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Apollo's Black to Step Back | GA Bets on Equality Health | Intersect Raises Over $600 Million | Sunstone Reinvents ServiceNow Bet
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Good day Pro PE readers! The week is starting out to be a busy one, with a slew of SPAC news that came out yesterday, primarily involving reverse mergers with private-equity-backed companies. Perhaps the biggest story of the day, however, was news that Apollo Global Management Chief Executive Leon Black would step back from his role later this year, following an independent inquiry conducted by Dechert LLP into Mr. Black’s relationship with disgraced financier Jeffrey Epstein. The investigation deemed that the fees were justified and found no links to any of the criminal activities of the late Epstein, as Miriam Gottfried writes for The Wall Street Journal. Also in this morning’s newsletter, we have deal news from firms including General Atlantic, Trilantic North
America and Sunstone Partners.
Dive in for more details...
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Apollo Global Management CEO Leon Black had asked a committee of the firm’s independent directors to review his relationship with the late Jeffrey Epstein. PHOTO: PATRICK T. FALLON/BLOOMBERG NEWS
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Leon Black plans to step down as chief executive of Apollo Global Management Inc. after an independent review revealed larger-than-expected payments to disgraced financier Jeffrey Epstein that it nevertheless deemed justified. Mr. Black wrote in a letter to Apollo’s fund investors that he will cede the role of CEO to co-founder Marc Rowan on or before his 70th birthday on July 31 while retaining the role of chairman.
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General Atlantic is extending a string of investments in companies that follow the value-based health-care model, backing largely Medicaid-focused Equality Health LLC, WSJ Pro Private Equity’s Laura Cooper reports. The Phoenix-based business is a provider of technology, services and support for value-based—or outcome-oriented—care networks covering people with Medicaid, Medicare and Affordable Care Act health plans. Endeavour Capital, which initially invested in the company in 2016, remains a minority shareholder.
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Meanwhile, an investment venture between General Atlantic and credit veteran Tripp Smith is teaming up with minority shareholders of Garrett Motion Inc. to propose an alternate restructuring of the bankrupt auto supplier, challenging its planned deal with its majority owners, Soma Biswas reports.
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Clean-energy company Intersect Power LLC is receiving more than $600 million in equity and debt financing from private investment firms that include Trilantic North America and Generate Capital, Luis Garcia reports for WSJ Pro Private Equity. The financing includes $127 million of equity and $482 million of debt.
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Sunstone Partners, a lower midmarket private-equity firm focused on tech-enabled services companies, is backing the formation of a new portfolio company catering to companies that use the ServiceNow enterprise software platform, Laura Kreutzer writes for WSJ Pro Private Equity. The latest deal marks the second time that Sunstone’s investment team has backed a portfolio company centered around ServiceNow’s software.
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$61.8 Billion
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Estimated total volume of secondary deals in the year ended Dec. 31, down more than 27% from the prior year, according to a report by intermediary Setter Capital. Although traditional fund secondary deal volume fell by nearly 48% in 2020, deals involving direct secondaries rose by nearly 11% over the same period, according to the report.
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A 2017 photo of the Cambridge offices of Jagex. Carlyle Group has acquired the U.K. publisher of online role playing game RuneScape. PHOTO: CHRIS RATCLIFFE/BLOOMBERG NEWS
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Carlyle Group Inc. has purchased videogame company Jagex Ltd., the U.K. publisher of the online role-playing game RuneScape, which has attracted players who have opened nearly 300 million accounts since it went live about 20 years ago, Stephen Nakrosis reports for Dow Jones Newswires. The Cambridge, England-based company has more than 450 employees developing games for computers and mobile devices.
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First Solar Inc. on Monday said it agreed to sell a roughly 10-gigawatt U.S. utility-scale solar project platform to a portfolio company backed by the infrastructure unit for Canadian pension fund Ontario Municipal Employees Retirement System, or Omers, for about $261 million, Colin Kellaher writes for Dow Jones Newswires. First Solar, a Tempe, Ariz., maker of photovoltaic solar-power systems, said the platform includes the Rabbitbrush, Madison, Oak Trail, Horizon and Ridgely projects that are expected to commence construction in the next two years, as well as the 30-megawatt Barilla Solar project, which is operational.
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Growth-equity firm JMI Equity has made a $60 million investment into telehealth provider TimelyMD, a telemedicine and teletherapy provider for for colleges and universities. TimelyMD has telehealth providers in all 50 states and serves as an around the clock extension of student health and counseling services on more than 80 college campuses, according to a news release. The company now serves more than 10 times as many students as it did in early 2020, the release stated.
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Health-care-focused Grant Avenue Capital LLC has acquired a majority interest in Valeo Home Health and Hospice.Grant Avenue is purchasing the company from Eduro Healthcare, an owner and operator of skilled nursing facilities. It marks Grant Avenue’s fourth corporate carve-out since its launch in 2019. Alongside the acquisition of Valeo, the firm has kicked off a broader initiative to buy companies and strike partnerships in the home-based care sector.
