Welcome back! We kick off this morning's newsletter with a scoop. Investcorp sees ample room to back private-market firms, particularly in the midmarket. Chris Cumming reports that the Bahrain-based asset manager raised more than $1.25 billion for so-called GP-stakes deals. With investment sales still lagging, Investcorp is betting more firms will be willing to sell stakes to cover commitments for their new funds.

Next, Chris also reports on SEC Chair Paul Atkins’s statements on Wednesday at a panel discussion organized by the regulator that the SEC’s goal is “widening access to [private markets] without weakening protection.” Atkins didn't elaborate on the types of protection the agency is considering.

We have these and more. Read on…

Investcorp has raised more than $1.25 billion for its second fund to take stakes in other asset managers, a strategy becoming increasingly widespread as more private-markets firms look to take on outside capital, Chris Cumming writes for WSJ Pro. Investcorp Strategic Capital Partners II consists of $1.1 billion in fund commitments and another $155 million in investor commitments for co-investments, the Manama, Bahrain-based asset manager said Thursday. The sum exceeded the firm’s $1 billion target as well as the roughly $800 million that it collected for the 2022 predecessor fund, including co-investment capital, said Anthony Maniscalco, who heads Investcorp’s New York-based strategic-capital group. 

As concerns about private-markets funds mount, Wall Street’s top regulator on Wednesday reiterated his commitment to opening these investments to more ordinary people, Chris Cumming writes for WSJ Pro. But Paul Atkins, the chair of the Securities and Exchange Commission, said this expansion must be balanced with investor protections. The SEC’s goal is “embracing growth and innovation across all asset classes while protecting investors through guardrails that guide proper investment into these private assets,” Atkins said, speaking at a panel discussion organized by the regulator.

Braemont Capital-backed manufacturer and distributor Royal Cup Coffee and Tea is acquiring Nasdaq-listed Farmer Brothers Coffee for $1.29 a share in cash, subject to shareholder approval. The price represents a nearly 15% discount to Tuesday's close. Fort Worth, Texas-based Farmer fell to a nearly $4.9 million loss, or 22 cents a share, for its fiscal second quarter, which ended in December, from net income of about $210,000 in the year-earlier period.

Main Capital Partners in The Hague is acquiring a majority stake in software company Good Solutions in Sweden. The company's applications are used to make manufacturing processes more efficient.

GI Partners has acquired two data centers in Maryland that are leased to a single user. The firm has invested more than $8 billion so far across data centers and digital infrastructure.

Lower midmarket investor SeaFort Capital in Halifax, Nova Scotia, has acquired a majority stake in door maker Allmar, with Roynat Equity Partners and company management investing alongside the firm. Allmar has 14 locations from Ontario to British Columbia and supplies doors for residential, commercial and industrial buildings, as well as hardware.

Credit-focused Penfund in Toronto is lending $205 million to SkyKnight Capital-backed skincare provider Docs Dermatology Group in Cincinnati. The company operates more than 150 clinics in 12 states. SkyKnight has backed the business since 2022.

Emerging-markets investor Rohatyn Group in New York is providing $72 million in financing to Agropecuaria Santa Genoveva, an operator of teak plantations in Latin America. The debt is secured by land and timber assets.

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

Peak Rock Capital is selling Spatial Business Systems to Enervus, a Blackstone-backed energy data analytics company. Peak Rock acquired the AI-powered software provider for electric and gas utilities in 2022.

Urban Partners in Denmark has sold a group of nursing homes in southern Sweden to Northern Horizon. The six properties have more than 370 care units combined and were completed from 2019 to 2021. Urban had invested through its Nordic Strategies Fund III.

Technology investor STG Partners in Menlo Park, Calif., wrapped up fundraising for STG Allegro II and related vehicles with commitments totaling $1.3 billion, including $1.26 billion from fund limited partners. The firm concluded marketing for the fund after just four months of collecting commitments that exceeded its initial $950 million target. Investors in the new pool include the Los Angeles Fire and Police Pensions, which pledged up to $35 million, and the Boston Retirement System, which kicked in $5 million, according to the WSJ Pro Private Equity LP Commitments database. STG invests in smaller companies through its Allegro strategy, according to pension reports.

Within days of New Mountain Finance Corp.'s Feb. 24 disclosure of a $477 million asset sale, Chairman Steve Klinsky, the founder and chief executive of $60 billion buyout firm New Mountain Capital, began buying more shares of the firm's business development company affiliate, securities filings show. From Feb. 27 through Tuesday, Klinsky snapped up nearly 325,000 shares of the BDC worth over $11 million, according to a securities filing. Klinsky already controlled over 10% of the shares. The day his latest purchases began on Feb. 27, the BDC's shares fell to $7.65, the lowest close in at least three years. Klinsky reported paying an average of $7.75 a share for his latest additions. The stock closed Wednesday with a 2% gain at $8.15.

Lower midmarket firm Brenton Point Capital Partners has hired Evan Weinstein as a partner, Greg Martinsen as chief operating officer and chief financial officer and Alexandria Haggar as senior associate.

European authorities are weighing the creation of a secondary trading system for private-equity firms and other private-markets fund managers to sell assets, according to an announcement Tuesday. The European Commission cited barriers to exiting private-equity investments and also suggested the system might be designed to enable fundraising as well.

Morgan Stanley is laying off around 3% of its workforce or about 2,500 people, The Wall Street Journal reports, citing people familiar with the matter.  The cuts are affecting employees in the bank’s three major divisions, the people said, which are investment banking and trading, wealth management and investment management. They are tied to shifting business and location priorities—as well as individual job performance—and are occurring both in the U.S. and abroad, one of the people said.

Lending by nonbank players needs more intense surveillance by global authorities to minimize risks to financial stability, Paul Vieira reports for the Journal, citing Bank of Canada Gov. Tiff Macklem. His remarks come at a time when financial markets are on edge due to the recent military attacks by the U.S. and Israel in Iran and concerns that the boom in artificial-intelligence investment might come to an end. "Risks may be growing faster than our ability to understand and mitigate them," he said.

Infinitas Capital, the Swiss family office led by Robin Lauber, is forming an investment operation in Sweden that it intends to list publicly in Stockholm this year. The new holding company is led by Swedish market veteran Alexander Landorph, head of capital markets.

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Maria Armental; Ted Bunker; Chris Cumming; Luis Garcia; Laura Kreutzer; Isaac Taylor; Chitra Vemuri.