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Advent Forms European Fintech Platform | PE-Backed Thrasio Prepares for Bankruptcy Filing
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It’s Friday! Some of you here in the U.S. may already be thinking about next week’s Thanksgiving gatherings! If there are any others out there trying to figure out what to cook for vegan relatives, I feel your pain!
In this morning’s newsletter we have two stories involving global private-equity investor Advent International. First, Maria Armental looks at a new payments and financial technology platform that the firm has launched over in Europe. Meanwhile, our WSJ Pro Bankruptcy colleagues report about a company that Advent backed alongside fellow private-equity firm Silver Lake called Thrasio, which is preparing to file for bankruptcy.
Read on for more details on these stories and many more…
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Veteran financial technology executive Laurent Le Moal has joined AI Circle Bidco, a new fintech platform launched by Advent International, as the company’s chairman. PHOTO: ORE HUIYING/BLOOMBERG NEWS
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Advent International is acquiring U.K. financial technology firm myPOS and has set up a dedicated European platform focused on small and micro merchants, Maria Armental reports for WSJ Pro Private Equity. The Boston-based firm established AI Circle Bidco Ltd., a payments and technology platform, to serve small businesses in Europe, a group that traditionally accounts for a large share of jobs and economic output but that tends to have a tougher time accessing capital. Laurent Le Moal, a former chief executive of Naspers-owned fintech company PayU and former PayPal vice president, is Circle’s chairman.
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Advent International- and Silver Lake-backed Thrasio, a startup that bought dozens of consumer brands sold on Amazon.com’s website, is preparing to file for bankruptcy as it contends with a postpandemic slump in online spending, Soma Biswas and Alexander Gladstone report for WSJ Pro Bankruptcy, citing people familiar with the matter. In 2021, Thrasio said outside backers including Advent and Silver Lake had invested $3.4 billion in the business, and its valuation rose to as much as nearly $10 billion. But online sellers like Thrasio, known as Amazon aggregators, have been pressured as shoppers have curtailed their purchases since the height of the Covid-19
pandemic.
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$1.077 Trillion
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The face value of leveraged loans issued in the U.S. this year through Thursday, more than triple the amount issued during the same period of last year, according to data provider Refinitiv
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A cerulean-green Aston Martin car speeds down the track during an F1 race in Sao Paulo earlier this month. PHOTO: HASAN BRATIC/ZUMA PRESS
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Sports specialist Arctos Partners in Dallas is backing AMR Holdings GP, the owner of the Aston Martin Aramco Cognizant Formula One auto-racing team, to support its growth, according to a news release. The deal comes as the team is preparing for the first F1 road race to be held in downtown Las Vegas. The Silverstone, England-based team is affiliated with luxury sports car maker Aston Martin Lagonda.
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Seattle-based lower midmarket firm Rainier Partners said it has backed Omega Fitness, a franchisee of Anytime Fitness gyms created by the combination of two businesses built by franchise operators Andy Gundlach and Russ Allen. Omega, which has nearly 70 gyms in Wisconsin, California and Florida, will be led by Allen and Gundlach.
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Buyout firm GTCR in Chicago is buying the Cloudbreak Health patient translation services business of medical-services company UpHealth in Delray Beach, Fla., for $180 million through a carve-out transaction, according to the seller. Columbus, Ohio-based Cloudbreak provides real-time interpretation services for patients and care providers in hospitals, clinics and other settings through custom devices that include smartphones and tablets, with speakers of more than 250 languages working through its digital systems, according to a news release. The deal is expected to close next year.
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Recently established private-equity firm Panther Equity Group and specialist investor Corbel Capital Partners, both in Los Angeles, said they are backing custom software developer Switchbox with a growth investment. The Columbus, Ohio-based company works with customers in a variety of industries to create software to address specific operational issues. Former investment banker and corporate chief executive David Eshaghian set up Panther in 2021.
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Technology-focused firm Thoma Bravo has agreed to offer €40 per share to take-private EQS Group, a Munich-based provider of investor relations, compliance and sustainability reporting services. The offer values the company’s equity at roughly €400 million, or $434.8 million. The price represents a 53% premium to Wednesday's closing at €26.20 each in Frankfurt. Thoma Bravo said it has already secured commitments to the deal from holders of about 60% of the shares. In August, the company reported a 16% gain in first-half revenue to €33.7 million while adjusted pre-tax earnings more than doubled to about €3.5 million. Thoma Bravo said the deal is also its first investment in Germany.
