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PE Takes Center Stage in the House | H.I.G. Closes $3.1 Billion Buyout Fund
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Good day! For those of you who missed yesterday's four-hour session on private equity in the House Financial Services Committee, our own Chris Cumming has a recap this morning. As perhaps was expected, representatives were fairly sharply divided over whether the industry helps or hurts the U.S. economy and its workers. One thing Chris notes in his story is the fact that none of the private-equity firms invited to appear sent direct representatives to the hearing, a fact that wasn't lost on the committee's chairwoman, Maxine Waters (D., Calif.).
Also in this morning's news, Ted Bunker reports on H.I.G. Capital's latest midmarket buyout fund, which closed with $3.1 billion in commitments.
Now on to today's news...
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PE Opponents, Supporters Square Off in Congressional Hearing
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U.S. Representative and Chairwoman of House Financial Services Committee Maxine Waters. PHOTO: ERIN SCOTT/REUTERS
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Private equity took center stage at the House Financial Services Committee on Tuesday, as members of Congress questioned the industry’s effects on American workers and businesses and debated ways to reform its practices, WSJ Pro Private Equity's Chris Cumming reports. Committee members proved sharply divided on private equity, with Republicans and some Democrats praising its role in creating jobs and investments, while other Democrats criticized it for extracting wealth and harming workers while raising the costs of essential services.
“While there are some examples of private-equity firms playing a beneficial role in the U.S. economy, there are far too many examples of private-equity firms destroying companies and preying on hard-working Americans to maximize their profits,” said Rep. Maxine Waters (D., Calif.), the chairwoman of the committee.
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H.I.G. Raises $3.1 Billion for Latest Midmarket Buyout Fund
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H.I.G. Capital has wrapped up fundraising for its latest middle-market leveraged-buyout fund, collecting more than its $3 billion target in barely four months, Ted Bunker writes for WSJ Pro Private Equity. The Miami-based firm pulled in $3.1 billion for its H.I.G. Middle Market LBO Fund III, 77% more than its 2014 predecessor’s total. The firm initially disclosed the fundraising to the Securities and Exchange Commission in July, saying then that it sought $3 billion and had made no sales.
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$2.3 Billion
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The amount of capital invested in commercial litigation finance deals in the U.S. between July 1, 2018, and June 30 2019, according to a report by advisory firm Westfleet Advisors.
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Olaplex produces professional hair-care products sold in salons and other retailers. Advent International has agreed to buy the company. PHOTO: OLAPLEX
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Advent International said it has agreed to acquire professional hair-care brand Olaplex. Founded in 2014 by Dean and Darcy Christal, Olaplex sells its products, including its bond-building products, which strengthen and repair damaged hair, in salons and other retailers.
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Baring Private Equity Asia has agreed to buy Lumenis, a provider of energy-based medical devices, from fellow alternative-investments firm XIO Group, Dow Jones Newswires reported. Hong Kong-based Baring said the transaction, which it expects to complete early next year, assigns Lumenis an enterprise value of more than $1 billion. London-based XIO Group acquired Lumenis for about $510 million in 2015.
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Kinzie Capital Partners, a Chicago-based private-equity firm focused on lower midmarket deals, has acquired Colony Display LLC alongside the company’s founders and management. Based in Elgin, Ill., Colony Display manufactures fixtures and displays for customers in the home improvement, retail and hospitality industries.
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Luminate Capital Partners has made a growth investment in Quantivate, which offers risk compliance software and services for banks, credit unions and financial technology companies. In connection with the deal Luminate Managing Partner Hollie Haynes, Operating Partner Scott Kingsfield, and Principal Dave Ulrich will join the company’s board of directors, according to a news release.
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Walter Capital Partners, a private investment unit of Walter Group, the investment holding company for Canada’s Somers family, said it has acquired a significant stake in Canadian funeral services provider Athos Services Commémoratifs alongside the Bourgie-Bovet family. The deal marks Walter Capital's first time backing a deal alongside external investors, the firm said in a news release.
