Happy Friday. Here’s what we’ve got today…

• A look at Cerberus and Glendon’s failed campaign to kill Verizon-Frontier deal

• Plus, Partners Group blames market conditions for IPO cancellation

Verizon has its way:

Verizon Communications secured shareholder approval for its $20 billion acquisition of Frontier Communications, overpowering resistance from a handful of sponsors who had campaigned against the deal.

The transaction, which values Frontier at $38.50 per share and includes around $10 billion in assumed debt, faced organized opposition from post-reorganization shareholders Cerberus Capital Management and Glendon Capital Management. The firms, which collectively control 17 percent of Frontier's equity after converting pre-petition claims in a 2020 bankruptcy, argued the deal materially undervalues Frontier's fiber infrastructure.

"At the current price, Verizon would be walking away with a steal," wrote Glendon Capital in a letter to Frontier’s board. "This simply cannot be allowed without objection."

Ares Management also participated in Frontier’s reorg and retained Houlihan Lokey to evaluate options for its 16 percent stake, though the firm did not publicly join efforts to reject the deal.

The dissent was largely focused on the growing market appetite for valuable fiber assets, which some shareholders felt wasn’t fully captured in Verizon’s offer.

As evidence, the group pointed to BCE's recent $3.6 billion acquisition of Ziply Fiber—previously part of Frontier until it was sold to WaveDivision Capital and Searchlight Capital Partners—which has a comparable network and commanded a substantially higher valuation.

Arguing that a similarly rich outcome was achievable for a pure-play fiber asset like Frontier, opponents to the Verizon deal said an offer above $50 per share was justified.

Glendon added, "Our analysis of the most recent and relevant comparable transactions as well as expected future cash flows both prove the inadequacy of a $20 billion enterprise valuation for Frontier. We urge the board to go back to the negotiation table to obtain an increased offer from Verizon.”

The apparent discount could be partially blamed on activist firm Jana Partners, which took a stake in Frontier last year and pushed for a sale of the business on an accelerated timeline vs. management's plans.

Though, in some sense, it’s now come full circle: Frontier’s last deal with Verizon was part of what pushed it over the edge into bankruptcy.

In 2016, Frontier purchased a regional telco from the carrier with what proved to be unsustainable debt financing. The company eventually filed for Chapter 11 in 2020 and emerged in 2021 after an $11 billion debt-for-equity deal was reached with unsecured bondholders, including Cerberus, Ares, and Glendon — which had the chance to build their positions at prices as low as 30 cents on the dollar, the bottom of pre-petition trading for Frontier’s unsecured notes.

The sponsors chose to relist Frontier shortly after the restructuring and quickly returned to the bond markets to finance $4.1 billion in network upgrades, transforming the business from a legacy copper-line operator into the U.S.’ largest pure-play fiber provider.

Proxy advisors ISS and Glass Lewis recommended that investors abstain from voting on the Verizon proposal, effectively opposing the current terms.

“Given the possibility of substantially more value down the line, and the lack of urgency to approve a transaction that is not projected to close for more than a year, it seems reasonable for shareholders to exercise the optionality of abstaining for the time being,” wrote ISS.

But, not everyone agreed that the offer was really that bad. BNP Paribas analysts noted that both AT&T and T-Mobile had reviewed Frontier but were unwilling to match Verizon's price.

The deal is expected to close by early 2026, pending regulatory approval.

• Insight Partners, Blackstone, and Clearlake are preparing to launch an early 2024 sale process for corporate governance software provider Diligent, which could be valued at nearly $7 billion, per Reuters.

• Carnelian Energy Capital has hired RBC to lead a sale process for Ridgemar Energy, an oil and gas producer operating in Texas' Eagle Ford Basin that could be valued at more than $1 billion, per Reuters.

• Cloudera, backed by KKR and Clayton Dubilier & Rice, agreed to acquire Octopai, an enterprise data management platform.

• Saint-Gobain is exploring the sale of its Sekurit auto glass unit, which makes glazing systems for major car brands and could fetch up to €2.5 billion; Apollo, Bain Capital, Lone Star Funds, and Platinum Equity have expressed initial interest, per Bloomberg.

• Peak Resources, a Partners Group-owned oil and gas producer operating in the Powder River Basin, postponed its planned $65.8 million NYSE IPO, citing market conditions.

• FourPoint Resources, Quantum Capital Group, and Kayne Anderson agreed to acquire Ovintiv's (NYSE: OVV) Uinta Basin energy assets for $2.0 billion.

• Elliott Investment Management announced an investment of more than $5 billion in Honeywell (NYSE: HON) and is pushing for separation of the company’s Aerospace and Automation businesses.

• General Mills agreed to acquire Whitebridge Pet Brands' North American premium cat food business for $1.45 billion from NXMH.

• Triton agreed to acquire MacGregor, a maritime cargo and load handling equipment manufacturer, from Cargotec Corporation for EUR 480 million.

• Shell (NYSE: SHEL) is in talks with interested sponsors over the possible sale of its portfolio of nature-based carbon projects, per Bloomberg.

• ECI Partners invested in Insurance Insider, a London-based industry publisher.

• STG Partners invested in TaxCalc, a UK-based provider of tax compliance and practice management software.

• Sumeru Equity Partners invested $330 million in JobNimbus, a roofing contractor SaaS backed by Mainsail Partners.

• Garnett Station Partners invested in Bristol Environmental, a provider of environmental remediation and abatement services.

• Avista Healthcare Partners made a $130 million convertible preferred stock investment in regenerative medicine company Organogenesis Holdings (Nasdaq: ORGO).

