UPDATE: Anglo American to meet competition conditions on JV with Lafarge

London-based miner Anglo American Plc (LON:AAL) welcomed on Tuesday the ruling of UK’s competition regulator on its planned joint venture with French cement producer Lafarge (EPA:LG) and expressed confidence that they would be able to meet the conditions attached to the approval.

The Competition Commission (CC) unveiled earlier today its final report on the investigation into the British JV planned by Anglo and Lafarge, asking the two partners to sell a substantial operations portfolio in order to win its approval.

In response, Anglo said it would work closely with the regulators towards a positive outcome and the conclusion of the JV deal as soon as possible.

Lafarge also reacted by saying that despite the required disposals, the proposed business combination would generate recurring synergies through enhanced operational efficiencies, improved logistics and value-added products.

The 50/50 venture, agreed last year, would merge Anglo American’s Tarmac UK with Lafarge’s construction materials operations in the UK into a business with combined sales of GBP1.8bn (USD2.9bn/EUR2.2bn) and EBITDA of GBP210m in 2010, the two companies have said.

The regulator, which expressed concerns in February that the JV would hurt competition in certain segments of the building materials market, said today it was still standing by that ruling. Before the JV deal can move ahead, Anglo and Lafarge have to sell operations including cement plants, rail depots, RMX plants and aggregate quarries, in order to protect consumers interest in key segments, especially since a lot of construction work is publicly funded, the CC said.

See also: UK Competition authorities demand disposals to OK Anglo American, Lafarge JV


Deloitte’s advisory US advisory arm acquires restructuring specialist CRG Partners

US Deloitte Financial Advisory Services LLP, a unit of accounting firm Deloitte LLP, on Monday announced it had taken over New York-based operational and financial restructuring services provider CRG Partners.

The company has acquired all of CRG’s assets so that it may improve its financial restructuring, turnaround management and bankruptcy reorganisation capabilities, it said, without disclosing the value of the transaction.

According to Deloitte Financial’s chief executive officer, David Williams, there are still firms that experience significant operational and financial issues even though the economy is improving.

The reorganisation services group of Deloitte will now immediately tie up with CRG and begin operating under the name Deloitte Corporate Restructuring Group, or Deloitte CRG. The practice will be co-led by William Snyder and Sheila Smith. The buyer also said that 18 professionals from CRG have become Deloitte principals or directors.

The acquisition unveils a significant growth opportunity for Deloitte, Smith commented. In turn, Snyder said that the combination of the two entities will allow them to establish a world-class restructuring practice.

Terra Firma close to sealing a £825m deal to acquire Four Seasons Health Care

UPDATE: Terra Firma confirms media reports and reveals GBP825m deal to acquire Four Seasons Health Care Ltd. Previous version follows:

UK private equity firm Terra Firma Capital Partners Ltd is nearing an agreement for the acquisition of Four Seasons Health Care Ltd, the biggest UK care homes operator, according to a report in the Financial Times.

The transaction would give Four Seasons an enterprise value of GBP825m (USD1.3bn/EUR1bn) and the parties could announce an agreement this week, the newspaper said.

Four Seasons is faced with a September deadline to refinance net debts of GBP780m. The company confirmed earlier in April that it was holding talks with investors as part of its efforts to strike a refinancing deal.

According to a source familiar with the matter, Terra Firma will supply some GBP300m in equity and Four Seasons is likely to raise new debt of around GBP25m.

The care homes operator narrowly escaped a forced sale in 2009 as it struggled with a heavy debt burden. However, it managed to agree a debt-for-equity swap with its lenders, which put Royal Bank of Scotland Group plc (LON:RBS) in control of the business, the FT went on to add. The deal reduced Four Seasons’ GBP1.6bn debt by half. In 2010, the company negotiated a two-year extension to the maturity date.

Four Seasons, which has appointed Rothschild and Gleacher Shacklock as advisers, wants to strike a deal with investors and creditors in May and finalise it by July.

For Terra Firma, it would be the second UK acquisition involving a company taken over by its lenders through the exchange of debt for equity. In March, the private equity group sealed a GBP276m deal for The Garden Centre Group.

UK private equity firm Permira in talks to acquire Nokia’s luxury handset brand Vertu

Finnish mobile phone maker Nokia Oyj (NYSE:NOK) has reached the advanced stage of negotiations over the sale of its luxury handset subsidiary Vertu to UK-based private equity firm Permira, as the company looks to shed non-core assets in a bid to revive its devices unit.

The Financial Times reported that the disposal is expected to generate around EUR200m (USD265m) for Nokia, which was once considered the undisputed leader on the mobile phone market, but is now struggling to make inroads into the smartphone business. Efforts also include accelerating cost reductions at the division, the newspaper said.

For Permira, a successful outcome of the talks would mean another luxury brand in its portfolio, which includes fashion labels Hugo Boss and Valentino. According to the sources, there is no certainty yet that the parties would reach an agreement. Nokia has enlisted the advisory services of Goldman Sachs (NYSE:GS). None of the companies mentioned agreed to comment to the FT.

