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Alpine Sets a Bold Fund Target | Fanatics Valued at $31 Billion
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Good day. Today we have a look at a new buyout fund that Alpine Investors aims to raise, as our Rod James reports that the firm has a goal of collecting nearly 70% more than it brought in for a predecessor vehicle. Alpine's ambitions run counter to the trend among peers to rein in fundraising as institutional investors find they have lopsided portfolios weighted to private equity after sharp declines in publicly traded securities.
Also, our Journal colleague Miriam Gottfried reports that a collection of investment firms and others have pumped around $700 million into Fanatics, the operator of sports-related businesses. The deal values the company at $31 billion.
We have these stories and many more laid out and linked for you below so please wade in...
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A supermoon rises over downtown San Francisco, home to Alpine Investors, framed by the Golden Gate Bridge. PHOTO: JOSE CARLOS FAJARDO / ASSOCIATED PRESS
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Alpine Investors is targeting $3.8 billion for its ninth flagship fund, or about 69% more than it collected for a predecessor vehicle, according to public documents prepared for the Arkansas Teacher Retirement System, which is investing as much as $30 million, Rod James reports for WSJ Pro Private Equity. Alpine’s raised target for the new pool is increasingly rare in today’s market for private-equity funds. Volatility in securities markets and a freeze up in initial public offerings has caused many fund investors to become over-committed to the asset class, forcing them to write smaller checks to new funds or to hold off on new investments. San Francisco-based Alpine will use Alpine Investors IX
LP to acquire smaller and midsize software and technology services companies where it can install new management teams and expand through acquiring smaller operations, the documents show.
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Fanatics Inc. has received an investment totaling about $700 million from a group of investors, pushing the sports-merchandising company’s valuation to $31 billion, The Wall Street Journal’s Miriam Gottfried reports, citing people familiar with the matter. About two-thirds of the investment came from parties that hadn’t previously backed the company, including private-equity firm Clearlake Capital Group, which led the deal, and investment bank LionTree LLC, the people said. Prior Fanatics investors such as Silver Lake, Fidelity Management & Research Co. and SoftBank Group Corp. were also among the participants,
they said.
Investors are demanding a change of tune at Hipgnosis Songs Fund Ltd., the London-listed investment vehicle that owns the rights to tens of thousands of songs written by artists such as Shakira, Lindsey Buckingham and the Red Hot Chili Peppers, the Journal's Julie Steinberg and Anne Steele report. It was was founded by Merck Mercuriadis, a former pop-star manager who has called catalog copyrights recession-proof, and better than investing in oil or gold. The company thrived in an easy-money era of high stock prices and cheap debt, growing through a string of deals, while Mr. Mercuriadis attracted a big-name financial backer in Blackstone Inc. But the listed vehicle’s stock
price has tumbled in recent months. A large discount has opened to the net asset value of its holdings, suggesting concern that Hipgnosis may have overpaid for its 65,000-plus song library.
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Clinisupplies provides hospitals in the U.K. with urology products and supplies. PHOTO: ANTHONY DEVLIN / BLOOMBERG NEWS
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KKR & Co. said it is acquiring continence-care products company Clinisupplies Ltd. in the U.K. from Apax Partners-backed Healthium MedTech Ltd. in India, investing alongside company management. The urology products maker in the U.K. has about 400 workers and supplies hospitals, pharmacies and consumers directly through its home-delivery service. The New York firm is backing the business through its $4 billion KKR Health Care Strategic Growth Fund II.
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Pictet Alternative Advisors and Vivo Capital led a $52 million investment in Jeito Capital-backed Pulmocide Ltd., joined by nine other investors as well as Paris-based Jeito, according to a news release. The biopharmaceutical drug development company based in London is working on treatments for lung infections.
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Investcorp has acquired a majority interest in business advisory company CrossCountry Consulting, with the Public Sector Pension Investment Board co-investing, according to a news release. Backer RLH Equity Partners is retaining a minority stake in the McLean, Va.-based company, which has more than 700 professionals working across the U.S.
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Runway Growth Capital, a venture and growth debt investor, said it provided an $80 million senior secured term loan to Extensiv, a supply-chain and e-commerce technology business. The company plans to use the capital to refinance existing debt and for working capital, according to a press release.
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Growth investment firm Edison Partners in Princeton, N.J., led a $21 million investment in Lokavant, a clinical trial data intelligence company, according to an emailed press release. Publicly traded pharmaceutical company Roivant Sciences is also participating in the investment.
