Good morning and welcome!

I start us off this Tuesday with a report on the unpredictable forecast for how the Trump administration plans to get private equity into 401(k) accounts. The Labor Department and Supreme Court are getting set to take action, but it may not be enough to shake up the notoriously risk-shy retirement business.

Meanwhile, Colin Kellaher reports that Kohlberg & Co. inked a major exit of consulting and engineering company Entrust Solutions Group to a strategic buyer.

Now onto the news...

Private equity is in the dark about the details of the Trump administration’s plans to open Americans’ 401(k) accounts to alternative asset classes, reports Chris Cumming for Pro. Both the Labor Department and the Supreme Court are rethinking the question of who can sue their employer over high 401(k) fees, and the outcomes of their deliberations will have significant impact on whether private equity gets into retirement accounts. 

Kohlberg & Co. is selling utility consulting and engineering services provider Entrust Solutions Group to strategic buyer Leidos for about $2.4 billion in cash, Colin Kellaher reports for The Wall Street Journal. Entrust, which has more than 3,100 employees in more than 40 locations across North America, serves the utility and infrastructure end markets. Kohlberg, in Mount Kisco, N.Y., acquired Entrust in 2019 and sold a minority stake to Neuberger Berman in 2023.

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Bessemer Venture Partners is leading a $250 million investment in Upwind Security in a deal that brings the company’s valuation to around $1.5 billion, Angus Loten writes for WSJ Pro. The transaction also drew support from return backers including Greylock Partners. Salesforce Ventures and Picture Capital joined as first-time investors.

Blackstone is acquiring electrical products manufacturer Arlington Industries from the Stark family, which has controlled the business since acquiring it in 1956. The Scranton, Pa.-based company makes fittings, enclosures and other parts used by electricians in assemblies and building construction. Blackstone in New York is investing through its ​​Energy Transition strategy.

Bridgepoint Group and Triton Partners in London have held preliminary discussions with Spire Healthcare Group in relation to its strategic review, announced last year, according to a regulatory filing. The London-listed company said it had also held discussions with other groups that it didn't name. Shares of the company jumped nearly 18% to close at 210 pence Monday, giving the business a market value of about £845.8 million, or roughly $1.2 billion.

Africa-focused growth firm Adenia Partners has backed its first majority investment in Egypt with the acquisition of Cairo-based Parkville Pharmaceuticals from fellow Africa-focused private-equity firm Admaius Capital Partners. 

Sound Point Capital Management has agreed to buy up to $720 million of point-of-sale debt sourced through New York-based Pagaya Technologies under a forward-flow purchase deal. Sound Point regards the debt as "short-duration assets with highly attractive risk-adjusted returns," according to Philip Bartow, a firm portfolio manager and its head of specialty finance and fintech lending. The New York firm manages over $45 billion.

Middle-market buyout firm JLL Partners has bought PowerParts Group, a provider of replacement parts and field services for gas and steam power turbines that operates through two main subsidiaries: STAR Turbine and Thor Precision. JLL acquired the company from Tampa, Fla.-based firm Mangrove Equity Partners.

Internet business investor DST Global and Lightspeed Venture Partners led a $300 million growth investment in Ricursive Intelligence in a deal that values the company at $4 billion, joined by other startup investors including Sequoia Capital. The company is developing a system used to close the recursive feedback loop between artificial-intelligence models, a major bottleneck slowing AI-dedicated chip design.

Special situations-focused KPS Capital Partners has agreed to acquire a controlling stake in Chargeurs Films de Protection, or Novacel, from its parent Compagnie Chargeurs Invest, which will retain a 25% stake alongside KPS. Deville, France-based Novacel manufactures surface protection products, including process and protection films, tapes, papers and specialty machines, for end markets that include building exterior, building interior and equipment, industrial, appliances and transportation.

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

Neos Partners-backed electrical equipment maker Forgent Power Solutions plans to sell nearly 16.6 million shares priced at $25 to $29 each in an initial public offering that could push its equity value past $8.8 billion, Colin Kellaher reports for the Journal. Neos, based in San Diego, plans to sell about 39.4 million shares in the offering, but will still hold about 80% of the company’s voting power after the IPO. Neos formed Forgent from its holdings in 2023, according to the firm.

Bain Capital-backed retailer Bob's Discount Furniture plans to sell nearly 19.5 million shares priced from $17 to $19 each in an initial public offering that could give the furniture retailer an initial market capitalization approaching $2.5 billion, Colin Kellaher reports for Dow Jones Newswires. Boston-based Bain Capital, which acquired Bob's in 2014, will still own around 73% of the Manchester, Conn.-based company's equity after the IPO, assuming underwriters exercise all their options.

Accel-backed insurance-services provider Ethos Technologies in San Francisco has detailed its plans for an initial public offering, saying it will sell about 10.5 million Class A shares priced at $18 to $20 each, in a securities filing. Accel holds about 21% of the equity voting power in the company while Sequoia Capital holds almost 36%, figures that aren't expected to change in the IPO. Google Ventures, SoftBank Group and General Catalyst are also invested in the company, which sells life insurance through a smartphone app. Accel and Sequoia were among the insure-tech's earliest investors with commitments in 2018.