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Canadian pension Caisse de dépôt et placement du Québec, or CDPQ, said it is investing around 200 million Canadian dollars, equivalent to around $145.5 million in convertible debt in Northvolt, a Swedish company focused on the development, manufacturing and recycling of sustainable battery cells and systems. Northvolt plans to use the capital to support the construction of a battery factory just outside of Montreal, Quebec.
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Philadelphia-based Hidden River Strategic Capital said it has backed the second deal out of its debut fund with an investment in Realty Landscaping, a commercial landscaping and exterior services provider. The firm is backing the company in partnership with Philadelphia-based private investment firm Hullson Partners. Hidden River closed its inaugural fund with $245 million in June.
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Kingswood Capital Management said it and brand investor First Bev, both based in Los Angeles, are backing energy drinks company G Fuel with “a significant cash investment” to provide growth capital for the business, which focuses its marketing on digital games players. The Hauppauge, N.Y.-based company also got a new chief executive in conjunction with the deal as beverage industry veteran Bryan Crowley joined to lead the business, according to a news release.
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Boston wealth advisory firm Edelman Financial Engines, which oversees $245 billion of client assets, has acquired PRW Wealth Management, according to a statement. The acquisition of the Quincy, Mass.-based business adds more than $500 million of assets and 200 individual and institutional clients to EFE’s roster. It also marks the fifth add-on acquisition made by the company in the space of 13 months. EFE is majority owned by Hellman & Friedman with Warburg Pincus acquiring a minority stake in 2021.
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Financial services and investment company Shandong Hi-Speed Holdings Group in Hong Kong is investing $299 million in publicly traded Vnet Group, which operates data centers in more than 30 cities in China. Shandong is investing through two entities it owns, Success Flow International Investment and Choice Faith Group Holdings, which are both buying newly issued class A common shares priced at the equivalent of about $2.76 per American depositary share, according to a news release. Vnet described the deal as a strategic investment. The company's shares fell as much as 23% in New York.
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Money manager GQG Partners in Fort Lauderdale, Fla. and investment firm River Capital in Australia had conditioned their proposed offer to acquire Pacific Current Group for 11 Australian dollars per share on the support of a key shareholder and didn’t get it, so the company said it hasn’t received an offer that it could accept and is ending its strategic review Shares of Pacific fell 9.2% Thursday in Sydney.
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Macquarie Group’s asset-management arm said it is backing sustainable aviation fuel company SkyNRG with a growth investment of as much as €175 million, equivalent to about $189.9 million. The Australian firm is investing through its Macquarie GIG Energy Transition Solutions fund.
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Stride Consumer Partners is taking a minority stake in Odele, a European clean hair-care product brand that was founded in 2020. Odele co-founders Lindsay Holden, Britta Chatterjee and Shannon Kearney will remain majority shareholders of the company.
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Brookfield in Toronto has acquired Bermuda-based specialty property and casualty insurer Argo Group International through an all-cash transaction valued at about $1.1 billion, resulting in a delisting of the carrier’s shares in New York, according to a news release. Toronto-based Brookfield agreed to take Argo private in February for $30 a share, investing through its reinsurance affiliate. Previous sales of Argo operations significantly reduced its earnings, as the company recently reported a nearly 30% drop in gross written premiums and a 25% decline in earned premiums for the third quarter, leading to an operating loss of $21.1 million, or 60 cents a share for the period.
Brookfield said earlier this month that Argo and annuities provider American Equity Investment Life Holding, which reported holding about $44.6 billion in invested assets, would increase the capital held by its Brookfield Asset Management arm by $55 billion.
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First Citizens Bank said that its asset-based lending group has provided a credit facility to The Stepping Stones Group, a behavioral healthcare and autism services treatment provider backed by Leonard Green & Co.
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Technology-focused midmarket private equity firm BV Investment Partners announced an investment in CallTower, a South Jordan, Utah-based cloud communications company that can be used across platforms that include Microsoft Teams, Zoom, Cisco Webex, Five9.
