Last week’s 40 M&A, 17 VC and 34 Partnership deals within the TMT Market

Amazing how many deals there were last week. A small overview with links to some of the companies websites or financial pages. If you have more info, please email this to me!

Last week’s 40 M&A, 17 VC and 34 Partnership deals within the TMT Market.

Last week witnessed the closure and initiation of a number of multibillion dollar deals:

– The takeover of Clear Channel by two Thomas H Lee Partners and Bain Capital can now close, as the parties have reached a settlement with the banks financing the deal. Under the settlement terms, the takeover price will be cut from USD19.4bn to USD17.9bn.

– In gaming, following a series of rebuttals since its initial bit for Take-Two Interactive in February, Electronic Arts has guaranteed up to USD1bn in debt financing from several banks to overcome the rejections based on EA undervaluing its target.

– Also, Circuit City having rejected bids for a possible takeover deal worth more than a billion based on doubts that Blockbuster will be able to finance the deal, will let the company conduct due diligence after receiving a letter of commitment from the rental giant’s largest shareholder, billionaire Carl Icahn.

– In the publishing sector, CNET’s board unanimously approved the company’s acquisition by CBS in a deal worth USD1.8bn which is expected to close in Q3 of this year. Also following the withdrawal of News Corp’s bid, Cablevision has also confirmed it is to buy 97% of Newsday as part of a USD650m takeover deal.

TomTom is set to acquire Tele Atlas for USD4.2bn after the European Commission cleared the deal between the two Dutch firms, nearly a year after it was first announced.

Vivendi-owned SFR is launching a full buyout offer for France’s second-largest ISP, Neuf Cegetel, which will make it Europe’s largest alternative telecoms operator, with combined revenues of USD18.7bn, 19m mobile users and 3.6m broadband customers.

– Finally, HP has undertaken two large deals. The company is seeking to buy BT’s UK data centres for around USD2.9bn in cash. It is also acquiring IT outsourcing firm Electronic Data Systems for approximately USD13.9bn in order to hone its enterprises services such as data centre solutions, workplace and networking services, managed security and business processes.

In web search, following Microsoft’s withdrawal of its USD44.6bn offer for Yahoo! last week, according to reports billionaire investor, Carl Icahn, has bought up to 50m shares, or a 3.5% stake worth USD1.3bn, in Yahoo! and is gaining support in his battle to overthrow Yahoo!’s board and nominate a slate of 10 directors, backed by merger arbitrage specialist Paulson & Co. In other search news, Lycos Europe is looking to foreign companies for a buyout offer following the loss-making firm’s announcement last month and Microsoft is rumoured to be interested in semantic search firm Powerset. Microsoft’s endorsement of Powerset would provide it with the brand recognition, reach and capital to make a sustainable and scalable entry to the market. However, as a technology pioneer, Powerset should probably hold steadfast as it has great potential to supplant, rather than supplement, a key player’s offering.

Apple has been extending the iPhone’s global footprint this week and moving towards a strategy of non-exclusivity partnerships with operators to rival handset competition in different regions. Singaporean telecommunications giant SingTel is set to distribute the iPhone across the Asia Pacific region later this year, along with its subsidiary, Optus, and affiliated telcos. France Telecom’s Orange has also won the rights to sell the iPhone on in a string of countries across Europe, the Middle East and Africa. Whilst in some countries Orange will be the exclusive carrier, in others the phone will be sold on a non-exclusive or co-exclusive basis.

The telecommunications space is experiencing increasing consolidation, in particular in emerging markets. In India, Bharti Airtel is considering raising its offer to South African operator MTN from USD23 per share from an initial estimated bid of approximately 21USD. Similarly, Etisalat and Vodafone are also considering bidding for the same company. Etisalat is also bidding for Indian Tata Teleservices along with billionaire Carlos Slim, buyout firm Apax Partners and America Movil. In Korea, SK Telecom has confirmed rumours that it is exploring a merger between Helio and Virgin Mobile, and in Russia, telecoms holding Sistema could be considering the acquisition of a stake in Telekom Austria, although Sistema has dismissed the rumour. Many concluded deals in the sector include Deutsche Telekom buying a 3% stake in Greece’s main telco OTE from the Greek Government for USD658m. Verizon and AT&T are both winning contracts to provide telecom services for the US Homeland Security Department, a deal worth USD970.5m. Russian mobile carrier MegaFon is selling a 39% stake to Russian tycoon Alisher Usmanov and planning to invest USD4.6bn in Iran’s third GSM licence. Verizon Wireless is completing its USD69m acquisition of the wireless assets of SureWest Communications. Finally, Alcatel-Lucent and India’s Reliance Communications are creating a joint venture to provide network services to Reliance and other telecom firms.

In social media, news aggregator Digg re-emerged in the spotlight with rumoured news that the company turned down a USD100m takeover offer in 2006 from Al Gore’s TV startup Current TV. This news comes as Digg is rumoured to be looking to raise a Series C funding round which would ultimately raise its value and further prep it for a sale.


Facebook
has raised a USD100m equity free loan from TriplePoint Capital to expand its server infrastructure as it seeks to meet rising demand.

Other moves include Comcast buying online address book Plaxo in a deal worth between USD150m and USD170m, widget development startup Sprout raising USD5m in series B funding, and Social Gaming Network raising USD15m.

Published by Reinout te Brake

Reinout is a games investor and strategic business consultant specializing in the games industry. Reinout established his credentials through his own successful investments, start-ups, consulting and (advisory) board positions that led through time to strong bonds with key stakeholders in this fast paced industry. He is known for his outstanding results in the gaming industry. He has worked with many game studios around the globe and is therefore well known in the international gaming industry. Check out his games podcast; https://www.game-consultant.com

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