Minnesota firms welcome 2010 with flurry of investment, M&A announcements

Minnesota companies are starting the year with news of nine investments and acquisitions across multiple industries. Four of them have a combined price tag of $261 million, while terms were not disclosed for the other five.

The opening-week flurry of investments and acquisitions, both strategic and financial, demonstrate a willingness to put cash to work and possibly signal a pickup in deal activity by both companies and private equity firms after a moribund 2009.

Six of the announced deals were strategic, where the acquiring company is adding to an existing lineup of similar businesses, and three were financial investments.  Minnesota-based companies were on the buy side in five of the six strategic deals. 

The local activity echoes a recent national survey (PDF) of M&A professionals who look for a rebound in deal activity this year after a dismal 2009 where M&A activity declined by one-third globally.

On the strategic front:

• St. Paul-based Lawson Software (NASDAQ: LWSN) will acquire Dallas-based Healthvision Solutions through the acquisition of its parent, privately held Quovadx Holdings for $160 million, pending regulatory approval. Healthvision provides integration and application technology and related services to hospitals and large health-care organizations.

• Duluth-based Minnesota Power (NYSE: ALE) purchased a 465-mile direct current (DC) transmission line from the Square Butte Electric Cooperative for $70 million as part of a new wind generation development plan in North Dakota.

• Minneapolis-based Dolan Media Co. (NYSE: DM) acquired an additional 7.57 percent of mortgage default processor National Default Exchange, or NDeX, increasing its ownership to 92.24 percent for about $15.8 million in cash and stock. 

• Fridley-based medical device firm Medtronic (NYSE:MDT) made a $15 million investment in Lexington, Mass.-based GI Dynamics to fund development of the firm’s Gastrointestinal Liner for the treatment of Type 2 diabetes and obesity.

• Eden Prairie-based telecom equipment provider ADC (NASDAQ:ADCT) sold off its portfolio of GSM (Global System for Mobile) base-station and switching products to Irish telecom equipment company Altobridge for an undisclosed amount.

• Privately held Lerner Publishing Group of Minneapolis is acquiring Columbus, Ohio-based children’s book publisher Darby Creek Publishing for an undisclosed sum.

Financial investors were active as well:

• California-based real estate investment giant Grubb & Ellis’ Healthcare Real Estate Investment Trust II will acquire the Center for Neurosurgery and Spine, a 36,600-square-foot, two-building medical office portfolio in the St. Cloud suburb of Sartell for an undisclosed sum.

• Amcom Software, a private Minneapolis-based company, received an undisclosed but “significant investment” from Minneapolis investors Norwest Equity Partners and Split Rock Partners. The investment will fund Amcom’s ongoing operations and development of software enabling unified urgent communication in hospitals, the hospitality industry, government agencies and corporations.

• Local private equity investor ShoreView Industries acquired Medina-based Twinco Romax as a portfolio company from another private equity firm, Clearview Capital LLC, for an undisclosed sum. Twinco is a vertically integrated distributor and manufacturer of automotive fluids and related aftermarket products.  The local office of Harris Williams & Co. advised Twinco in the deal.

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