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Iconiq Growth led a $530 million financing round for Finnish food-delivery platform Wolt Enterprises Oy, investing alongside Tiger Global Management, DST, KKR & Co., Prosus and Coatue. The firms joined Sweden’s EQT AB in backing the company, Dominic Chopping reports for Dow Jones Newswires. Stockholm-based EQT initially backed the company through its EQT Ventures I fund in 2016. Other existing investors also participated, including 83North, Highland Europe, Goldman Sachs Growth Equity and Vintage Investment Partners. The Helsinki-Based company works with more than 30,000 restaurants and retail
partners and 60,000 couriers in 129 cities across 23 countries.
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Flexpoint Ford is offering to acquire financial advisory firm AFH Financial Group PLC for 463 pence per share, or about £224.5 million (equivalent to about $307.2 million), Ian Walker reports for Dow Jones Newswires. The bid represents a 16% premium to the company’s closing share price of 397.50 pence on Friday. AFH Financial said its management is backing the take-private offer.
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Newlight Partners is investing as much as $200 million in newly formed specialty property and casualty insurance company Upland Capital Group, backing the Dallas-based business alongside members of management. The insurer is initially focusing on offering excess casualty coverage through wholesale brokers.
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Praesidian Capital said it has acquired a controlling interest in Round2, a South Bend, Ind.-based producer of collectibles such as die cast cars, model kits and other hobby products. The deal marks the second platform deal that Praesidian made under a recently launched private-equity strategy.
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Sycamore Partners plans to add a fourth ship to the three it is acquiring from Royal Caribbean Cruises Ltd. for about $201 million. The still unnamed ship will be comparable in size to the three Azamara vessels it is acquiring, and will be brought on line once a refitting is completed, expected next year, Sycamore said Monday.
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NexPhase Capital has agreed to invest in Oliver Wine Co, Inc., a Bloomington, Ind.-based winery that sold more than 700,000 cases of its wines in 2020.
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ADM Capital Europe is investing in U.K. manufacturer Aquapak Polymers Ltd., backing the company through its Cibus Enterprise Fund, according to an emailed news release. Aquapak makes a biodegradable, nontoxic and water-soluble polymer used in bags for clothing and waste and is developing rigid packaging for foods and home-delivery uses.
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Bain Capital is backing outpatient rehabilitative services provider MS-HC LLC, which does business as Multi-Specialty HealthCare, investing in the Baltimore-based business through its Double Impact strategy, according to an emailed news release. The company runs more than 30 post-traumatic injury care and physical rehabilitation centers throughout the Baltimore-Washington metropolitan area and Delaware-Maryland-Virginia peninsula region.
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Granite Creek Capital Partners has invested in Life Spine Inc., a medical device company focused on spinal implant products for orthopedic surgeons and neurosurgeons. The investment was made from Granite Creek’s $200 million FlexCap II fund, according to an emailed news release. The firm’s managing partner Mark Radzik will join the company’s board of directors as a result of the deal.
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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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Blackstone Group Inc. has agreed to sell its Alight Solutions portfolio company to a blank-check company founded and led by investor Bill Foley in a deal that would give the newly public company an enterprise value of about $7.3 billion, Michael Dabaie reports for Dow Jones Newswires. Foley Trasimene Acquisition Corp., the special purpose acquisition company, raised more than $1.03 billion in an earlier initial public offering of shares, plus $300 million in a forward purchase agreement from Cannae Holdings and Thomas H. Lee Partners and will combine those funds with a $1.55 billion private placement to finance the deal, regulatory filings show. Alight provides employee benefits services covering more than 30 million people for its client companies. Blackstone initially backed the Lincolnshire, Ill.-based company for $4.3 billion in cash and potential follow-on performance-linked payments of $500 million from Aon PLC in 2017.
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Momentus Inc., a commercial space company that is being acquired by blank-check company Stable Road Acquisition Corp., has named Dawn Harms its interim chief executive following the resignation of its founding CEO, Mikhail Kokorich, who ran into security clearance issues because of his citizenship, Matt Grossman reports for Dow Jones Newswires. Santa Clara, Calif.-based Momentus is working on technology to deliver and service orbiting satellites. But U.S. rules about sensitive technology prevented Mr. Kokorich, a Russian citizen seeking asylum in the U.S., wasn’t allowed to see some of Momentus's technical information even as its leader, the company said
in a regulatory filing. Ms. Harms is a former Boeing Co. satellite executive who has been serving as Momentus’s chief revenue officer.
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Latch Inc., a venture capital-backed maker of smart locks and building-management software, plans to go public by merging with a special-purpose acquisition company backed by a real-estate giant Tishman Speyer Properties LP, the latest startup looking to use a so-called blank-check vehicle to cash in on strong investor interest in tech-enabled businesses, The Wall Street Journal reported.
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Blank-check company Landcadia Holdings III Inc. has agreed to take Hillman Group Inc. public, in a reverse merger deal that implies a $2.64 billion enterprise value for the company, Chris Wack writes for Dow Jones Newswires. CCMP Capital Advisors, which acquired Hillman in 2014, will remain the largest shareholder.
