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Restaurants Struggle With Shutdowns | Private-Equity Industry Presses for Access to Stimulus Loans
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Good morning. Amid the gloomy statistics and the human struggles caused by the coronavirus pandemic, it’s important to recognize that more people survive than succumb to the virus and its complications. By one running tally, the number of infections is likely to top 1 million world-wide sometime today, with nearly 47,000 reported deaths by late yesterday. But there were also roughly 194,000 cases reported in which the victims recovered.
It’s also important to remain cognizant of the millions of lives upended by fallout from the pandemic, and our William Louch and Laura Cooper provide a look at the plight of restaurant workers. Meanwhile, WSJ Pro's Luis Garcia has a perspective on how one firm is responding to the pandemic. And Chris Cumming reports on how the industry is pressing the federal government to let investment firms obtain stimulus loans.
We have these stories and more for you today, so please jump in...
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Elizabeth Mejia, right, with her family. She worked as a waitress at a restaurant in Los Angeles International Airport that closed indefinitely last month. PHOTO: ELIZABETH MEJIA
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The job prospects of millions of Americans hinge on whether their employers can ride out an economic shutdown that has reached nearly every corner of the country during the coronavirus pandemic, as WSJ Pro Private Equity’s William Louch and Laura Cooper report in a story that looks at the situation from the perspective of Elizabeth Mejia in Los Angeles. The private-equity-backed venue where she works closed indefinitely last month, leaving her in limbo, like many other workers in consumer-oriented businesses that have been shuttered in recent weeks.
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The private-equity industry is pressing the federal government to let investment firms obtain stimulus loans intended to blunt the economic damage stemming from the coronavirus, WSJ Pro's Chris Cumming reports. Present rules exclude borrowers when their owners hold in common independent operations with a total of more than 500 employees, in most cases. Industry lobbying groups are asking the Treasury Department and the Small Business Administration to loosen that restriction to make loans of up to $10 million available to portfolio companies from the $349 billion stimulus package passed last week.
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The coronavirus pandemic has affected nearly every industry in the U.S., including manufacturing, which in many ways remains essential to keeping the economy functioning. CORE Industrial Partners, a midmarket private-equity firm focused on manufacturing and industrial technology businesses, has seen the pandemic disrupt supply chains and slow sales in those areas, WSJ Pro's Luis Garcia reports. But the Chicago-based firm sees a chance for some of its portfolio companies to contribute to the fight against the virus, including 3-D printing businesses Midwest Composite Technologies Inc. and Fathom, according to CORE founder and Managing Partner
John May.
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18 Million
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Number of people forecast to lose jobs with small businesses that have been affected by fallout from the coronavirus pandemic, including 6.6 million already dismissed by March 21, according to the Kenan Institute for Private Enterprise at the University of North Carolina at Chapel Hill
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Carlyle Group Inc.'s headquarters is on Pennsylvania Avenue in Washington. PHOTO: SHAWN THEW/ SHUTTERSTOCK
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Nouryon Chemicals Holding BV, backed by Carlyle Group Inc. and Singapore sovereign fund GIC Pte. Ltd., has sold its Elotex redispersible polymer powders business to Celanese Corp. in Irving, Texas. The two investors acquired the specialty chemicals operations that they renamed Nouryon from Amsterdam-based Akzo Nobel NV in October 2018 in a deal that gave the business an enterprise value of €10.1 billion.
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Alleghany Capital Corp. has acquired a majority interest in Wilbert Funeral Services Inc., increasing its stake from 45%. Alleghany had held that minority stake since 2017. Overland Park, Kans.-based Wilbert provides products and services to funeral homes and cemeteries as well as to concrete manufacturers.
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Lower midmarket-focused private investment firm Five Points Capital has been acquired by funds-of-funds and secondary investor P10 Holdings Inc. in Dallas. The private asset manager said in January it intended to let Winston-Salem, N.C.-based Five Points operate as an independent unit under current leadership.
