Monitor
Private Capital Monitor 23/02
29th February 2024
WORTH A READ
EUROPE
KEEP IT SIMPLE DURING FESTIVAL OF DEMOCRACY
2024 will draw half the world’s voting-age population – around 1.5bn people – to the polls, bringing significant disruption. Adding in the other uncertainties around Ukraine, China, and volatility, we’re due for a rather stormy year. Our Managing Partner, Sam Turvey, penned an opinion piece in PR Week that examined how in these rough times it’s time for big and established companies we all rely on to be seen as a true partner of choice for all their stakeholders. But for this, companies need to focus on proactive but straightforward messaging – clear business communications – around providing much needed stability.
Will Louch, Private Capital Reporter at the Financial Times, examines how Private equity firms, facing challenges in traditional fundraising amid a tough market, are turning to new tactics like single deal offerings with cheaper fees to attract investors. Deal-by-deal transactions, favoured by institutional investors, offer lower fees and allow investors to choose preferred companies upfront, with quicker deployment and return of funds.
Private Credit is having its day in the sun, as Citywire reports. The rapidly growing asset class has propelled the assets of six of the largest alternative asset managers in 2023 to new heights despite a challenging fundraising market in 2023. Blackstone, Carlyle, Ares Management, KKR, Apollo and TPG have all highlighted the asset class as a significant driver of asset growth.
United States
WSJ Pro Private Equity’s Chris Cumming reports that, following several decades of pressure, the Treasury Department has announced a proposal that will require private equity managers to have programs in place to prevent money laundering. According to Andrea Gacki, head of the Treasury’s Financial Crimes Enforcement Network, the new rules will “level the regulatory playing field, protect U.S. economic and national security, and safeguard American businesses.”
Amid a historic deal drought and a significant 49% drop in payouts to fund investors compared with 2021, private equity investors are turning to a new metric to measure investment success. Distributed to Paid-In capital, or DPI, which is the ratio of cash generated to what’s invested, has overtaken IRR as the most critical metric according to Bloomberg.
WALL OF MONEY
CVC Adds to Fundraising Spree With $6.8 Billion Asia Fund
CVC Capital Partners, one of Europe’s biggest private equity firms, has raised $6.8 billion for its largest-ever Asia fund as it continues to defy a difficult fundraising environment.
Future Food Fund closes €40m impact VC vehicle
The fund will invest in seed and Series A funding rounds for Western European agtech companies, with an emphasis on regenerative agriculture, zero-impact foods and circular systems.
DEAL CHART
| Acquisition Target | Buyer | Seller | Value | Date | Region | Sector |
| Gigamon | Siris | – | – | 22-Feb | US | Technology |
| Hornblower | SVP | Crestview Partners | – | 21-Feb | US | Travel experiences |
| DocuPhase | Aquiline Capital Partners Level Equity |
– | – | 21-Feb | US | Accounting software |
| Arctic Industries | Kinzie Capital Partners | Stoic Holdings | – | 21-Feb | US | Temperature and storage solutions |
| EDP Brazil – Transmission Lines Assets | Actis | EDP Group | – | 21-Feb | Brazil | Energy |
| Truist Insurance Holdings | Stone Point Capital Clayton, Dubilier & Rice Mubadala Investment |
Truist Financial | $15.5bn | 20-Feb | US | Insurance |
| Centrepoint Energy – Natural Gas | Bernhard Capital Partners | – | $1.2 billion | 20-Feb | US | Natural gas |
| EEF | Omnes | – | – | 20-Feb | Germany | Energy solutions |
| Assala Energy (Carlyle) | Gabon’s national oil company | – | – | 16-Feb | Gabon | Oil |
| MB2 | KKR | – | $2.34 bn | 15-Feb | US | Dentistry |
MEDIA OF THE WEEK
PEI Group Hong Kong bureau chief Alex Lynn sits down with three of the region’s most senior fundraisers to discuss how shifting LP appetites are reshaping markets.
MOVERS AND SHAKERS
- Appian Capital Advisory has appointed former deputy prime minister and foreign secretary Dominic Raab as a senior strategic advisor on global affairs.
- Eurazeo has appointed Katrin Boström as managing director within its investor’s relations team. She will be tasked with developing Eurazeo’s client franchise and fundraising within the Nordics and the UK.
- Mustafa Siddiqui, a longtime Blackstone executive who has led the firm’s division that invests in other private equity firms since 2020, is to leave as part of a wider reorganisation of the business.
FROM THE HORSE’S MOUTH
“In uncertain times large corporates become more important. They must be visible and easy to understand. It’s not a year to hide nor overcomplicate things.” – Sam Turvey, Managing Partner at H/Advisors Maitland
“Barely a conversation goes by with investors who aren’t looking at, or are open to, doing deal-by-deal type investments. It’s everyone from insurance companies, [to] sophisticated family offices and even sovereign wealth funds.” – William Clegg, Partner at private equity advisory firm Colmar Capital
“Knowledge is in every country the surest basis of public happiness.” – George Washington, 1st President of the United States, born on this day in 1732.
