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Private Equity Daily: Bain Closes Second Impact Fund | Biden Win Spurs Climate-Tech Startups
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Good day! There are few policy areas touching private equity that could see bigger changes under a Biden administration than environmental, social and governance investing. ESG strategies have collected more money than ever before in the years leading up to the coronavirus pandemic, despite the decided lack of friendliness shown by the Trump administration.
Still, it is investors, not policymakers, who are fueling the ESG boom, and that demand is likely to stay strong, whatever happens in Washington, D.C. Today, Laura Kreutzer reports that Bain Capital has closed its second impact fund at more than twice the size of the first, despite raising the vehicle during a pandemic that made travel and due diligence difficult. Bain’s Double Impact unit collected $800 million for the fund, compared with $390 million for the first.
Next, Yuliya Chernova reports on how Joe Biden’s win has given new life to clean-energy companies, which hope a new administration will support investment in their sector. Venture-capital investors focused on sustainability are betting Mr. Biden—whose slate of proposed environmental policies includes shifting to electric vehicles and upgrading buildings for energy efficiency—will help the sector grow faster.
Now on to today's news...
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Bain Capital’s second Double Impact fund is more than twice the size of its predecessor.
PHOTO: KIM KYUNG HOON/REUTERS
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Bain Capital’s Double Impact investment team has rounded up $800 million for its second impact investment fund, more than double the size of the fund’s predecessor, Laura Kreutzer reports for WSJ Pro Private Equity. The firm raised the new fund amid a challenging fundraising environment and expanded its base of overseas investors, which accounted for around one-quarter of the new fund’s capital.
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Venture capitalists that back startups focused on renewable energy or technology that addresses climate risk are looking forward to a presidential administration that is more supportive of their businesses, as Yuliya Chernova writes for WSJ Pro Venture Capital. Addressing climate change is a top issue for President-elect Biden. Mr. Biden’s plan for a “clean energy revolution” calls for a shift to an economy that produces zero net carbon emissions and relies fully on clean energy by 2050.
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$14.6 Billion
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The amount of capital raised globally by impact investment funds in 2020, through Nov. 20, according to data provider Preqin Ltd.
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Samples in a lab for a precision medicine initiative. Blackstone Group has backed Precision Medicine Group, a company that provides drug development services. PHOTO: Jesse Neider for the Wall Street Journal
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Blackstone Group Inc. is backing drug development services provider Precision Medicine Group, investing alongside management as well as existing investors that include Berkshire Partners and TPG Growth. The New York-based firm invested in the Bethesda, Md.-based company through a recapitalization. Precision Medicine helps its customers develop and deliver more targeted treatments for patients, the company said in a press release.
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KKR & Co. has acquired an industrial property in Phoenix for about $32 million from Cohen Asset Management, expanding its holdings around the Arizona city to nearly two million square feet. The New York firm invested through its Real Estate Partners Americas Fund II.
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Our add-on deal interactive tool allows you to sort and analyze volumes of add-on deal data compiled by WSJ Pro. View more.
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Blackstone Group Inc. has closed its $14.6 billion deal to sell a portfolio of properties designed to accommodate life-sciences businesses to a group of existing investors and Blackstone core-plus perpetual funds. The sale by Blackstone Real Estate Partners VIII LP was expected to generate a $6.5 billion gain for the fund and co-investors, who were invited to reinvest in the properties through the transaction. The collection includes 93 properties and is concentrated in urban areas that have been hotbeds of biomedical and pharmaceutical research, including Boston, San Diego and San Francisco. The Blackstone real estate fund acquired the bulk of the portfolio in 2016.
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CoStar Group, Inc., one of the world’s largest providers of commercial real-estate information and analytics, has taken its first major step into the residential data business by agreeing to pay $250 million for venture capital-backed Homesnap Inc., Peter Grant writes for The Wall Street Journal. Homesnap has received funding from firms that include Update Partners and Moderne Ventures.
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Ardian has sold an office building in the financial district of Paris to the Caisse de Retraite du Personnel Navigant pension system. The 3,700 square-meter building is currently being renovated and the buyer plans to move in next year, Ardian said in a news release.
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The Washington State Investment Board helped private-equity firm GTCR collect $7.5 billion for its latest buyout fund with a pledge of as much as $600 million for the vehicle. The fund, which had a $6.75 billion target, also received commitments from the Teacher Retirement System of Texas, for $100 million, and from the Ohio Police & Fire Pension Fund for up to $30 million. GTCR Fund XIII significantly increases the Chicago firm’s assets under management, which totaled roughly $11.6 billion at the end of last year, a regulatory filing shows. GTCR said it raised the money in less than five months, despite the coronavirus pandemic’s effects on
travel and face-to-face meetings.
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I Squared Capital received pledges of $350 million and $150 million for its third infrastructure fund and a related sidecar, respectively, from the Washington State Investment Board at its meeting Thursday. The board said the Miami-based investment manager aims to raise $12 billion for its ISQ Global Infrastructure Fund III LP, which would be more than double the target for its predecessor vehicle. But I Squared collected about $7 billion for that fund, its second, closing it to new investors in September 2018. The Washington fund pledged as much as $250 million to the earlier vehicle, WSJ Pro Private Equity data show. Evercore is listed as the placement agent for the fund in regulatory filings.
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PineBridge Investments has rounded up at least $350 million so far for PineBridge Secondary Partners V SLP and a related parallel fund, regulatory filings indicate. The firm collected $568 million for its fourth secondary fund back in 2018, according to a press release issued at the time. That fund focused on small to midsize secondary deals in both developed and emerging economies.
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Ruby Tuesday Inc., a restaurant chain backed by NRD Capital Management, received speedy court approval for a sale process after the bankrupt company made last-minute changes sought by major landlords, Becky Yerak reports for WSJ Pro Bankruptcy. The Maryville, Tenn.-based chain sought chapter 11 bankruptcy protection last month because of fallout from the coronavirus pandemic and continued pressure on the casual-dining sector. The court ruling opens the way for bidding to begin, and NRD is considered a potential entrant in the sale process.
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Multi-strategy investment firm GCM Grosvenor Inc. reported a roughly 3% increase in assets under management during the third quarter, with the total rising to about $58.55 billion from $56.89 billion in the second quarter. The Chicago firm said the total at the end of September was up about 1.4% from the $57.75 billion it had at the end of last year. Committed assets that were not yet generating fees climbed 29% to $6.64 billion at the end of the third quarter from $5.15 billion at the end of last year. The firm, which began trading on the Nasdaq stock market last week, said third-quarter operating income plunged 74% to about $9.2 million from roughly $35.6 million in the same period of 2019.
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Facing the possibility of another two years of divided government, Democrats and Republicans in Washington are eyeing a familiar topic as a possible area of bipartisan compromise under the Biden administration: infrastructure, Andrew Duehren writes for The Wall Street Journal. Efforts to craft a major bill repeatedly fell apart during the Trump administration, and disagreements on the scope of the legislation and how to pay for it will persist under a new president. But a fresh push from the next White House could break the logjam, even if control of the House of Representatives and Senate continues to be split between the two parties.
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