage discussions took place with Thoma Bravo about a possible offer for the company but an agreement could not be reached on the terms of a firm offer.”

Darktrace had confirmed in mid-August that it was in talks with Thoma Bravo about a possible cash offer for its entire share capital. Thoma Bravo had until 12 September to announce whether it would be making a firm offer. Under UK takeover rules, Thoma Bravo cannot make another bid for Darktrace for six months.

The cybersecurity firm’s share price dropped nearly a third on the London Stock Exchange this morning, to £3.59 ($4.13; €4.13) from just over £5.

When the board of Darktrace confirmed talks were underway in mid-August, the share price jumped from around £4.14 to £5.40.

The Darktrace board said in the statement that it “continues to be very confident in the Company’s future prospects as demonstrated by its FY22 results released today”, including the addition of 1,808 net new customers year-on-year.

While the Darktrace deal might be off, Thoma Bravo will likely make more UK and Europe focused deals, after announcing the opening of a new London office on Tuesday.

Several people in the private equity industry have also told me that US firms are eagerly looking for opportunities in Europe, with the depressed values of the pound and the euro to the dollar making for attractive valuations.

Powering through. Sterling dropped to its lowest level against the dollar since the 1980s yesterday, just as new UK prime minister Liz Truss was settling into 10 Downing Street.

While the economic challenges facing Truss were dominating headlines, her appointment of Jacob Rees-Mogg – who in April said “every last drop” of oil should be extracted from the North Sea – as energy minister was raising more than a few eyebrows in the sustainable energy industry.

But on the private equity side, there is increasing support for renewables, PE Hub Europe’s Nina Lindholm writes. While the race for the leadership of the UK Conservative Party – and thus the country – took place over the summer, we reported on two bioenergy platform launches and multiple deals, underlining the demand for anaerobic digestion assets.

The focus on energy security since Russia’s invasion of Ukraine has also accelerated the push, according to Avent Bezuidenhoudt, director and head of investment at Earth Capital.

“We’ve known for the last couple of years that there was a risk around energy security, but this year shocked everyone,” she said.

You can read Nina’s full roundup here.

Decision time. The take-private bid by Astorg and Epiris for Euromoney Institutional Investor will be the subject of a shareholder vote late this morning that could clear the way for the deal to go through.

Shareholders will vote on whether to agree to the two firms’ offer of £14.61 ($16.89; €16.91) per share for the entire stock of Euromoney, valuing the company at around £1.6 billion.

The Euromoney board unanimously recommended in early September that shareholders vote in favour of the offer by the private equity firms.

Euromoney is a London-headquartered financial publishing and data company (and for full disclosure, my former employer). The firm’s board agreed on the cash offer in mid-July.

If the deal goes through, Euromoney will split, with Luxembourg-headquartered Astorg taking commodity pricing service Fastmarkets and London-headquartered Epiris having majority control of the rest.

Trying to keep up. And finally, reality TV star Kim Kardashian is planning to launch her own private equity firm alongside former Carlyle Group partner Jay Sammons. The firm, called SKKY Partners, will make majority and minority investments in consumer and media companies.

It’s obviously early days for Kardashian in the private equity world, although the big takeaway – at least for someone like me who has not and will never watch Keeping Up with the Kardashians – is that now I’ll need to learn which one Kim is…

That’s it from me – enjoy your day and speak to you on Friday.

Cheers,

Craig