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Kian Capital Partners, a midmarket firm in Charlotte, N.C., said it has increased its investment in Sdii Global Corp., a Tampa, Fla.-based forensic engineering firm that specializes in supporting claims resolution for property and casualty insurers. Kian initially backed the company in 2016, providing $8 million in senior secured debt to support a buyout from its founder, according to Kian’s website. Separately, Kian has rounded up at least $186 million so far for Kian Growth Partners III LP, a regulatory filing indicates. The amount raised so far puts the fund more than halfway toward a $225 million offering amount indicated in the filing.
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Investment firm Mercia Asset Management PLC said it has acquired regional U.K. lender Frontier Development Capital Ltd. for as much as £9.5 million, equivalent to about $11.6 million, plus net cash in a deal that will increase Mercia’s assets under management by about £415 million, according to a regulatory filing in London. Publicly traded Mercia said it now has about £1.4 billion in profitable AUM, near a £1.6 billion goal established for a three-year period ending in March 2024.
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Bernhard Capital Partners in Baton Rouge, La., said it has acquired engineering and consulting firm Boston Government Services LLC and project-management services provider Sterling Engineering & Consulting Group LLC and combined them into a a business focused on the U.S. Energy Department and organizations that operate within its sphere of influence. Boston Government Services is located in Oak Ridge, Tenn., while Sterling is based in Richland, Wash.
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With takeover speculation swirling around Coupa Software Inc., one of the enterprise software company's biggest shareholders is urging caution on the price, Colin Kellaher reports for Dow Jones Newswires. HMI Capital Management, which says it has a roughly 4.8% stake in San Mateo, Calif.-based Coupa, says it would oppose any deal that undervalues the company, which HMI thinks could be worth over $95 a share based on future growth and value creation. Coupa shares rallied late last month after a Bloomberg News report that
Vista Equity Partners held talks with the company about taking it private. But the stock is still down roughly 60% this year.
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Ascend Capital Partners is backing a primary care doctor group in Florida alongside leaders of physician practice management company CareAbout in New York, according to a news release. The company, Medical Specialists of the Palm Beaches, serves people in two South Florida counties through 25 office locations and 85 care providers.
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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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A blank-check company backed by Ares Management Corp. has agreed to combine with nuclear fuel technology and reactor developer X Energy Reactor Co. at an equity value of about $2 billion, according to a news release. The special-purpose acquisition company, Ares Acquisition Corp., raised about $1 billion through an initial public offering in February 2021 and is led by David Kaplan, an Ares co-founder and partner who is a co-chairman of the firm’s private-equity group, according to data provider Boardroom Alpha. Rockville, Md.-based X Energy is developing small modular reactor technology and a proprietary fuel. X Energy’s backers include Ares, hedge fund Segra Capital Management and Ontario Power Generation Inc. as well as other strategic investors.
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A special-purpose acquisition company led by investor Byron Roth has agreed to combine with solar power and energy storage company Tigo Energy Inc. in a deal that values Tigo at about $600 million, according to a news release. The SPAC, Roth CH Acquisition IV Co., is led by Mr. Roth, who is also chairman and chief executive of Roth Capital Partners, an investment bank in Newport Beach, Calif., and the founder of several private investment firms. Roth CH raised about $115 million in an initial public offering of shares in August 2021, according to data provider Boardroom Alpha. Campbell, Calif.-based Tigo makes components used in commercial- and
utility-scale solar systems and for residential use.
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Another special-purpose acquisition company led by Gores Group founder Alec Gores is tossing in the towel on finding a business to combine with and wants to return the $345 million it raised in February 2021 to investors, Will Feuer reports for Dow Jones Newswires. Mr. Gores is chairman of the blank-check company, Gores Holdings VIII Inc., which cited the looming 1% tax on stock buybacks starting next year under the Inflation Reduction Act. Last month, three other SPACs tied to the Gores Group said they planned to liquidate before year-end to avoid the tax. Another blank-check company that raised $345 million, One Equity Partners Open Water I Corp. led by
One Equity Partners executives, said in October that it would liquidate in part to avoid the tax.
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Vance Street Capital has sold aviation services provider International Aerospace Coatings to Tiger Infrastructure Partners, according to a press release. Vance Street’s investment in the company, which offers aircraft painting, aviation technical services, aircraft interior refurbishment and aircraft graphic services, traces back to 2012, when the Los Angeles firm acquired Leading Edge Aviation Services Inc. The firm formed IAC in 2014 through the merger of Leading Edge with two other aviation companies Associated Painters and Eirtech Aviation, according to Vance Street’s website.
