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iCapital's $860 Million Valuation | Warburg-Backed Oil Fund Files for Bankruptcy | San Francisco Pension Issues Rallying Call
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Good day! Here in Massachusetts most of us are sheltering in place as the great social distancing experiment continues. Yesterday the markets continued to plunge as lawmakers in the U.S. Senate wrangled unsuccessfully over a rescue package aimed at supporting an economy that is already feeling the fallout from the spread of coronavirus. Private-equity firms no doubt are seeing that fallout in some of their portfolio companies. Hopefully senators will be able to resolve the impasse in the coming days before the damage gets too severe to recover.
Now, onto the news of the day, including some that is entirely unrelated to Covid-19...
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Financial-technology company iCapital Network, which raised $146 million from new investors, served more than $46 billion of investor wealth on its platform at the end of last year. PHOTO: MOHAMED ABD EL GHANY/REUTERS
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Financial-technology company iCapital Network Inc. raised $146 million from new investors led by China’s Ping An Insurance Group and including Goldman Sachs and Hamilton Lane, as well as previous backers, the company said Monday. The latest funding round valued the company at more than $860 million, a person familiar with the matter said. The growth funding round closed as investors grappled with the spreading fallout associated with the coronavirus pandemic.
Sheridan Holding Company I LLC, a Houston-based oil-and-gas investment fund backed by Warburg Pincus, has filed for chapter 11, and is proposing a speedy takeover by its creditors. The fund is seeking to turn itself over to creditors during its first appearance in bankruptcy court Tuesday, Soma Biswas reports for WSJ Pro. Sheridan Holding Company I is part of the Sheridan Group, an energy company established by Warburg in 2006. The fund’s restructuring proposal has unanimous backing from creditors that voted, said its Chief Executive Lisa Stewart in a court filing.
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Private equity delivered strong returns last year for the Healthcare of Ontario Pension Plan, providing a hedged return of 14%. The fund has 94.1 billion Canadian dollars (US$64.8 billion) under management. The fund’s private-equity investments produced a 13.7% return on a similar basis in 2018, the Toronto-based pension said Monday in its annual report. The asset class exceeded its performance benchmark by C$738 million last year.
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A public pension fund in San Francisco is calling on major corporations to lend their resources, manufacturing capabilities and distribution networks to help fight the coronavirus, and to report the actions they take, Heather Gillers reported for The Wall Street Journal, citing a statement from the fund. The $25 billion San Francisco Employees’ Retirement System asks S&P 500-listed companies to help produce protective gear and testing equipment and to repurpose hotels and other facilities to accommodate patients and health-care workers. The fund asks companies to report their actions using the hashtag #sp500covidfight.
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80%+
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The drop in demand for paid parking spaces since the onset of the coronavirus and related business and government-mandated shutdowns, according to the National Parking Association
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Workers at a warehouse in the U.K. city of Peterborough sort and pack orders. PHOTO: SIMON DAWSON/BLOOMBERG NEWS
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Blackstone Group is buying a collection of 22 warehouses across the U.K. from Clearbell Capital LLC for £120 million ($138 million), the seller said on its LinkedIn page, confirming an earlier report in the Financial Times. Clearbell didn’t provide details of its Cara portfolio or say when the deal is expected to close.
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Technology investor SoftBank Group said it would sell up to $41 billion in assets in order to buy back shares and redeem debt, an unprecedented move to combat its tumbling stock and bond prices, The Wall Street Journal reported. The plan—the biggest in the Japanese company’s history—would earmark as much as $18 billion for share buybacks, on top of a roughly $4.5 billion share repurchase plan announced just more than a week ago.
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Quad-C Management Inc., a middle-market private-equity firm based in Charlottesville, Va., has closed on an investment in Textum Weaving, a manufacturer of high-performance textiles based in Belmont, N.C. A family-owned business since its start in 1996, Textum will continue to be led by Chief Executive Aaron Feinberg, who will own a significant stake in the business.
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One Equity Partners has agreed to acquire digital technology consulting firm and reseller MCL Computer & Zubehör GmbH alongside company management. The Böblingen, Germany-based company operates with more than 160 employees from seven locations in Germany and Austria.
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Thoma Bravo expects to complete its roughly $2 billion take-private of Instructure Inc. on Tuesday, having received tenders for 64.4% of the Salt Lake City company’s shares by Friday. Thoma Bravo offered $49 a share for the maker of software used by schools and related service providers.
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Gryphon Investors is seeking $2.7 billion for Gryphon Partners VI LP and related parallel vehicles, according to regulatory filings. The new fundraising pitch comes less than a year after the San Francisco-based firm announced it had closed Gryphon Partners V LP at that fund’s $2.1 billion hard cap. Gryphon is also seeking $650 million for Gryphon Heritage Partners A LP and related parallel vehicles, another filing indicates.
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Oaktree Capital Management has raised at least $1 billion for its new Oaktree Latigo Investment Fund LP, a regulatory filing shows. The Los Angeles-based firm said the first and only commitment to the fund so far was received just last week.
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Parking garages and related facilities have attracted private equity interest as infrastructure investments in recent years but the coronavirus pandemic has revealed a risk associated with the operations. With government-mandated business shutdowns and tens of millions of Americans working from home, parking revenue has fallen sharply. The National Parking Association said over the weekend that fees have dropped more than 80% and is asking for a federal bailout.
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The British government is planning to buy equity stakes in airlines and other companies affected by the coronavirus pandemic, Reuters reported, citing the Financial Times. Carriers including IAG-owned British Airways would be asked to provide shares that can later be sold into the market in exchange for the cash infusions.
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PineBridge Investments is opening an office in Sweden and has hired Viggo Johansen from Natixis Investment Managers to head it up, Selin Bucak writes for Private Equity News, a U.K trade publication of Dow Jones & Co.
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A publicly traded Angelo Gordon-backed investment fund focused on mortgage securities is struggling to meet margin calls from lenders and is examining a possible asset sale, the latest sign of turmoil in crucial areas of the credit markets. In recent days, a cascade of selling has hit mortgage bonds, helping spark unprecedented action by the Federal Reserve on Monday morning to aid markets. The AG Mortgage Investment Trust Inc., a real-estate investment trust operated by the New York firm, is among those feeling pressure, Gregory Zuckerman and Ben Eisen report for The Wall Street Journal, citing the REIT.
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Brookfield Asset Management sought to reassure investors Monday by detailing its credit lines, liquidity and a distinct lack of success on the deals front in recent days. “We have no ‘hung purchases’,” the asset manager said in a letter to shareholders posted on its website. “Every contested deal we tried to do over the past five months, we lost.” But the firm credited that track record to discipline, as it didn’t buy overpriced assets. “In hindsight, this was good.”
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