IBM To Expand Its Cloud Services in One of 2018’s Largest Acquisitions

There were 36 M&A transactions during the week ended November 3rd, representing a total invested capital amount of $52.4 billion. The largest deal, at $34 billion, was IBM’s acquisition of Red Hat. Below are highlighted deals within Skyline’s industry focuses.

• Groendyke Transport, one of North America’s largest liquid bulk shipping operators, will acquire the assets of McKenzie Tank Lines. Based in Tallahassee, Florida, McKenzie operates a fleet of 300 trucks and 900 tank trailers through 13 terminals in the Southeast U.S. The acquisition will strengthen Groendyke’s foothold in the Southeast hazardous liquid transportation market.

• In an effort to further develop its cloud services business, IBM (NYS: IBM) will acquire Red Hat (NYSE: RHT), a provider of software and services based on the open source Linux operating system, for $34 billion. Traditionally seen as a computing hardware provider, IBM CEO Ginni Rometty is working to steer Big Blue towards more modern tech businesses, such as cloud, AI, and cybersecurity. The acquisition will give IBM a suite of existing cloud products.

• Continuing its recent push into healthy foods, PepsiCo (NAS: PEP) has announced it will acquire Health Warrior. A maker of healthy snacks, Health Warrior uses chia and other nutritional nuts and seeds in its portfolio of nutritional bars and protein powder. As consumers are increasingly demanding alternatives to sugary and fatty foods and drinks, the addition of Health Warrior will allow PepsiCo to meet that demand.

• Noosa Yoghurt, a maker of premium yogurts using fresh milk and locally sourced ingredients, will be acquired by Sovos Brands. Since Bellevue-based Noosa received a prior investment from Advent International, who also sponsors Sovos, Noosa has added 25 new flavors and added 20,000 stores to its distribution network. Sovos’s mission is to acquire trendy, premium food brands with the potential for growth opportunities through distribution and marketing investment.
  

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• Portland-based Electro Scientific Industries (NAS: ESIO) will sell to MKS Instruments (NAS: MKSI) for $1 billion. ESI is an innovator in laser-based manufacturing solutions for the micro-machining industry, and MKS is a provider of instruments and subsystems for the management of advanced manufacturing processes. The acquisition will give MKS a better understanding of micro-machining to develop its products for laser materials processing.