Good morning. Our Maria Armental starts us off with a scoop on Nordic Capital's deal for Arcadia Solutions in a bet that artificial-intelligence can improve healthcare.

The Journal reports that dealmaking is off to its best start in three years, despite volatility and uncertain tariff policies that appeared likely to dampen mergers.

Finally, WSJ Pro's Yuliya Chernova reports on Menlo Ventures' latest fundraising plans, which are centered on raising capital to invest in AI businesses.

Now, on to the news ...

Nordic Capital bought healthcare analytics company Arcadia Solutions, as the European buyout firm places a wager that artificial intelligence can disrupt the medical sector through better care and lower costs, WSJ Pro's Maria Armental reports. The deal also marks an exit for investors including Peloton Equity, whose predecessor firm bought Arcadia over a decade ago.

Dealmaking is off to its best start of the year since 2022, showing demand for corporate tie-ups has held up despite market turmoil, global conflicts and President Trump's ever-shifting tariffs, the Journal reports. U.S. deal value this year through June 25 rose about 10% from last year, reaching its highest level in three years. The second quarter got off to a slow start after Trump's sweeping "Liberation Day" tariffs in early April sent stocks swinging and spooked dealmakers, but activity has since rebounded.

Silicon Valley stalwart Menlo Ventures is raising a new set of funds to invest in artificial-intelligence ventures, WSJ Pro's Yuliya Chernova writes, citing people familiar with the situation. The Menlo Park, Calif.-based firm is targeting about $1.5 billion, one person said, with $650 million allocated for Menlo Ventures XVII, a fund focused on early-stage startups, and $850 million for Menlo Inflection IV, a pool for later-stage companies.

Advent International agreed to buy a controlling stake in LayerZero Power Systems, a manufacturer of products and components used by data centers. Milind Bhanoo and James Galm, the company’s founders, will retain minority stakes in the business and Annette Clayton, an Advent operating partner and former chief executive of Schneider Electric North America, will serve as chair of the company’s board.

Vitruvian Partners and ION Crossover Partners led a $359 million growth investment in enterprise security company Cato Networks, joined by existing investors such as Acrew Capital and Adams Street Partners, James Rundle reports for WSJ Pro Cybersecurity. The investment valued the business at over $4.8 billion.

Private-equity firm CC Capital Partners is still working up a binding offer for Australian wealth manager Insignia Financial, almost four months after it first opened its books to the would-be buyer, Stuart Condie reports for Dow Jones Newswires. CC Capital is actively working toward making a binding bid, according to Sydney-listed Insignia. Bain Capital in Boston made pass but withdrew from the process in May after offering 5.00 Australian dollars a share, equivalent to about $3.29.

Harwood Private Equity's deadline for making an offer to acquire financial adviser Frenkel Topping Group has been extended to July 28, Anthony O. Goriainoff reports for Dow Jones Newswires. The previous deadline was Monday. Under terms being discussed, Harwood would pay 50 pence per share for the London-listed business, giving the buyout a value of about £65.8 million, or roughly $90.3 million.

Ardian in Paris acquired 117 solar-energy installations across Italy, investing through the private-equity firm's evergreen fund devoted to clean energy. The newly acquired sites have a maximum capacity to generate as much as 116 megawatts of power.

Latour Capital in France acquired the industrial cable division of electrification company Nexans at an enterprise value of about €525 million, or roughly $615.4 million.

New York private-equity firm Stellex Capital Management agreed to acquire the air and noise filtration technology business of Dürr Group, a German mechanical and plant engineering firm.

New York midmarket firm JLL Partners is investing in medical-device company Vascular Technology, and named Greg Groenke as the company’s chief executive officer and Lars Marcher as executive chairman.

Capitol Hill Group and specialty retailer Worldwide Golf are taking private Big 5 Sporting Goods for $33.1 million, Paul Ziobro reports for Dow Jones Newswires. The buyers have agreed to pay $1.45 a share for the El Segundo, Calif.-based company, representing a 22% premium to Friday's closing price on the Nasdaq stock market.

TA Associates in Boston agreed to invest in Australian financial-services company Viridian Financial Group.

Blue Owl Capital and HealthCare Royalty are acquiring a royalty stream from publicly listed Palo Alto, Calif.-based genetic-disease company BridgeBio Pharma for $300 million. 

Specialist investor HealthpointCapital acquired a majority interest in surgical-planning software supplier ImmersiveTouch. The Chicago company provides three-dimensional models and visualization systems used by doctors to plan and perform surgical procedures.

Dallas private-equity firm CenterOak Partners recapitalized Now CFO, an outsourced finance and accounting company based in Salt Lake City, Utah.

Healthcare-focused growth investor 1315 Capital is backing pharmaceutical development and manufacturing company USpharma to help the Miami Lakes, Fla.-based business accelerate the development of its product pipeline.

Stonepeak completed its acquisition of Forgital Group, a manufacturer for the aerospace and industrials sectors, and named former GE Aerospace executive John Slattery chairman of the company’s board.

Jadwa Investment in Riyadh, Saudi Arabia, led a $50 million round backing digital fuel payment and fleet management software company PetroApp, joined by Bunat Ventures. 