Swedish-based private equity group EQT Partners has also held talks with Nokia over acquiring Vertu but sources familiar with the matter report that there is currently no development on that front. The FT said that some luxury goods companies had also indicated interest in buying the brand.

Vertu was set up by Nokia in 1998 and has become known as the maker of the most expensive handsets in the world. The UK-based business makes devices whose price sometimes exceeds GBP200,000. The hand-made phones with precious metal components are sold in over 60 countries. Vertu’s annual revenues are estimated at between EUR200m and EUR300m, the FT added.

London-listed Globaltrans to acquire Russian rival Metalloinvesttrans for $540m

Russian freight rail company Globaltrans Investment Plc (LON:GLTR) on Friday said it would take over Metalloinvesttrans LLC (MIT), the captive freight rail transportation operator of Russian iron ore producer Metalloinvest, in a cash- and debt-free deal worth USD540m (EUR410m).

With this addition, Globaltrans will boost its fleet to around 60,000 rail cars by mid-2012 and enhance its position as a top private freight rail operator in Russia, the buyer said, adding it would use own funds and secured debt to finance the transaction.

Increased scale and resources will help maximise efficiency and profitability, Globaltrans’ CEO Sergey Maltsev said.

MIT is a high-quality firm, which together with the service contract with Metalloinvest, offers Globaltrans a low-risk opportunity to grow and strengthen its market position, the CEO added.

Under the agreement, Globaltrans and Metalloinvest have sealed a three-year service contract for Globaltrans to handle 100% of Metalloinvest’s rail transportation cargo volumes in the first year of the contract for an agreed price and 60% in the other two years.

MIT, which operated 9,202 railcars as at 31 December 2011, manages rail logistics of Metalloinvest cargo volumes.

Metalloinvest will free up capital through the divestment, its CEO, Eduard Potapov, said. The group’s subsidiaries will also be provided with solutions that would allow them to use Globaltrans’ railcar fleet, he added.

Globaltrans, which will buy MIT through its fully-owned unit OJSC New Forwarding Company, expects to wrap up the deal by the end of May, pending regulatory clearance.

France’s Dassault agrees to acquire Canadian Gemcom Software

French software and consulting services group Dassault Systemes SA (EPA:DSY) has revealed it will take over Canadian mining industry software provider Gemcom Software International Inc in a cash deal worth around USD360m (EUR272.3m).

Bernard Charles, Dassault Systemes’ president and CEO, said the combination of Gemcom with the group’s 3D Experience platform would help its goal to model and simulate the planet with the aim of improving predictability, efficiency, safety and sustainability within the natural resources sector.
As a step towards that ambition, Dassault Systemes has created the new GEOVIA brand, the CEO added.

In turn, Gemcom expects the combination to enable it to offer global support to its customers and address global issues for them as a real partner, said its president and CEO, Rick Moignard, who will head the new GEOVIA organisation as CEO after the deal.

The transaction will also boost the buyer’s geographic presence in Australia, Africa, Canada, South America, Kazakhstan, Mongolia, Indonesia and Russia, it said.

Gemcom’s 360 staff and management will remain in place, with its managers to further develop Dassault Systemes’ strategy of modeling the natural world.

Completion, subject to regulatory clearance, among other conditions, is expected in July 2012.

Gemcom is currently owned by JMI Equity Fund VI LP, The Carlyle Group LP and Pala Investments Holdings Limited. Its solutions are used in 5,500 operating mines and around 15,000 mining projects by all major miners in the world.

Food group Nestle in $11.85bn deal to acquire Pfizer’s infant nutrition unit

Swiss food group Nestle SA (VTX:NESN) is taking over the infant nutrition business of US pharmaceutical giant Pfizer Inc (NYSE:PFE) in a USD11.85bn (EUR8.9bn) deal, the two companies said on Monday.

Nestle’s chief executive, Paul Bulcke, said infant nutrition has always been core to the group’s business and with this addition it would widen its portfolio and expand its position in the global sector.

The business to be bought makes 85% of its sales in emerging markets, complementing perfectly Nestle’s own baby nutrition operations while serving its growth-focused strategy, the buyer said.

For Pfizer, which has been reviewing alternatives for the nutrition business, the divestment is in line with its goal to generate shareholders value, chairman and CEO Ian Read said, adding the group would use the funds to buy back shares or invest in other business development projects.

Pfizer Nutrition, whose revenues increased by annual 15% to USD2.1bn in 2011, has sales, product development, manufacturing and business centres in the US, Latin America, Europe, the Middle East, Africa and Asia.

Its portfolio includes everyday and speciality infant and toddler formulas, follow-on formulas, as well as maternal and adult nutrition products. Its employees in 60 countries will be taken on by Nestle pending consultations with work councils and unions.

Completion, subject to conditions including regulatory approvals, is expected in the first half of 2013.

Pfizer is being advised by Morgan Stanley & Co LLC, Centerview Advisors LLC, Skadden, Arps, Slate, Meagher & Flom LLP, Clifford Chance LLP and DLA Piper LLP.