Thanks to the ACG InterGrowth team for a great conference this week. The conference, which had a vibe of cautious optimism, seemed to reflect the general M&A climate this week — Time Warner and CBS may be ripe for a merger, Goldman Sachs and Nomura reported strong earnings, and global PE funding was surprisingly high.
In other news, clean tech investments are not as bad as they seem, Fab is launching a new round of fundraising for a $1 billion valuation, and mezz may be making a comeback.
Time Warner, CBS Seen As Candidates For Merger: Although the two media powerhouses have collaborated for years, a more formal union between TWC and CBS may be near. Citing favorable valuation trends and clear synergies, analysts view the two as natural fits. Whether Sumner Redstone agrees is an entirely different matter.
Goldman Sachs Scores an Investment Banking Win Over Morgan Stanley: Tuesday was a good day for Goldman Sachs, as it reported its best quarterly investment banking revenues since 2009. The strong earnings helped Goldman edge out its usual competitor, Morgan Stanley, from the top. But Nomura may be nipping at its heels.
Global Private Equity Funding Solid in 1Q: Private Equity International recently announced that Q1 saw over $69 billion was raised by 130 PE firms around the globe. Although the amount raised is in line with 2012 numbers, the capital raised collectively exceeded fund targets by nearly $10 billion. Maybe the fundraising environment is not as bad as everyone anticipated.
Fab is Raising a Mondo Round at a $1 Billion Valuation: It sounds like Fab, a design-focused retail site, is leading a new round of fundraising at a $1 billion valuation. With past investors like Andreessen Horowitz, First Round, and Ashton Kutcher, there are rumors that new investors may come from Asia. Does the company’s 12 million users and growing revenue stream justify the 10-digit valuation?
Flawed Bidding Process Leaves Dell at a Loss: The spotlight on the Dell buyout has drawn some attention the “go-shop” period that has become standard to many deals. Despite their desired outcome, go-shops rarely result in higher offers. Why, then, did Dell choose to adopt the strategy so aggressively? Will Dell’s go-shop become a cautionary tale for future mega-deals?
Just How Bad Were Clean-Tech Investments?: According to data released by Cambridge Associates, clean tech investments may not be as failure-prone as some believe. The data — which reviewed over 1,200 deals since 2000 — learned that the gross IRR of a clean tech investment was 6.6%. While not great, it shows that clean tech is about as profitable as nearly any other venture capital investment.
Mezzanine Makes Its Comeback: While the popularity of mezz debt has ebbed and flowed over the past thirty years it seems to be back in vogue, although in a slightly different format. Ed Cottrell argues that the recent lending squeeze has led many firms in less popular industries and markets to rely on mezz and other subordinated options to continue financing their business.
Do’s & Don’ts For Newly Public Tech Companies: After Facebook’s costly IPO, many tech companies have been cautious about going public. To avoid repeats, Glenn Solomon outlined some points for a successful IPO. For example, it is important to focus on fundamentals, to be respectful of the investment community, and to not use shareholder funds unwisely.
Also — Fred Amoroso, Yahoo’s chairman of the board, resigned from his position late Thursday night.
Arborview Capital recently joined the Axial network to invest in established, rapidly growing energy efficiency and clean energy businesses in North America. The Arborview team explained, “We believe that several fundamental shifts in energy markets are creating attractive opportunities for investment in the clean energy sector.” The firm focuses on businesses with $5 – $30 million in revenue and with a strong market presence.