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Monitor

Private Capital Monitor 19/01

24th January 2024

 

WORTH A READ

Europe

IS CREDIT CATFISHING?

Robin Wigglesworth writes for Financial Times Alphaville on stresses facing private credit markets. Wigglesworth, along with contributor Oleg Melentyev, Bank of America’s credit strategist, make use of a high yield proxy from the public markets to suggest that default rates for the private credit sector could range from 4.5% – 7.7%.

TIME’S UP

At the World Economic Forum in Davos, according to The Financial Times, dealmakers contend that the pressure to return cash to investors will compel buyout groups to sell their investments, even in the face of low valuations and a notable surge in takeover activity.

YOUR OWN BACKYARD

City AM speaking to London lawyers and PR firms reveals London’s listed firms are revisiting “defence manuals,” which are typically prepared to address hostile takeover attempts. In recent months, listed firms have been actively conducting “dry runs” as part of their preparations to fend off unwanted approaches from private equity houses.

 

US

THINGS ARE LOOKING UP, MATE
Australia’s largest pension fund is preparing for a huge surge into the U.S. private equity market, according to Axios Pro Rata’s Dan Primack. AustralianSuper, which currently manages nearly US$200 billion, is planning to double its global private equity investment over the next five years with a majority of new funds targeted towards the U.S.

GIVING PRIVATE EQUITY A RUN FOR ITS MONEY

FORTUNE reports that institutional investors, including sovereign wealth funds and state pension providers, are threatening to withhold new investments unless certain demands are met, including the release of their capital tied up in old funds, fee discounts and more co-investment opportunities. William Barret, managing director at private-market fundraising firm Reach Capital calls this a “real cultural change” as noted that LPs have “never been so precise with their asks.

 

WALL OF MONEY

Committed Advisors closes fifth flagship secondary fund at €2.6bn
The final closing has increased the fund’s size by 65% compared to the vintage 2020 predecessor fund.

KSL exceeds $1bn target in final close of fourth private credit fund
Credit Fund IV closed at $1.26 billion and will operate across five key sectors: hospitality, recreation, clubs, real estate and travel services.

Bowmark closes seventh flagship fund on £900m
Bowmark’s seventh flagship fund will invest in data and insight, managed IT services, software and tech-enabled business services firms valued at up to £300m, with ticket sizes up to £200m.

EV-charging startup Electra raises €304m Series B to expand European network
The electric vehicle charging startup, Electra, raised $330 million to grow its network of charging stations across Europe. This marks the second-largest fundraising event in Europe’s EV charging sector.

 

DEAL CHART

Acquisition Target Buyer Seller Value Date Region Sector
Geopixel Sogelink (CVC, Keensight) 18-Jan France Topographic software
This AG Rayner (CVC) 18-Jan Switzerland Cataract surgery equipment
Ex Nihilo Eurazeo €25 million 18-Jan France Perfume
Actis General Atlantic 16-Jan UK Infrastructure fund management
Sayari Labs TPG $228 million 16-Jan US Supply-chain risk
Sunday Natural CVC €800 million 15-Jan Germany Vitamins and supplements
La Piadineria CVC Permira 15-Jan Italy Restaurants
Sportech Patrick Industries Monomoy $315 million 12-Jan US Components and assemblies
Global Infrastructure Partners BlackRock $12.5 billion 12-Jan US Infrastructure fund management
Associated Spring &
Hänggi
One Equity Partners Barnes Group $175 million 11-Jan US Spring and precision metal components

 

MEDIA OF THE WEEK

David Rubenstein, Co-Chairman of Carlyle Group, speaks with Bloomberg’s Francine Laqua at Davos on his outlook for private equity activity in 2024, sector consolidation, and the impact of higher for longer interest rates.

Watch the video here

 

MOVERS AND SHAKERS

  • Clayton, Dubilier & Rice has appointed Sir Dave Lewis as an operating adviser.
  • Permira Credit has promoted David Hirschman and Ariadna Stefanescu to Co-Heads of the business.
  • Blackstone has promoted Ken Caplan and Lionel Assant to Co-Chief Investment Officers. Nadeem Meghji has been appointed as Global Co-Head of Real Estate.
  • CVC Capital Partners has appointed Brechje van der Velden as its new Legal Chief and Compliancy Officer.

 

FROM THE HORSE’S MOUTH

“Private equity will look different over the next 10 years than it looked over the past 10 years…It will be a little bit back to the future in a sense.” – Marc Nachmann, Global Head of Asset and Wealth Management at Goldman Sachs.

“There will be portfolios that are more challenged and you will have private equity firms in decent shape ready to make bids for some of those assets.” – Rob Lucas, lead Managing Partner of the Investment Committee for CVC Capital Partners’ European and Americas and Strategic Opportunities funds.

“Know yourself to improve yourself” – August Comte, French philosopher, born on this day in 1798.

 

Get in Touch

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Rebecca Gaffney

Analyst
rebecca.gaffney@h-advisors.global
+44 (0) 2073 954 433