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A blank-check company backed by Apollo Global Management Inc. has agreed to take residential solar power company Sunlight Financial LLC public through a reverse merger in a deal that values the company at about $1.3 billion, Dave Sebastian reports for Dow Jones Newswires. After combining with the blank-check company, Spartan Acquisition Corp. II, Sunlight, which provides financing for solar panel installations for homeowners and is backed by investors that include Tiger Infrastructure Partners and FTV Capital, will be known as Sunlight Financial Holdings Inc.
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OpenGate Capital said that portfolio company SMAC, a French manufacturer of waterproofing and building envelope products, is selling its skylights division to a unit of publicly traded Kingspan Group PLC. OpenGate initially backed SMAC in 2019.
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Sentinel Capital Partners has agreed to sell Pet Supplies Plus to publicly traded Franchise Group Inc. in a deal valued at $700 million. Sentinel initially acquired Pet Supplies Plus back in 2018.
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Lower-middle-market-focused Lonsdale Capital Partners has exited yacht painting and supply company GYG PLC, tripling its investment and recording a 75% internal rate of return from the deal, according to a news release sent by email. Lonsdale initially backed the Palma, Mallorca-based company in 2016 and retained a stake after GYG listed its shares on the London Stock Exchange’s Alternative Investment Market in 2017. GYG reported 2019 revenue of about €63.8 million (equivalent to $77.7 million).
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Oakley Capital has closed its Origin Fund to institutional investors with expected final commitments of €455 million (equivalent to about $554 million), Mark Latham reports for sister publication Private Equity News in London. The Origin Fund is Oakley’s first vehicle focused on investing in lower mid-market companies and will target the technology, consumer and education sectors. The fund was raised in just over six months and closed 30% above its target size.
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Upper Bay Infrastructure Partners, a midmarket private infrastructure firm, said it has hired Caitlyn MacDonald as partner and head of investor relations at the firm. Ms. MacDonald most recently served as head of investor relations at Lee Equity Partners but her career also includes stints with oil and gas focused First Reserve Corp. and fund-of-funds manager SVG Advisers.
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Growth investment firm TA Associates said it has hired Chris An as a senior vice president in the firm’s Hong Kong office. Mr. An was previously an investment director at CVC Capital Partners.
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Perella Weinberg Partners said it has promoted three professionals to its partner ranks: John Cesarz in New York, Jackie Chan in San Francisco and Guy Morgan in London.
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Shorehill Capital has promoted Charlie Denison to managing director from principal and Robert Jackson to principal from vice president. Mr. Denison joined the Chicago firm in 2018 while Mr. Jackson came aboard in 2015.
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Pantheon has made dozens of promotions and new hires, including elevating Petra Bukovec, Jérôme Duthu-Bengtzon, Dinesh Ramasamy and Kara Zanger to partner. Ms. Zanger is global head of legal for the U.K. firm, based in New York, while Mr. Ramasamy is based in San Francisco. Ms. Bukovec and Mr. Duthu-Bengtzon work from London.
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NCR Corp. is nearing a deal to buy Cardtronics PLC after outbidding a pair of investment firms that had earlier agreed to buy the ATM operator, Cara Lombardo and Miriam Gottfried report for WSJ. NCR is finalizing a takeover that would value Cardtronics at $39 a share, or around $1.7 billion, according to people familiar with the matter. As always, the talks could fall apart before a deal is reached. The investment firms—private-equity giant Apollo Global Management Inc. and Hudson Executive Capital LP—declined to raise their prior offer of $35 a share, paving the way for the impending deal.
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Francisco Partners topped the list in the 2020 HEC-Dow Jones Private Equity Performance Ranking, Elisângela Mendonça reports for sister publication Private Equity News in London. The tech-focused buyout group in San Francisco was crowned top performer, rising from 16th place in the 2019 rankings. Created by educator and researcher Oliver Gottschalg, the listing is now sponsored by asset management consulting firm MJ Hudson and looks at buyout fund performance for vehicles raised from 2007 to 2016, drawing on data provided by Preqin Ltd. and directly from firms.
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Oaktree Capital Management-backed solar-equipment supplier Shoals Technologies Group Inc. raised the size and expected price range of its initial public offering of shares, Colin Kellaher reports for Dow Jones Newswires. The Portland, Tenn.-based company plans to sell 70 million shares at $22 to $23 each, up from 50 million shares at $19 to $21 each as Oaktree increased the amount it expects to sell to 61 million shares from 39.5 million initially. Oaktree owns Shoals through its Power Opportunities strategy, which initially backed the company in 2017.
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Video platform Vimeo Inc. has completed a $300 million fundraising round that values the company at $5 billion, an 82% boost from a raise three months ago, Kimberly Chin reports for Dow Jones Newswires. The round was led by funds and accounts advised by T. Rowe Price Associates Inc. and financial-services firm Oberndorf Enterprises LLC. The new capital will be used to fuel its growth, innovation and talent, Vimeo parent IAC/InterActiveCorp said Monday.
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