Infrastructure-focused I Squared Capital and HGC Global Communications have withdrawn from making a takeover bid from Hong Kong-listed HKBN, a broadband services provider.

Lake Street Capital Partners is forming a roofing company called HighPoint Exterior Home Services, starting a roll-up strategy with the acquisition of a majority interest in Choufani & Bailey Roofing & Restoration in North Carolina.

General Atlantic has backed the acquisition of the PlanetArt division of Paris-listed software publisher Claranova through a $169.5 million transaction that included managers of the unit. New York-based General Atlantic invested through its Atlantic Park private-credit fund.

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

Retail market-data and analytics company NIQ Global Intelligence, better known as NielsenIQ and backed by Advent International and KKR & Co., registered for an initial public offering without stating how many shares it plans to sell or at what expected price range. Advent has backed the Chicago-based company since at least March 2021 and KKR has backed a predecessor since at least 2017.

European buyout firm Mutares in Munich sold a 25% stake in property and road operations and maintenance services provider Terranor Group through an initial public offering in Stockholm that gave the business a market value of about 400 million Swedish kronor, equivalent to about $42.2 million. Mutares has been a Terranor investor since 2020.

Oakley Capital in London is selling legal software supplier vLex to strategic buyer Clio at a valuation of $1 billion. Oakley has invested in the Spanish company since September 2022.

Platinum Equity-backed power generation systems company Rehlko agreed to sell its Curtis Instruments business to Parker Hannifin for about $1 billion in cash. 

Verny Capital, a Kazakh private-equity firm, and Resource Capital Funds, a U.S. fund manager, agreed to sell Kazakh gold-mining company RG Gold to Zijin Gold International, a subsidiary of Zijin Mining Group, one of the largest gold-mining companies in the world.

Simpson Thacher & Bartlett named Barrie Covit and Jonathan Karen co-heads of the law firm’s Investment Funds practice, according to an emailed statement. They replace Michael Wolitzer, who becomes chairman of funds and funds adjacencies after nearly a decade at the head of the group. The law firm has also promoted Elizabeth Cooper and Rajib Chanda to the newly created roles of global head of private equity and global head of asset management.

Ares Management has hired former Goldman Sachs executive Alessandro Verdirrame to lead the private markets firm’s Italian wealth management business, sister publication Financial News reports.

Genstar Capital named Timothy  Armour to the firm’s strategic advisory board to help focus on the firm’s financial services investments. Armour most recently was chair and chief executive of Capital Group, an active fund manager with $2.8 trillion in assets.

New York-based lower midmarket firm Soundcore Capital Partners has added to its investment team with Michael Khutorsky joining as a senior managing director and Katy Kasser as a principal. Khutorsky previously was managing director at Orix Capital Partners and Kasser was vice president at Incline Equity Partners.

Closed Loop Partners has added Daniel Phan as managing director and private equity co-head. He joins the New York firm from Aterian Investment Partners.

Piper Sandler has added veteran secondary intermediary Andy Nick to co-head its secondary capital advisory team. Nick previously was a managing director at Jefferies, where he helped found and grow the bank’s secondary advisory practice. His career also includes stints with Greenhill and Cogent Partners.

Ara Partners hired Onur Goker as a managing director at the firm’s private equity team and Solani Aggarwal as a principal. 

An internal investigation by bankrupt Steward Health Care System found that its former owner, Cerberus Capital Management, and its former chief executive, Ralph de la Torre, improperly extracted over a $1 billion in payouts from the hospital chain over the past decade when the company was insolvent, WSJ Pro's Soma Biswas reports. Independent manager Alan Carr has outlined legal claims the hospital chain’s bankrupt shell company plans to pursue as a way to claw back funds for top-ranking lenders and other creditors. Many of the payouts to Cerberus, de la Torre and other insiders were reported by the Journal last year.

A group of former investment professionals from TA Associates, H.I.G. Capital and KKR & Co. have launched Ataline Capital Management, a lower midmarket firm based in Los Angeles. Ataline’s founding team includes managing directors Ian Balmaseda and Rafael Telahun as well as principal Brian Maher, according to an emailed announcement. Balmaseda previously served at H.I.G. Capital, Telahun worked for TA, and Maher had previously worked at KKR.

Investment bank Evercore has cut ties with European private equity firm Keensight Capital, Sebastian McCarthy writes for sister publication Private Equity News in London, citing people familiar with the matter. The unusual move has led to mounting speculation over why the New York bank parted ways with the multi-billion dollar buyout shop in Paris.

Apollo Global Management in New York established a homebuilder finance operation called Olympus Housing Capital, to finance residential construction projects across the U.S., including land acquisition and site preparation. The strategy, which draws capital from Apollo funds, is led by Andrew Brausa as chief executive of Olympus.

Macquarie Asset Management launched a senior-housing company called Health Wave Partners, which will invest in properties alongside companies that operate in the industry.

A majority of limited partners are optimistic about their private markets allocations, according to a survey of private-markets professionals by asset manager Wellington Management. Nearly 96% of LPs plan to increase their private-markets investments. Only 4% of respondents indicated they would decrease their private markets allocation in the next year.

Send us your tips, suggestions and feedback. Write to:

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

Follow us on Twitter:@wsjpe, @LHVGarcia, @LauraKreutzer