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Charlesbank Capital Partners has acquired a majority interest in World Insurance Associates LLC, investing alongside management and other employees. The Tinton Falls, N.J.-based company has grown mainly through acquisitions and now has 40 offices in 12 states. Charlesbank said its investment aims to help accelerate the pace of add-on deals by the company.
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Midmarket-focused HGGC has completed the acquisition of PCF Insurance, a brokerage with more than 400 employees that specializes in risk management and employee benefits for businesses. The Palo Alto, Calif.-based firm invested alongside management and previous backer BHMS Investments, which retains a minority stake in the Woodland Hills, Calif.-based company.
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Pine Island Capital Partners in Washington and Bain Capital Credit in Boston have acquired the Precinmac Family of Precision Machining Cos., a group of four manufacturers of precision machined components and assemblies for the aerospace, defense and semiconductor sectors. Compass Partners Capital also is investing alongside the two firms, who are buying the company from midmarket specialist GenX360 Capital Partners in New York.
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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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Consumer-focused L Catterton has sold Lily’s Kitchen, a U.K.-based natural pet food brand, to Nestlé Purina PetCare, Nestlé SA said in a news release. L Catterton initially backed Lily’s Kitchen in 2015.
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London-based Glennmont Partners has sold four operating solar farms in Portugal totaling 30 megawatts of capacity to local renewable power company Finerge, owned by Australian asset manager First State Investments, Elisângela Mendonça writes for Private Equity News, a U.K. trade publication of Dow Jones & Co.
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Flagship Pioneering, which launches health-care and sustainable startups, has raised $1.1 billion for its largest fund yet that is dedicated to financing startups, Brian Gormley reports for WSJ Pro Venture Capital. Flagship is expanding with this new fund into areas such as artificial intelligence and technologies to prevent diseases.
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Long Ridge, a growth-equity firm focused on business technology and financial technology, is seeking $375 million for Long Ridge Equity Partners III LP, according to a regulatory filing. The new fund’s offering amount exceeds the $227 million Long Ridge raised for its second fund in 2016. Monument Group is placing the fund, according to the filing.
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SDC Capital Partners, a New York-based firm focused on digital infrastructure, has raised at least $598 million so far for SDC Digital Infrastructure Opportunity Fund II LP, a regulatory filing indicates. SDC typically invests $20 million to $100 million at a time across subsectors that include data centers, fiber networks, wireless infrastructure and managed IT, according to the firm’s website.
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Searchlight Capital Partners has named distressed-debt specialist Andrew Crowston as a senior adviser. He joins the London-based firm from Novalpina Capital, where he was a partner working with the firm’s private-equity and special situations funds.
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Private-equity firm HGGC has hired Chris Heim as executive director and promoted Dan Stanko to partner from principal. Mr. Heim joins from HelpSystems, a portfolio company of the firm, where he was most recently executive chairman. Mr. Stanko joined the firm in 2018 from Bain Capital.
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A closed AMC theater in Santa Monica, Calif., in March. The chain shut all its theaters—more than 1,000 world-wide—in response to the coronavirus pandemic. PHOTO: RINGO CHIU/ZUMA PRESS
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Lenders for private equity-backed movie theater chain AMC Entertainment Holdings Inc. have hired restructuring lawyers, after the company shut down its cinemas due to the coronavirus pandemic, Alexander Gladstone and Erich Schwartzel report for WSJ Pro Bankruptcy, citing people familiar with the matter. AMC has been backed by Silver Lake since 2018.
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Publicly traded Brookfield Asset Management Inc. has completed a 3-for-2 stock split, giving shareholders of record on Feb. 28 one-and-a-half Class A shares for each Class A and Class B share held. The Toronto-based asset manager said its shares will open Thursday on a post-split basis. Brookfield has more than $540 billion of assets under management.
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Count the initial public offering market among the fallout from the coronavirus. Renaissance Capital said as many as 20 planned IPOs had to be shelved as the pandemic took hold early last month, souring an optimistic start to the year. Before the outbreak crashed the markets, 24 IPOs brought in $6.8 billion and the shares averaged 17% gains in the first two months of the year. But as the month waned, only third were showing gains and the average return fell to a 4% loss, the Greenwich, Conn.-based firm said.
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