What the Sale of Stumptown Coffee and Big Pink Mean for Portland Business
1. The Oracle Speaks!
PRECISION CASTPARTS (August)
The Deal: Some guy named Warren Buffett snapped up the aerospace manufacturer, one of Portland’s biggest companies, for $37.2 billion—Oregon’s biggest big deal ever.
Winner: Precision CEO Mark Donegan could bag $53.2 million.
Loser: Oregon now has just two Fortune 500 companies: Nike and—soon—Lithia Motors.
Takeaway: “Precision Castparts was one of the few large, publicly traded companies in Oregon. On the flip side, arguably the most successful investor in the country just gave one of our major employers a big vote of confidence.”
—Daniel Rogers, associate finance professor, Portland State University
2. Tokyo Takeover
THE STANDARD (July)
The Deal: Japan’s Meiji Yasuda Life Insurance bought Portland insurance company StanCorp Financial Group—typically known as the Standard—for $5 billion.
Winner: Shareholders (The new owners paid $115 for each outstanding StanCorp share.)
Loser: Portland’s business scene said sayonara to local control of one of the city’s largest, oldest companies—StanCorp started in 1906.)
Takeaway: “I’ve represented people against the Standard, so clearly there’s disagreement there. But they’re in my neighborhood. Whenever you have a local connection like that, it makes for better decisions. I worry.”
—Chris Roy, Portland insurance attorney
3. Amazonian Empire
The Deal: Amazon Web Services paid as much as $500 million for the video software firm.
Winner: Amazon’s realm conquers a new province—Elemental counts the likes of ABC, HBO, MTV, the WWE, and Sky among its
Loser: Anyone who hoped the term “Amazonian” would remain in Seattle
Takeaway: “Portland is blessed with some really high-gross tech companies right now, with significant venture capital investment. They’re scaling quickly and clearly positioning for exit—whether that’s acquisition or an IPO remains to be seen.”
—Linda Weston, executive director of Oregon Entrepreneurs Network
4. Macchiato M&A
STUMPTOWN COFFEE (October)
The Deal: Peet’s Coffee & Tea—owned by a Luxembourg holding company—served the PDX roaster an irresistible (undisclosed) offer.
Winner: Founder Duane Sorenson started the company in a failed hair salon about 16 years ago. That’s your American(o) dream, right there. (Too soon?)
Losers: Indie purists
Takeaway: “I think an acquisition like this could grow and play out in a bunch of different ways. I think the same analogy applies to what Starbucks did with local and regional tea companies that then grew into national brands.”
—Theodore Khoury, assistant professor of management & strategy at PSU
5. Outlook: Rosy
BIG PINK (August)
The Deal: Connecticut’s UBS Global Real Estate bought our most iconic (or at least most salmon-y) skyscraper, the US Bancorp Tower, for $372.5 million: the largest single-building deal in Portland ever.
Winner: Seattle-based minority owner Unico Properties poured $15 million into renovating the building.
Loser: Nobody! Whoever who owns Big Pink is a winner to us.
Takeaway: “It fits larger trends we’re seeing. Some of the larger investment companies, insurance companies, and real estate investment trusts are looking at Portland in ways they hadn’t.”
—Matthew Gebhardt, assistant professor of urban studies & planning at PSU