Welcome back, readers! After a robust first half, the air came out of the secondary market’s balloon last year, as overall secondary deal volume fell from 2021’s record level to $108 billion, according to a report by secondary intermediary Jefferies LLC. As our own Rod James reports, limited partner-led deal value outpaced sponsor-led volume as more investors sought to offload stakes to reduce pressure from overallocation to the asset class.

Also in today’s news, Maria Armental spoke to Battery Ventures’ Morad Elhafed and Zak Ewen about the firm’s take on investment opportunities in Europe’s software sector and our WSJ Pro Bankruptcy colleague Alexander Saeedy reports that the next distressed investing cycle may not actually involve as many defaults as some anticipate.

Read on for more details on these and other stories…

The market for secondhand stakes in private capital funds slowed last year after hitting a record in 2021, Rod James writes for WSJ Pro Private Equity. Secondary market deals hit around $108 billion in 2022, an 18% decline from the $132 billion transaction volume in 2021, according to data from Jefferies LLC, which advises buyers and sellers on such deals. Uncertainty around asset valuations and increased selectivity on the part of buyers amid a deteriorating economic environment made it harder to get larger deals done, affecting overall volumes, according to a recent report issued by the investment bank.

Earlier this month, Boston-based Battery Ventures announced investments in European fleet management software providers Vimcar GmbH, based in Berlin, and Avrios International AG in Zurich with plans to combine them and build a larger pan-European company. In that effort, the venture-capital and private-equity firm is already tracking more than 100 companies in the fleet-management sector and has engaged in talks with dozens of them, according to General Partner Morad Elhafed and Partner Zak Ewen. WSJ Pro Private Equity’s Maria Armental spoke to the two men about the latest deal and the opportunities they see for software investors in Europe.

Despite a growing pile of corporate debt and signs that a recession could be on the horizon, investors that specialize in taking over troubled companies say corporate America appears well positioned to weather a possible economic downturn later this year, Alexander Saeedy reports for WSJ Pro Bankruptcy. "We are likely heading into a very unique recession, in our view," said Ryan Mollett, global head of distressed & corporate special situations for Angelo Gordon & Co., an asset manager with a $12 billion distressed and special situations platform. "We expect defaults to go up but corporate fundamentals are broadly strong," Mr. Mollett said.

The storage of hard copies of documents at the homes of President Biden and former President Trump points to risks for companies of sensitive papers being at employees’ houses. Here's a guide on how executives can handle such risks in an era of flexible work arrangements.

This research paper from WSJ Pro Cybersecurity Research, a premium service, is being made available for free to WSJ Pro Private Equity readers.

Technology-focused Thoma Bravo has agreed to acquire digital investigative tools supplier Magnet Forensics Inc. at a total equity value of about 1.8 billion Canadian dollars, equivalent to about $1.34 billion, according to a news release. The transaction will lead to the company’s delisting from the Toronto Stock Exchange, where its shares rose about 15% to C$44.10 each at midday Friday. The shares had closed Thursday at C$38.35 each. Thoma Bravo has agreed to pay C$44.25 for class SV shares of Magnet and C$39 for class MV stock, saying the price reflects a roughly 15% premium to the closing price Thursday of the SV shares. Thoma plans to combine the company with Grayshift LLC, in which it has controlled a majority interest since last July.

Stone Point Capital in Greenwich, Conn., is backing wealth manager IEQ Capital LLC with a minority growth investment that expands on an existing lender-partner arrangement, according to a news release. Foster City, Calif.-based IEQ, started in 2019, offers family office services as well as traditional advisory services, including providing access to alternative investments, and has more than $18.3 billion in regulatory assets under management.

Warburg Pincus is backing Latin American retail data analytics business Scanntech with a $40 million investment, joined by investors IFC, Endeavor Catalyst and Hindiana, according to an emailed news release. The company provides systems that collect and analyze sales data from more than 175,000 sales terminals in over 30,000 stores in Brazil. Founded in Uruguay, Scanntech generated more than 200 million reais last year, equivalent to about $38.4 million, and also operates in Argentina and Peru with clients that include consumer goods companies PepsiCo Inc., Coca-Cola Co., Mondelez International Inc. and Unilever PLC.

Midmarket-focused Quad-C Management in Charlottesville, Va. said it has agreed to acquire the QED Technologies International Inc. business of publicly traded Entegris Inc. QED supplies manufacturing equipment and materials used in making optical products such as lenses used in imaging systems, according to a news release.

Consumer-focused Provenance and growth investor Silas Capital have invested $40 million in startup cosmetics brand Makeup by Mario, according to a news release. The New York-based brand created by makeup artist Mario Dedivanovic was launched in 2020.

Capficiency Private Equity has acquired U.K. software developer ProvisionPoint Ltd., according to a news release. The company develops applications based on the Microsoft 365 bundle of programs.

Our add-on deal interactive tool allows you to sort and analyze volumes of add-on deal data compiled by WSJ Pro. View more.

Kian Capital Partners and midmarket investment firm Oakland Standard have sold fastener distributor Motor City Industrial to Bertram Capital-backed AFC Industries Inc., according to a news release. Kian initially backed the company, which at the time was called Motor City Fastener Inc., in 2015.

Blackstone Inc. has rounded up at least $15.1 billion so far for its flagship buyout fund Blackstone Capital Partners IX LP and related parallel funds, a regulatory filing indicates. Investors that have already disclosed commitments to the fund include Canadian pension manager CPP Investments, which pledged $1 billion to the offering according to information posted on its website, Public Employee Retirement System of Idaho and Minnesota State Board of Investment.

Investment banking firm Evercore Inc. appointed a company veteran from its U.S. advisory business as its new finance chief as it looks to expand in Europe and Asia and increase its technology investments, Mark Maurer reports for CFO Journal. The New York-based company on Friday said Tim LaLonde, its co-head of the U.S. advisory division and chief operating officer for the investment banking business, will take over as chief financial officer, effective March 6. Before joining Evercore in 2001, he served as an executive director at UBS Warburg, which is now part of financial-services giant UBS Group AG.

Investment bank Moelis & Co. in New York said it has hired Skip Fahrholz as a managing director based in London, working with the firm’s private funds advisory team and focusing on secondary transactions and co-investments. He joins from UBS AG, where he was head of private equity co-investments and secondaries and head of discretionary multi-vintage private equity, according to a news release.

Some of Wall Street's most speculative investors are scaling back their ambitions, doing deals that are a 10th the size of their flashy, top-of-market acquisitions, Amrith Ramkumar writes for The Wall Street Journal. Creators of special-purpose acquisition companies, or SPACs, are valuing businesses they seek to take public at the lowest levels since the boom began nearly three years ago, figures from Dealogic show. The average announced SPAC merger value has fallen to about $200 million so far this month, down from more than $2 billion for much of 2021 during the sector's peak.

Google and Microsoft Corp. this past week joined other tech companies, big and small, in cutting jobs and shelving some products and projects as the industry grapples with economic turbulence. But as The Wall Street Journal’s Sarah Needleman write, the big question now is whether these cuts will be enough.

JPMorgan Chase & Co.’s asset management arm said it has received regulatory approval from the China Securities Regulatory Commission to acquire and operate China International Fund Management Co. under the New York bank’s brand in China. J.P. Morgan Asset Management plans to integrate the operation into its local business based in Shanghai.

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