• Tapestry and Capri Holdings mutually terminated their proposed $8.5 billion merger in response to FTC antitrust litigation.

• Veritas US, backed by Carlyle Group, is nearing an agreement with lenders to restructure $4 billion of debt due in 2024.

• Whetstone Distribution, a Shore Capital Partners portfolio company, acquired Anmar Foods, a Chicago-based meat processor.

• Envoy Global, a portfolio company of Palladium Equity Partners, acquired Smith Stone Walters, a UK-based corporate immigration services provider.

• SAI MedPartners, a portfolio company of Northlane Capital Partners, acquired IDEA Pharma, a UK-based pharmaceutical market access and commercialization consultancy.

• Lynx Software Technologies, a portfolio company of OceanSound Partners, acquired Core Avionics & Industrial, a provider of development tools and software for GPU-based computing.

• Aero Accessories, a portfolio company of ATL Partners, acquired Pittsburgh, Pennsylvania-based AirGroup America, a distributor of aerospace replacement parts.

• U.S. Oral Surgery Management, an Oak Hill Capital portfolio company, acquired Brockton, Massachusetts-based Oral & Maxillofacial Surgery.

• Halozyme Therapeutics submitted an unsolicited €2 billion takeover proposal for Evotec (Nasdaq: EVT), a German drug discovery and development services provider, which is the subject of competing interest from Triton Partners, which built a 10 percent stake.

• Salt Creek Capital acquired Sinclair Designs & Engineering, a manufacturer of solar roofing systems.

• Paceline Equity Partners and Verdot Capital acquired 17 acres in Santa Fe, NEw Mexico for a built-to-rent single-family development.

• Unilever (LON: ULVR) has hired ABN Amro to lead a sale process for its Dutch food brands Unox soups and Conimex seasonings.

• 1315 Capital acquired SciSafe, a provider of biological drug storage services, from BioLife Solutions (Nasdaq: BLFS) for $73 million.

• Sterling Investment Partners acquired PROtect, a provider of enterprise safety and compliance services.

Tech, Vertical SaaS, & Misc. Enterprise

• Tessl, an AI-native software development platform, raised $100 million in Series A funding led by Index Ventures, with participation from boldstart ventures, GV, and Accel.

• OpenAirlines, a provider of eco-flying software for airlines, raised €45 million in new funding led by Eiffel Investment Group, with participation from Mirova and CRPN.

• Arbolus, an expert insights platform, raised $20 million in Series B funding led by Kayne Anderson Partners Fund V.

• JUST, a French retail checkout solution provider, raised €8 million in seed funding led by Backed, with participation from Daphni, Otium, and FJ Labs.

Fintech

• Trolley, a cross-border payments and tax compliance platform, raised $23 million in Series B funding led by Wavecrest Growth Partners, with participation from Pace Capital.

Consumer & Media

• Tourlane, a Berlin-based travel planning startup, raised €25 million in Series D funding led by Sequoia Capital, with participation from Target Global and HV Capital.

• Influur, a Miami-based influencer networking platform, raised $10 million in Series A funding co-led by Point72 Ventures and HTwenty Capital, with participation from Magma Partners, Daedalus, IGNIA, Redwood, Vamos Ventures, and Amplifica Capital.

Healthcare

• Stepful, an AI-powered healthcare training platform, raised $31.5 million in Series B funding led by Oak HC/FT, with participation from Y Combinator, Reach Capital, AlleyCorp, SemperVirens, Company Ventures, Green Sands, ECMC Education Impact Fund, Intermountain Ventures, and Cedar Pine.

• Homethrive, a caregiving support startup, raised $20 million in Series B funding co-led by TELUS Global Ventures and 7wire Ventures, with participation from Pitango HealthTech, Human Capital, Outcomes Collective Growth Capital, Allianz, and The K Fund.

• Mediaire, a German AI radiology startup, raised €12 million in Series A funding led by LBO France, with participation from IBB Ventures, Wille Finance, HTGF, LIFTT, and Gateway Ventures.

• Upheal, a documentation platform for mental health professionals, raised $10 million in Series A funding led by Headline, with participation from Credo Ventures and KAYA VC.

Industrials, Greentech, & Other

• Radiant Industries, a developer of portable nuclear microreactors, raised $100 million in Series C funding led by DCVC, with participation from a16z, Union Square Ventures, Felicis, Washington Harbour Partners, Chevron Technology Ventures, Founders Fund, Decisive Point, McKinley Alaska, Boost VC, and Also Capital.

• Elicit Plant, a French agri-biotech developing biosolutions for crop resilience, raised $48 million in Series B funding led by Carbyne Equity Partners, with participation from Sofinnova Partners, and BPI EcoGreenTech.

• Starfish Space, a satellite servicing startup, raised $29 million in new funding led by Shield Capital, with participation from Point72 Ventures, Booz Allen Ventures, Aero X Ventures, Trousdale Ventures, TRAC VC, Munich Re Ventures, Toyota Ventures, NFX, and Industrious Ventures.

• Vecna Robotics, a developer of autonomous forklifts, raised $14.5 million in new funding from Tiger Global Management, Drive Capital, Proficio Capital Partners, and Blackhorn Ventures.

• Gazelle Wind Power, a developer of floating offshore wind platform technology, raised €11.4 million in Series A funding led by Indico Capital Partners, with participation from DST Group, August One, Wah Kwong, and E2IN2.

• D.E. Shaw raised $1 billion for its latest private credit fund.

• Bek Ventures raised $250 million for its third fund focused on early-stage technology investments across Central and Eastern Europe.

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