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Partners Group Holding AG in Switzerland said it has agreed to sell energy development company CWP Renewables in Australia to Squadron Wind Energy Assets. The group to be sold operates wind generating installations capable of producing more than 1.1 gigawatts of power and has projects totaling as much as 15 gigawatts in early stages of development. The firm began investing in what would become CWP in 2016, investing through its Private Infrastructure strategy.
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Recently formed Avalon BioVentures has raised $135 million for its debut fund, WSJ Pro's Brian Gormley reports. The LaJolla, Calif.-based firm was set up by former biotechnology investors with Avalon Ventures.
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Intermediate Capital Group PLC in London said it has tapped Devarshi Das to lead a new office focused on Asia-Pacific infrastructure investments involving midsize companies. Mr. Das leads a group of five professionals in Singapore and Sydney as managing director and head of Asia-Pacific Infrastructure Equity. The firm said Isabelle Demir and David Richardson join the office as managing directors, along with Hector Wang as principal and Mark Teoh as associate. Mr. Das and his team join from Keppel Capital’s alternative assets group while Ms. Demir comes aboard from Infrastructure Capital
Group.
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Moonfare GmbH, operator of a digital system for private-equity investors that caters to wealthy individuals, said it has added Jon Kamaluddin, a former chairman of European fintech company Klarna AB, to its global advisory board. Berlin-based Moonfare also has expanded its investment team, hiring Sanjay Gupta as head of co-investments and Russell Lane as head of GP solutions, according to a press release. Mr. Gupta previously served as head of private-equity investing at Union Bancaire Privée in London, while Mr. Lane joins from hedge fund manager Bridgewater Associates.
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Marc Steinberg, a senior portfolio manager at Elliott Management Corp. is joining the board of directors at Pinterest Inc., part of a commitment the social-media company reached with the activist investor to help it grow, Sarah Needleman writes for The Wall Street Journal.
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Goldman Sachs Group Inc. Chief Executive David Solomon signaled Tuesday that the firm will likely have to trim its operations as it deals with a slowing economy, AnnaMaria Andriotis reports for The Wall Street Journal. Mr. Solomon, speaking at The Wall Street Journal’s CEO Council Summit, said the idea shouldn’t come as a surprise given how closely the firm’s growth is correlated to the global economy. He also noted that the banking industry hired aggressively during the pandemic deal-making boom of 2020 and 2021. Many corporate leaders who were thinking about acquisitions or initial public stock offerings when they entered this year now are waiting to see what the next months bring.
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NRG Energy Inc. said it agreed to buy home-security business Vivint Smart Home Inc. for $2.8 billion, as the energy-services company pushes to have a presence in more American homes, Will Feuer reports in The Wall Street Journal. Houston-based NRG said Tuesday it would pay $12 a share for Vivint, which offers integrated home systems that include security, lighting and other services. The price marks a 33% premium to Vivint’s closing price on Monday of $8.99 a share. Including debt, the companies put the total deal value at $5.2 billion. NRG shares sank 15% while Vivint jumped 32%.
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Former President Donald Trump’s family business lost its fight against criminal tax fraud charges, with a New York jury finding that the Trump Organization engaged in an off-the-books compensation scheme to pay some executives in car leases, apartments and cash, Corrine Ramey reports for The Wall Street Journal. The jury found two Trump Organization corporate entities guilty of all criminal counts they faced, including conspiracy, criminal tax fraud and falsifying business records. The two entities could face a total
of more than $1.6 million in fines.
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Brazil has long been known as a renewable-energy powerhouse, thanks to a geography that’s ideal for generating hydropower. Now, with the incoming administration pledging to boost environmental policies, hopes are rising for further government support for investment in renewables such as wind and solar, writes Paulo Trevisani for WSJ Pro Sustainable Business. For companies under pressure to decarbonize, Brazil’s clean-power market offers some advantages, including an established renewable-power-generation infrastructure, historically supportive government policies and abundant natural resources, including lots of sunny days and windy nights. The government, meanwhile, welcomes renewables
projects as they can generate jobs and extra income for communities plagued by poverty.
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Investor skepticism about using environmental, social and governance performance metrics is increasingly challenging for U.S. asset managers, WSJ Pro Private Equity’s Luis Garcia reports for Dow Jones Newswires, citing a survey by research and consulting firm Cerulli Associates. The research cited views that ESG measures are motivated by politics. The survey showed that 75% of U.S. asset managers see politics in ESG, representing a moderate challenge for efforts to increase client receptiveness to ESG issues, Cerulli said. That’s up from 49% last year.
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