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Seaside Equity Partners in San Diego said it is backing emergency property restoration company Frontier Services Group through an unspecified investment. The Houston-based company provides clean up, damage mitigation and other services to real estate owners in Texas and across the Gulf Coast.
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Kore Capital and Whitebox Advisors are supplying about $40 million in term loans to publicly traded private aviation company Wheels Up Experience, joining Delta Air Lines, Certares Management, Knighthead Capital Management and Cox Enterprises as backers of the company. Lenders have extended credit totaling about $490 million and have received shares equal to about 95% of the company’s equity in exchange, according to a news release.
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Editor’s Note: Each week, we will share selections from WSJ Pro that provide insight and analysis we hope are useful to you. The stories are unlocked for The Wall Street Journal’s subscribers.
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Walgreens wants the corner drugstore to become an online delivery hub.
A California law to collect diversity data from venture funds could potentially apply to a wider pool of assets and asset managers.
EY picks Janet Truncale as its global chair as the accounting firm looks to put its failed split behind.
🎧 Listen to Laura Deming of Longevity Fund discuss futuristic solutions to aging.
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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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Silver Lake and Partners Group Holding in Switzerland have agreed to sell a $50 million stake in publicly traded Global Blue Group Holding to China’s Tencent Mobility, which is also buying a roughly equal number of shares from Global Blue, giving the buyer a roughly 8% interest in the business, according to a regulatory filing. Members of Global Blue management are also among the sellers. The $100 million sale involves about 18.2 million shares priced at $5.50 each. Global Blue said the proceeds from its half of the sale, or about $50 million, will be used to reduce debt. The Swiss company pioneered tax-free retailing at airports and other locations and
also offers payment services. Silver Lake acquired Global Blue alongside Partners in 2012 and took the company public through a combination with a blank check company in 2020.
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Carlyle Group has lowered its fundraising target for a new Asia-focused pool by at least 30% to as much as $6 billion from a previous $8.5 billion goal, Reuters reported, citing three people with knowledge of the matter. The Washington-based firm has encountered reluctance stemming from a global economic slowdown and rising geopolitical tensions, the news agency said. So far, Carlyle has collected less than $3 billion for the vehicle, which has been in the market since the middle of last year, two of the people said.
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TPG has rounded up at least $10.74 billion so far for its latest flagship fund, TPG Partners IX LP and related parallel funds, according to a regulatory filing. A separate regulatory filing indicates that TPG has also garnered at least $2.47 billion so far for its second healthcare-focused fund, TPG Healthcare Partners II LP. The amount raised for the healthcare fund so far puts the fund more than two thirds of the way toward a $3.5 billion goal that the firm initially told investors it was seeking for the fund last year. During its third quarter earnings call, TPG Chief Financial Officer Jack Weingart said that the firm expects to close TPG Partners IX and TPG Healthcare Partners II LP late this year.
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Peak Rock Capital is seeking $2 billion for Peak Rock Capital Fund IV LP, a regulatory filing indicates. The new fund’s offering amount would put the fund at roughly the same size as its predecessor, which closed with $2 billion in 2021 ahead of a $1.3 billion target.
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A number of U.S. investment firms have joined the massive reconstruction effort in Ukraine that has already garnered the support of foreign multinational companies and financial giants such as BlackRock Inc., James Rogers reports for sister publication MarketWatch, citing Sergiy Tsivkach, CEO of UkraineInvest, the Ukrainian government’s investment-promotion office. Speaking during a Wednesday press conference at the ReBuild Ukraine conference in Warsaw, Tsivkach noted that the aim of the Ukraine Development Fund — launched with BlackRock — is to mobilize private investments. The fund has an initial focus on five sectors of the Ukrainian economy: energy,
infrastructure, agriculture, manufacturing and IT.
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Azimut Alternative Capital Partners, a New York-based private markets subsidiary of Azimut, said in an emailed statement that it has added two senior professionals to its team that invests in the stakes of general partners management companies. Michael Shedosky and Brian Farrell join the firm from Morgan Stanley, where they led the bank’s GP capital solutions team. They will report to Jeffry Brown, chief executive and co-chief investment officer of Azimut Alternative Capital Partners.