Investment firm AE Industrial Partners' portfolio company York Space Systems is expected to hold its initial public offering of 16 million shares this week to raise as much as $544 million, market watcher Renaissance Capital said. The Greenwood Village, Colo.-based company expects to price the shares at $30 to $34 each. AE Industrial, which held 100% of the company's equity as of Jan. 16, expects its stake to fall to just under 24% following the IPO, while BlackRock is expected to enter the picture with a nearly 14% stake.

Consumer sector-focused firm Brynwood Partners has sold branded and private-label products business Great Kitchens Food to family-owned Rich Products. Brynwood backed the formation of Great Kitchens in 2020 to acquire pizza brand Aryzta in a corporate carveout deal. Brynwood funded the transaction out of Brynwood Partners VIII, which closed in 2018 with $649 million.

Leonard Green has closed its first secondary offering with more than $3.6 billion in commitments, including related parallel investment entities. The final tally for Sage Equity Investors exceeded a $1.5 billion goal and included capital from Leonard Green executives. Other investors that have disclosed commitments to the fund include Teacher Retirement System of Texas and New York City Fire Department Pension Fund. Leonard Green’s new secondary fund primarily targets investments in general partner-led deals involving single assets. The strategy has already begun investing capital and in 2024 served as the lead investor in a continuation fund formed to recapitalize PlayCore Group, a playground equipment company backed by midmarket firm Court Square Capital Partners.

New State Capital Partners has hired Sanjay Gupta as a senior principal to lead its newly set up noncontrol investment strategy, Forge Select. The lower midmarket investor in New Rochelle, N.Y., also added John McGonigle as a vice president with Forge. Gupta joins from Moonfare while McGonigle comes from Gatewood Capital Partners.

Berkshire Partners in Boston has hired Richard Liechtenstein in the newly created role of operating partner and head of data science and AI at the firm. Lichtenstein joins from consultant Bain & Co., where he was senior expert partner and chief data officer for private equity. As part of its expanded investment in artificial intelligence and machine learning, Berkshire has also promoted Limor Gultchin to director from vice president of AI/ML.

Family office investor Pritzker Alternative Strategies has named Joseph Kusnan as a senior adviser to the firm, which backs passive investments with lower and middle-market private-equity funds and related co-investment opportunities, according to an emailed statement. Kusnan most recently led private investments for the Pegula family, owners of the Buffalo Bills pro football and Buffalo Sabres pro hockey teams.

Gallant Capital Partners has hired Josh Carter as a managing director to lead technology investments at the Los Angeles-based firm. Carter joins from Harvest Partners, where he led software investments as a partner. Gallant also recently made senior promotions, including moving up Jamie Kim to managing director and head of business development, Matt Pareti to managing director on the operations team and Dan Johnson to principal.

Amsterdam-listed CVC Capital Partners is acquiring Blackstone-backed credit manager Marathon Asset Management for up to $1.2 billion in cash and stock, Dominic Chopping reports for the Journal. The deal will increase CVC's credit assets to about €61 billion, or roughly $72.42 billion. Marathon managed about $23.07 billion on a discretionary basis at the end of 2024, according to the New York firm's latest annual report to the Securities and Exchange Commission. CVC is paying $400 million in cash and the balance in shares, and includes $400 million in earnouts payable in equal portions of cash and equity. Blackstone acquired a minority stake in Marathon in 2016. CVC shares fell almost 2.4% to close at €14.82 Monday.

Canadian pension investor Caisse de dépôt et placement du Québec plans to sell a block of shares in Toronto-listed broadband services provider Cogeco Communications to generate expected proceeds of around 229 million Canadian dollars, or about $167 million. La Caise, as the investor is also known, has backed the provider of landline and wireless telephone services since 2013 and will remain the largest holder of its subordinate shares after the sale. The block trade represents a nearly 11% stake in the company's subordinate shares, with the gross price per share of C$67.45.

A majority of institutional investors say increased scrutiny of retail capital in private markets will increase compliance costs and reduce efficiency, Xhulio Ismalaj reports for sister publication Financial News in London, citing Coller Capital’s latest global private capital survey. The findings come as private assets increasingly make their way into the hands of wealthy clients through vehicles such as evergreen and long-term-asset funds.

Shares of publicly traded business development company BlackRock TCP Capital Holdings dropped about 14% to a record low of $5.06 following an announcement on Friday of loan losses, the Journal reports. The BDC’s bonds sank about 3% to 99 cents on the dollar, close to the low they hit during the broad market downturn triggered by the announcement of U.S. tariffs last April.

Athvance Capital, formed by ex-JPMorgan Chase banker Karim Ben Rejeb and former Eurosport executive Danny Menken, is pursuing deals in more niche corners of the sports market across Europe, Sebastian McCarthy reports for sister publication Private Equity News in London. The firm's strategy targets "emerging and under-commercialised sports IP" as well as technology and related services providers with investment such as backing a beach volleyball league and a padel tournament.

Serial SPAC issuers raised $4.9 billion through initial public offerings of the blank-check vehicles, comprising almost half of all the new special purpose acquisition companies that went public in last year's fourth quarter, advisory firm ICR reports. According to market watcher SPAC Research, there were 144 IPOs last year, while 90 are pending and seeking $12.2 billion as this year's first month nears its end, while 14 have deals already closed.

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