Levelset’s $500M sale tops September M&A activity

By: G. F. Gay Le Breton and Ryan Gerton October 18, 2021 
https://bit.ly/2YZ32gJ

The standout Louisiana M&A transaction in September was the announcement that Express Lien (doing business as Levelset) will sell to publicly-traded construction management software company Procore, Inc. in a transaction valued at $500 million. The deal includes $425 million in cash and $75 million in Procore common stock.

The Levelset acquisition announcement comes four months after Procore’s IPO this past May.  Not only is the $500 million deal the biggest in Procore’s history, but it is also one of the biggest for a venture-backed, construction software company, surpassed only by the $900 million purchase of PlanGrid by Autodesk.

New Orleans-based startup Levelset was founded in 2007 as a company that helps facilitate lien payments for construction work and speed up the movement of money between stakeholders. Levelset founder and CEO Scott Wolfe Jr. tackled the not-very-sexy area of lien management, understanding the many pain points the lien process includes. Since its founding, 250,000 users have used Levelset’s platform for more than 6.5 million projects.

Also in September, continuing a national trend of bank consolidation, New Orleans-based First Trust Corporation agreed to sell to BancPlus Corporation, headquartered in Ridgeland, Mississippi. With $1.3 billion in assets, First Trust and its subsidiary, First Bank and Trust Company, is the 11th largest financial institution headquartered in Louisiana. Terms of the deal were not disclosed.

The acquisition builds upon both companies’ presence in Louisiana, especially in the New Orleans market, where First Bank and Trust ranks 7th in deposit market share. The transaction will combine BancPlus’ 79 branches with First Bank and Trust’s 14 across Louisiana, Mississippi, Alabama and the Florida panhandle for a total of $6.4 billion in assets. First Bank and Trust was founded by the company’s chairman and CEO Joe Canizaro in 1991.

“BancPlus is a high-performing and successful bank that is buying a strong competitor in First Trust,” according to Sherwood Briggs of Chaffe & Associates. “BancPlus is unusual because it is an out-of-state bank interested in buying a bank in Louisiana.”

Of the 14 deals involving banks headquartered in Louisiana over the past three years, only four were an out-of-state buyer acquiring a Louisiana bank. Besides First Trust Corporation, those included First Horizon’s acquisition of IBERIABANK Corporation, Hancock Whitney Corporation’s acquisition of MidSouth Bancorp in Lafayette, and First Bancshares in Hattiesburg’s purchase of FPB Financial Corp. and its subsidiary, Florida Parishes Bank, in Hammond. Of the remaining 10 transactions, six were a Louisiana buyer acquiring a bank headquartered in another state, and four were a consolidation of Louisiana entities.

Continuing a stream of 2021 acquisition activity, Lafayette-based home health, nursing and hospice giant LHC Group, Inc. announced three transactions in September. Together, they are expected to boost the company’s annual revenue by over $150 million.

In the largest deal, LHC will purchase 23 home health locations, 11 hospice and 13 therapy agencies across 22 states from a joint venture between Brookdale Senior Living and Nashville-based hospital system HCA Healthcare for an undisclosed price. The assets to be sold are located in areas that HCA Healthcare does not currently serve. The deal marks LHC’s entry into New Mexico and Minnesota and bolsters its presence in states where the company already operates.

LHC also announced deals with Generations Home Health and Freda H. Gordon Hospice and Palliative Care, both located in Virginia Beach, Virginia. The two deals will increase LHC’s annual revenue by about $7 million.

All three acquisitions will continue to operate under their existing brands and locations, following LHC’s strategy to provide multiple in-home health care services in certain markets and operating under a family of well-known local brands. Selling prices of these transactions were not disclosed.

On a year-to-date basis, LHC has executed or announced plans to conduct $308 million in M&A activity. In August, LHC upped its guidance for acquired annual revenue for 2021 to a range of $350 million to $500 million.  LHC operates in nearly three dozen states and reaches 60% of the United States’ 65-and-older population. It has approximately 30,000 employees and had trailing 12-month revenue through June 30, 2021 of $2.1 billion.

G.F. Gay Le Breton is managing director for Chaffe & Associates Inc., responsible for the merger and acquisition activities of the firm. Ryan Gerton is an associate with the firm.

Investment banking services are provided by Chaffe Securities Inc., member FINRA/SIPC.