DealTalk: Tiktok nears data deal with Oracle; Google buys Mandiant; Mobileye files for IPO; Merit Medical explores sale; and much more
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Happy Friday!?
This week, my colleagues Echo Wang and David Shepardson delivered a massive scoop on TikTok nearing a deal for Oracle Corp to store its U.S. users' information without its Chinese parent ByteDance having access to it, hoping to address U.S. regulatory concerns over data integrity on the popular short video app .
The agreement would come a year and a half after a U.S. national security panel ordered ByteDance to divest TikTok because of fears that U.S. user data could be passed on to China's communist government.
That order was not enforced after Joe Biden succeeded Donald Trump as U.S. president last year. The panel, however, known as the Committee on Foreign Investment in the United States (CFIUS), has continued to harbor concerns over data security at TikTok that ByteDance is now hoping to address.
It is not clear whether CFIUS will find that TikTok's partnership with Oracle will resolve the national security issues it has identified.
Oracle had discussed acquiring a minority stake in TikTok in 2020, when ByteDance was under U.S. pressure to sell the app. The cloud computing giant will store all of TikTok's U.S. user data on Oracle data servers under the new proposed partnership, the sources said. Some of TikTok's data is currently stored on Alphabet’s Google Cloud.
Elsewhere, Intel’s self-driving car unit Mobileye confidentially filed for an initial public offering in the United States, setting the stage for what is expected to be one of the biggest stock market flotations of the year .
The move to list Mobileye is part of Intel's broader strategy under Chief Executive Officer Pat Gelsinger to turn around its core business.
Investors have made big bets on new technologies in the business of global transportation over the past few years, and Intel is aiming to take advantage of the demand for autonomous vehicles by listing Mobileye's shares.
Technology powering driverless cars has been gaining traction even among legacy automakers such as Ford Motor, General Motors and Toyota Motor, which have been investing on models with features such as driver-assist and self-driving systems.
Intel, however, is looking to test capital markets at a time when investor interest in IPOs has waned significantly due to recent stock market volatility amid fears of looming rate hikes and geopolitical tensions.
Traditional U.S. IPOs have raised about $2.33 billion since the beginning of the year, compared to $26.67 billion during the same period last year, according to Dealogic. In recent weeks, several companies have postponed or scrapped their plans to go public.
Meanwhile, Alphabet’s Google agreed to buy cybersecurity firm Mandiant for $5.4 billion, amid a market share battle with cloud rivals Microsoft and Amazon .
A shift to remote working during the pandemic, as well as the Russia-Ukraine conflict, has fueled a spike in cyberattacks and bolstered demand for security software, a market expected to more than double to $352.25 billion by 2026 from 2020, according to research firm Mordor Intelligence.
Microsoft was also a suitor for Mandiant, which has emerged as a go-to for companies investigating cyberattacks, including recent breaches at News Corp and Nvidia.
And finally, my colleague Chibuike Oguh and I scooped that Merit Medical Systems, a U.S. medical device manufacturer with a market value of $3.5 billion, is exploring options that include an outright sale to a private equity firm.
Merit Medical is working with an investment bank and has solicited acquisition interest from buyout firms. Merit Medical shares rose 6.2% to $64.99 after our scoop was published.
Based in South Jordan, Utah, Merit Medical manufactures and sells devices and instruments used in cardiology, radiology, oncology, critical care and endoscopy.
The company attracted the interest of activist hedge fund Starboard Value LP, which clinched an agreement in 2020 to shake up Merit Medical's board of directors.
With that, here’s a quick recap of the other highlights of the Reuters corporate finance file this week:
India has tightened scrutiny of IPO-bound firms by questioning how key internal business metrics are used to arrive at valuations, unsettling bankers and companies which fear delays in listing plans, sources with direct knowledge told Reuters.
The chief executive of crypto exchange Binance discussed buying Russian billionaire Roman Abramovich's Premier League soccer club Chelsea but has ruled out any such deal, a spokesperson for Binance told Reuters.
Snyk, a cybersecurity start-up which was valued at $8.5 billion in a funding round last year, has hired banks including Morgan Stanley and Goldman Sachs in preparations for a U.S. initial public offering (IPO), according to people familiar with the matter.
Australian NFT startup Immutable has raised fresh funding from investors led by Singapore's Temasek in a round that values it at $2.5 billion, the company said, as it taps a surge in interest in cryptocurrency and NFT ventures.
Activist investor Clearway Capital has written to the board of French energy major TotalEnergies calling on it to exit its Russian operations in light of the war in Ukraine or face a vote on the issue at its next shareholder meeting.
Private equity firm EnCap Investments is exploring a sale of U.S. oil producer Ameredev II, seeking more than $4 billion including debt for the Delaware Basin operator, people familiar with the matter said.
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Oasis Petroleum and Whiting Petroleum will merge in a $6 billion deal including debt, the U.S. shale oil and gas producers said.
Cornerstone Building Brands, a manufacturer of exterior building products, said on Monday it has agreed to be taken private by shareholder Clayton, Dubilier & Rice (CD&R) in a $5.8 billion deal, including debt.
Pearson said it had rejected two takeover approaches from investment firm Apollo, saying its latest $8.5 billion possible cash offer undervalued the global education group, which was confident in its own strategy.
Discovery shareholders voted Friday to approve the media company's $43 billion merger with WarnerMedia, moving the deal one step closer to completion.
Billionaire investor William Ackman has built a new stake in railroad operator Canadian Pacific, returning to one of his most profitable investments as rail firms eye a boost from the drive to cut carbon emissions and as manufacturing is brought back to the United States and Mexico from abroad.
Ryan Cohen's RC Ventures LLC, which owns nearly 10% of Bed Bath & Beyond BBBY.O , has hired a proxy solicitor, signalling the firm is ramping up for a potential proxy fight at the housewares retailer, two sources said.
Department store operator Kohl's, which rejected two separate takeover bids earlier this year, said that it had made contact with more than 20 parties and signed confidentiality agreements with some, giving them access to more financial data.
Hedge fund Third Point LLC is pushing Cano Health to put itself up for sale because the senior-care facility operator's stock price has tumbled since it went public via a SPAC merger.
Dollar Tree reached a settlement with activist investment firm Mantle Ridge and is adding seven new directors to its board, including a former chief executive from rival discount retailer Dollar General.
LanzaTech NZ Inc said it plans to go public by merging with special purpose acquisition company AMCI Acquisition Corp II, in a deal that values the carbon recycling technology company at $2.2 billion.
Axonius has raised $200 million from investors led by venture capital firm Accel at a valuation of $2.6 billion, in what the cybersecurity startup says could be its last funding before a public listing.
Thank you for reading this week’s edition! Please do share the newsletter with anyone you think might be interested – feedback will be most welcome.
Have a great weekend!
Warm regards,
Anirban?
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Anirban Sen
U.S. M&A Editor in Charge
Thomson Reuters
Twitter: @asenjourno