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Impact investor Vistria Group in Chicago said it has opened a New York office with executives including Margaret Anadu, a senior partner, and Mona Sutphen, a partner. Anadu leads real estate strategies for the firm while Sutphen is head of investment strategies, according to a news release.
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Technology-enabled services focused RLH Equity Partners in Los Angeles said it has expanded Rob Rodin’s leadership duties to become the firm’s chief executive, succeeding co-founder and Chair Chris Lewis, who remains active with the board of directors. The firm is also known as Riordan, Lewis & Haden, which Lewis helped establish in 1982, according to a September regulatory filing, which said the firm managed about $898.8 million at the end of June. Rodin, who became a strategic adviser to the firm in 2007, has been a managing director since 2016 and became vice chairman in 2021, according to a news release.
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Permira said it has named Amol Kulkarni as a senior advisor to its global technology team with a focus on generative artificial intelligence. Kulkarni most recently served as chief product and engineering officer at cybersecurity technology company CrowdStrike.
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New State Capital Partners said it has added Will Swayne as a senior principal at the firm. Swayne previously served as a managing director at Partners Group, where he focused on deals in the professional services sector.
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Multi-boutique asset manager Vitrus Investment Partners said Andra Purkalitis has joined the firm as executive vice president, chief legal officer, general counsel, and corporate secretary. Purkalitis most recently served as global chief compliance officer and regulatory counsel at private real estate firm Affinius Capital.
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GPB Capital’s GPB Holdings II fund, one of the firm’s largest investment partnerships, reported assets of about $564.9 million at the end of September, down about 6.2% for the year to that point. Separately, the New York firm’s Automotive Portfolio, which sold the bulk of its investments in late 2021, said it recently finalized the sale of a Subaru dealership in New Hampshire that delivered about $35.1 million to the partnership, in addition to what was received from the earlier sales. GPB faces civil fraud
charges from the Securities and Exchange Commission in federal court while two men who started it face criminal fraud charges, which they have denied, and the firm is operating under the guidance of a court-appointed monitor. GPB collected around $1.7 billion from some 17,000 investors, many of them retirees, over a five-year period in which it pitched funds that it said would deliver dividends of at least 8% to investors.
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John Paulson made a fortune on Wall Street betting the housing market would collapse. His reinvention as a property tycoon opening Puerto Rico to the wealthy is proving trickier, as The Wall Street Journal’s Caitlyn McCabe writes. The 67-year-old has spent hundreds of millions of dollars over a decade buying and developing luxury resorts, condos and high-rise offices in the U.S. territory. The island’s government has introduced tax breaks to attract rich home buyers and businesses, and Paulson has said the opportunity is akin to Miami before its epic boom in the 1980s. This is a significant wager for Paulson, who has a mixed investment record since the financial crisis.
But any progress has been overshadowed lately by a split with a business partner who recently served as Paulson’s point man in Puerto Rico, Pakistan-born Fahad Ghaffar.
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Insurer MetLife said it has completed the transfer of $19 billion of life insurance policies to KKR & Co.’s Global Atlantic Financial Group, which the firm acquired in early 2021, adding about $90 billion to KKR's assets under management. The risk-transfer transaction that closed Thursday, MetLife handed over retail policies as well as fixed annuity reserves but remains the administrator on the policies, according to a regulatory filing. The transfer was agreed to in May.
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Lending and financial services giant JPMorgan Chase’s private banking unit said it has set up an operation to cater to private equity and venture capital firms and their leaders, rolling into it the more than 10,000 client accounts it acquired when it took over failed First Republic Bank in May. The San Francisco-based bank had been a significant player in financing VC firms and their principals before it collapsed following the failure of Silicon Valley Bank earlier this year.
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Federal Trade Commission Chair Lina Khan singled out private equity’s role in the U.S. healthcare system in a podcast produced by Bloomberg News, citing the high cost of care for Americans and deteriorating outcomes, Chris Matthews reports for sister publication MarketWatch. Khan pointed to a recent study that showed a correlation between private-equity interest in nursing homes and higher mortality rates at the facilities backed by the firms. “This is not just about pricing. It can really be life or death,” Khan said. “We’ve been hearing from…healthcare workers about the way in which private equity’s incursion can result in detrimental outcomes.”
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