Dun & Bradstreet Going Private

Dun & Bradstreet has agreed to be acquired by an investor group led by CC Capital, Cannae Holdings and Thomas H. Lee Partners.

Under terms of the agreement, Dun & Bradstreet shareholders will receive $145 in cash for each common share. The transaction has a total value of $6.9 billion which includes the assumption of $1.5 billion of Dun & Bradstreet’s debt. For the fiscal year ending December 31, 2017, Dun & Bradstreet had revenues of $1.7 billion and EBITDA of $502 million. At an enterprise value of $6.9 billion, this equates to a 13.75 valuation multiple.

“Today’s announcement is the culmination of a thoughtful and comprehensive review of the value creation opportunities available to the company as part of a full portfolio and business assessment and exploration of strategic alternatives with multiple financial sponsors,” said CEO Thomas Manning. “As a result of this process, the Dun & Bradstreet Board of Directors unanimously determined that this all-cash transaction with the investor group is in the best interest of our shareholders and our company,”

“Dun & Bradstreet is a high-quality business with a 177-year history of serving its global customer base. We look forward to working with our partners and Dun & Bradstreet’s talented team to unlock the immense potential within this venerable company,” said Chinh Chu, Senior Managing Director of CC Capital. Mr. Chu founded New York-based CC Capital in 2016. He is a former senior managing director and co-chair of Blackstone’s private equity group (www.cc.capital).

Dun & Bradstreet (NYSE: DNB) provides online credit reporting, business information, commercial data, and business analytics.  The company’s database contains more than 290 million business records worldwide. Dun & Bradstreet has offices on five continents – North and South America, Australia, Asia and Europe – and is headquartered in Short Hills, NJ (www.dnb.com).

The company traces its history back to 1841 with the formation of The Mercantile Agency in New York by Lewis Tappan. In 1859, the company was sold to Robert Graham Dun who immediately changed the firm’s name to R.G. Dun & Company. In 1933, Dun merged with competitor John M. Bradstreet to form today’s Dun & Bradstreet. The company went public in October 2000.

“We are honored to partner with an established leader in the commercial data and insight industry with a long history of excellence in helping customers and partners around the globe,” said Thomas Hagerty, a Managing Director at THL. “As a private company, Dun & Bradstreet will be well positioned to reinvigorate growth and create increased value for all stakeholders.”

THL was founded in 1974 and is one of the oldest private equity investment firms in the United States. Industries of interest include consumer and retail; healthcare; media and information services; and business and financial services. Since its founding, Boston-based THL has raised over $22 billion of equity capital, acquired over 140 portfolio companies and completed over 360 add-on acquisitions (www.thl.com).

Cannae Holdings (NYSE: CNNE) is a holding company with investments in restaurants, technology-enabled healthcare services, and financial services. The firm’s investments include Fidelity National Financial (NYSE: FNF), a provider of title insurance and transaction services to the real estate and mortgage industries; Fidelity National Information Services (NYSE: FIS), a financial technology processing company; and Black Knight (NYSE: BKI), a provider of software, data and analytics to the mortgage and consumer loan, real estate and capital markets. The company is led by William Foley and is headquartered in Las Vegas (www.cannaeholdings.com).

THL and Cannae have previously worked together on other acquisitions. In 2007, the two firms acquired publicly-traded Ceridian, a provider of human resources, payroll, workforce management and tax compliance software and services, for $5.3 billion. In April 2018 Ceridian returned to the public markets (NYSE: CEN) through an initial offering that raised over $400 million.

“In an increasingly data-driven world, Dun & Bradstreet’s insight-driven business model and interconnectivity across industries has positioned the company for continued success,” said Mr. Foley. “We are excited to grow the company, increase operating efficiencies and improve the Dun & Bradstreet customer experience by providing enhanced business solutions.”

Debt financing for this transaction has been committed to by BofA Merrill Lynch, Citigroup, and RBC Capital Markets.

J.P. Morgan is the financial advisor to Dun & Bradstreet, and Cleary Gottlieb Steen & Hamilton is providing legal services. The agreement with the investor group provides for a 45-day “go-shop” period, during which Dun & Bradstreet – with the assistance of J.P. Morgan – will solicit, evaluate and potentially enter into negotiations with other parties.

Subject to Dun & Bradstreet shareholder approval, regulatory clearances and other closing conditions, the acquisition of Dun & Bradstreet by CC Capital, Cannae Holdings and THL is expected to close within six months.

© 2018 Private Equity Professional | August 9, 2018

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