Deal Dispatch: Bezos-Backed Crop Company Wilts, Tech Startup Nabs Napster For $207 Million

Bankruptcy Block

• Plenty, a vertical farming company backed by billionaire Jeff Bezos, is wilting in bankruptcy. According to the Wall Street Journal, the Bay Area startup joins the ranks of Bowery, AeroFarms and AppHarvest in the vertical farming graveyard. SoftBank was expected to take charge of Plenty's future, but instead, it's just tossed a $20.7 million DIP financing lifeline to keep the crops alive.

• According to the Nation's Restaurant News, Bar Louie filed for Chapter 11 bankruptcy protection Wednesday. The Texas-based chain operates 48 locations in the U.S. and has assets between $1 million and $10 million. Its liabilities are somewhere between $50 million and $100 million. The chain blamed rising food and labor costs as the chief reasons behind the financial issues. Bar Louie says it will restructure to reduce debt while keeping some restaurants open. Bar Louie is just the latest restaurant chain to go bankrupt. TGI Friday's, Red Lobster, Red Robin and On the Border are all burnt.

• Hooters, which is on the verge of bankruptcy, is trying to polish up its gimmick. The brand is parting ways with the decisions made by its private equity backers. Recall in 2021 when Hooters of America made waitresses wear underwear-like uniforms and participate in so-called “bikini” nights. "That's depressing to us,” Neil Kiefer, chief executive officer of HMC Hospitality Group, told Bloomberg. “We want to change that."

New On The Block

• AT&T (NYSE:T) is pursuing Lumen Technologies‘ (NYSE:LUMN) consumer fiber business. According to Bloomberg, the price tag exceeds $5.5 billion. The talks come about two months after AT&T completed a sale-leaseback deal for 74 of its properties, generating $850 million in cash.

• Searchlight Capital Partners hired investment bank Houlihan Lokey Inc. to run an auction for Survitec‘s aerospace and defense business. The buyout firm unit acquired Survitec in 2019. The sale process is indicative of the heightened demand for defense assets. Per PwC, there's been a “marked increase in portfolio reshaping” as aerospace and defense companies focus on core assets.

• Blackstone Inc. (NYSE:BX) is reportedly shopping around its ISN Software segment. The Dallas-based compliance software firm is said to be valued at over $6 billion. A bank hasn’t been hired yet, according to Bloomberg, but buyers are showing interest.

• Private equity firm I Squared Capital is seeking to divest Irish power producer, Energia Group, which is valued at approximately 2 billion euros ($2.2 billion). Bloomberg reports that the sale could attract interest from other energy firms looking to expand in the European market.

• Morgan Stanley (NYSE:MS) is planning to sell its 50.1% stake in Cuxhaven, Germany-based PNE. With a market cap exceeding 1 billion euros, PNE specializes in developing wind and solar energy projects. Reuters reports that the sale of this stake could bolster the firm’s focus on other renewable energy ventures across Europe.

Updates From The Block

• Cintas (NASDAQ:CTAS) is no longer buying work uniform provider UniFirst (NYSE:UNF). The proposed deal would have offered $275 per share in cash, a 46% premium over UniFirst's 90-day average closing price as of Jan. 6. Despite weeks of talking and little agreement, the parties have decided to call it quits. On the bright side, Cintas reported upbeat earnings.

• William Blair is advising CentralReach LLC, a portfolio company of Insight Partners, on its pending acquisition by Roper Technologies, Inc. (NASDAQ:ROP) for $1.85 billion.

• India wants to secure a stake in Chilean mining leader SQM's (NYSE:SQM) projects in Australia. This deal would give India, a lithium importer, access to critical battery minerals to cater to its growing market. The Indian consortium, led by Khanij Bidesh India Ltd (KABIL), is pursuing stakes in SQM's Mount Holland and Andover lithium projects in Western Australia. Per initial estimates, a 20% stake in these projects would be worth around $600 million.

Off The Block

• Napster, the OG of digital music, sold for $207 million to tech startup Infinite Reality. The move signals Napster's evolution from its nostalgic roots into the world of AI and all things immersive. Napster CEO Jon Vlassopulos, who used to be Roblox's global head of music, is staying at the helm—though now he's also taking on a global role at iR. This acquisition comes hot on the heels of iR's massive $3 billion funding round, pushing the company's valuation to a cool $12.25 billion. Infinite Reality’s backers include Steve Aoki, Imagine Dragons, Rudy Gobert, and Taylor Fritz.

For last week’s edition of the Deal Dispatch, click here.

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