Busy quarter for private, public deals

The September quarter update to the BNiQ deals database shows that UBS, Sternship Advisors and Azure Capital have been the most active corporate advisers in the Western Australian market.

The ranking of UBS and Sternship on the deals ‘league table’ was helped by their role as advisers to Pacific Energy, which received two competing takeover offers during the September quarter.

Sternship also had an advisory role with gold miner Silver Lake Resources (bidding for Egan Street Resources) and with takeover target Echo Resources.

Azure advised OPTrust and Infrastructure Capital Group on their unsuccessful $470 million bid for Pacific Energy.

It also advised Australian Finance Group on its $120 million acquisition of east coast business Connective Group.

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Azure is currently advising Azumah Resources, which is vigorously defending a $26 million takeover bid lobbed by existing shareholder Ibaera Capital.

The BNiQ database records a total of 203 WA-related corporate finance deals in the September quarter.

This comprises 64 announced M&A transactions worth $2.35 billion and 139 completed equity capital markets deals worth $1.39 billion.

Among the law firms, it was a busy quarter for DLA Piper.

It advised on four M&A transactions, with clients including Pacific Energy, Echo Resources and Resolute Mining.

While most of the large M&A deals involved ASX-listed companies on both sides of the transaction, the September quarter featured several notable private deals.

A consortium comprising Fini Group, Linc Property and CFC Group subsidiary Birchmead acquired Midland Brick for $86 million. 

As well as buying an operating business that has been squeezed by the downturn in the residential construction market in WA, the buyers recognise big property development opportunities utilising Midland Brick’s land holdings.

In another private deal, Sydney-based investor Allegro Funds acquired a minority shareholding in Perth Radiological Clinic, for an undisclosed sum.

This was the latest in a string of private sell-side mandates PwC has completed.

Other examples in recent years include seafood producer Kailis Bros, mining software developer Micromine and health services business APM.

In each case, PwC advised the private owners on the sale of a majority shareholding.

Corporate partner Chris Bingemann said PwC’s ability to executive sell-side mandates was helped by its relationship with private equity funds.

“We have a very strong private equity network over east, that’s through doing M&A and transactional work,” he said.

“We have the relationships which we can bring west for transaction opportunities.”

As reported elsewhere in this feature, PwC is also seeking to advise on more public market transactions, following its role advising Saracen Mineral Holdings on two acquisitions.

Big trades

The value of ECM deals in the September quarter was boosted by some large block trades.

Gold Fields offloaded $126 million worth of shares in Gold Road Resources through Macquarie Capital, while Gresham Partners sold a $90 million holding in Perenti Global (formerly Ausdrill) through JP Morgan Securities.

Macquarie topped the quarterly league table after being lead manager on three substantial transactions, including capital raisings for struggling lithium miner Pilbara Minerals and aspiring potash producer Kalium Lakes.

A notable development during the quarter was the $50 million initial public offering by mining services company Mader Group, led by Bell Potter Securities.

This followed a very lean period for WA-related IPOs with just a handful of completed deals this year.

The solid support for Mader shares after they started trading on the ASX augurs well for additional deals in the pipeline.

Canning Vale-based DDH1 Drilling and Kalgoorlie-based contractor MLG are both hoping to complete IPOs and list on the ASX before the end of the year.

The buoyancy in the mining services market is helping this goal, underpinned by strong investment in Pilbara iron ore projects.