Charles Zsebik is an M&A specialist who contributes to several business publications. Below, Mr. Zsebik breaks down some of the major mergers and acquisitions taking place in recent news.
David Bowie Catalog Sold to Warner
Charles Zsebik explains that David Bowie’s six-decade music catalog has been purchased by the publishing unit of Warner Music Group, which includes the late singer’s 27 studio albums and major hits.
The deal’s financial terms were not disclosed according to Chuck Zsebik, but a source close to the deal said it was worth around $250 million. Bowie, one of the most influential music innovators of his generation, died at 69 in 2016. The deal between Warner and Bowie’s estates includes songs from Bowie’s 26 studio albums, as well as the album “Toy,” released after his death.
Bowie’s hits now owned by Warner Music Group include “Let’s Dance,” “Heroes,” “China Girl,” and “Space Oddity.”
The acquisition is the latest in a slew of recently announced deals between musicians and music publishing groups reports Charles Zsebik. Among the artists recently selling their entire recording and songwriting catalogs: rocker Bruce Springsteen (for an estimated $550 million to Sony); Bob Dylan ($400 million to Universal) and Stevie Nicks ($100 million to Primary Wave Music).
Oracle Buys Cerner for $28 Billion
The Oracle Corporation has acquired digital health specialist Cerner Corp. in what is the biggest-ever buy for the database giant.
Charles Zsebik says the all-cash, $28.3 billion deal was for $95 a share for Cerner, which was founded in 1979 and is based in Kansas City. Oracle says the deal is expected to be finalized in 2022 and plans to keep Cerner’s Kanas City presence intact.
Oracle co-founder, CTO, and chairman Larry Ellison said in a statement that the deal will provide modern digital tools for those in vital medical fields. Chuck Zsebik reports that Cerner’s shares improved by 1% after news of the acquisition broke, while Oracle shares fell by more than 3%. Both companies see the deal as a step forward to expanding artificial intelligence, machine learning applications, and cloud services to health care professionals.
Oracle is the second-largest global software company in terms of market and revenue in 2020. It reported revenue of 4$40.47 billion in 2021.
Container Store Strategically Acquires Closet Works
Home organization and storage solution chain The Container Store has bought Chicago-based Closet Works for $21.5 million, part of the store’s goal to double sales according to Charles Zsebik.
Satish Malhotra, The Container Store CEO and president, said that the sale allows the company to acquire a larger part of the custom closet market, valued at an estimated $6 billion. It also will help meet increased demand for spaces built with premium wood.
Closet Works President Tom Happ will join The Container Store under his current title to assist with the acquisition. Shares of The Container Store rose nearly 12% following the deal announcement. The chain operated 93 locations across the United States in 2020, posting revenue of $895 million in 2019.
Alpargatas buys big Stake in Washable Footwear Company
Brazil’s Alpargatas SA, which owns popular sandal brand Havaianas has agreed on a deal that could see it purchase as much as $49.9% of United States-based footwear brand Rothy’s Inc.
Charles Zsebik explains that Rothy’s, valued at $1 billion as part of the transaction, will operate independently of Alpargatas specializes in shoes that are machine washable and crafted from recycled plastic. It also sells general shoes and accessories for women, children, and men. It launched a handbag line in 2020.
Alpargatas, valued at $3.6 billion, will buy shares of Rothy’s worth about $200 million. That will be followed by a $275 million offer to acquire stock from Rothy shareholders, according to a statement accounting for the stake sale. Rothy’s operates as a direct-to-consumer business, with stores located in San Francisco, New York City, Boston, and Washington, D.C.
Vox, Group Nine Agree to Merge
Chuck Zsebik reports that two of the largest influencers in digital publishing have agreed to unite. Vox Media has announced that it will now own 75% of a newly combined company, with the other player, Group Nine Media, owning 25%.
The merger is part of major expansion moves by Vox, which owners such media offerings as Vox.com, SB Nation, and tech website the Verge. In August, it bought popular food and drink site Punch.
Group Nine also owns a slew of diverse media sites, including news site NowThis, animal site the Dodo, and lifestyle giant Thrillist, says Charles Zsebik. It bought celebrity and gossip site PopSugar in 2019. According to reports, the new company is estimated to take in more than $700 million in revenue and $100 million in profit in 2022.