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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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TA Associates is trying to sell Russell Investments, some four years after the firm paid the London Stock Exchange $1.5 billion for the business in 2015, Wall Street Journal affiliate Private Equity News reported Tuesday, citing the Financial Times. Seattle-based Russell advises investors with $2.3 trillion in assets and directly manages $292.7 billion, according to its website.
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Balance Point Capital has rounded up at least $85.9 million so far for Balance Point Capital Partners IV LP, more than three-quarters of the way to a $100 million offering amount, according to a filing with the Securities and Exchange Commission. Balance Point Capital provides debt and equity for midmarket companies with annual revenue ranging from $10 million to $150 million and between $3 million and $30 million of earnings before interest, tax, depreciation and amortization, according to the firm’s website. The firm raised $380 million for Balance Point Capital Partners III LP last year, according to a press release issued at the time.
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Searchlight Capital Partners said it has hired Andrew Claerhout as a partner to lead infrastructure investments at the firm alongside Partner Darren Glatt. Mr. Claerhout joins Searchlight from the Ontario Teachers' Pension Plan, where he was head of infrastructure and natural resources.
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The State of Wisconsin Investment Board, which manages assets for more than 632,000 current and former state employees, said that Anne-Marie Fink will join the pension manager as its new managing director of private markets and funds alpha. Ms. Fink, who joins on Jan. 20, will be responsible for oversight of the pension manager’s private equity, real estate, hedge funds, externally managed accounts, private debt, and venture capital portfolios, according to a news release.
New York-based private-equity firm EagleTree Capital said it has added Robert A. Gray as an operating partner. Mr. Gray has held senior roles at a number of media and business services companies, including PR Newswire, where he was chief executive, the firm said in a press release.
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Great Hill Partners has named Heather Fox Ewing as talent director for the firm, a new position. Previously she has worked in the area for several companies, including Drift.com Inc., Forrester and Winter Wyman. In April, Great Hill acquired G/O Media, a company whose brands include Deadspin, a sports news site whose editorial staff quit en masse several weeks ago in a dispute with representatives of the new owners. A Great Hill spokesman said the new position’s creation and Ms. Fox Ewing’s hiring
occurred before those incidents and was unrelated.
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The chief executive of the newspaper giant formed by the merger of USA Today publisher Gannett Co. and GateHouse Media said the new company would make deep cost reductions across its organizations, but pledged to avoid big layoffs of journalists, The Wall Street Journal reported. GateHouse Media’s parent, New Media Investment Group, is a publicly traded holding company operated by private-equity firm Fortress Investment Group LLC, which is owned by Japan’s SoftBank Group Corp.
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Advent International’s $5.2 billion bid to take private U.K. defense manufacturer Cobham PLC may be closer to winning government approval after U.K. Business Secretary Andrea Leadsom said Tuesday that she is inclined to accept security undertakings offered by the firm, Dow Jones Newswires reports. Those include abiding by current contracts and tightening existing security arrangements. But Ms. Leadsom said no decision would be made until the conclusion of a process to evaluate the remedies. Cobham shareholders approved the deal in September, and the U.K. government subsequently intervened.
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Democratic presidential candidate Deval Patrick, who resigned last week from Bain Capital, is centering his fledgling campaign on a defense of corporations and capitalism that puts him directly at odds with some of the party’s most progressive figures. “There is a role in the economy for private equity. You bet your life,” Mr. Patrick told the Associated Press on Monday in Iowa. The former Massachusetts governor is banking on his moderation and business experience, casting it as an asset and arguing that capitalism can be a force for social good.
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Oak View Group, an entertainment and sports-facilities company backed by private-equity giant Silver Lake, is slated to develop eight new arenas over the next three years, six of which will forgo major-league teams, largely to keep their calendars clear for concerts, the Journal reports.
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