Maitland Private Equity Monitor – 8 June 2018

8th June 2018

Worth a read


Private equity investing is often genuinely long-term

In a letter published in the FT, Coller Capital Founder and private equity veteran Jeremy Coller argues that last week’s piece by FT commentator John Gapper was “a little unfair” in how it portrayed the private equity industry. Specifically commenting on the part of his article which noted, “Of all the confidence tricks in financial markets, the proposition that three to five years means long term is among the most brazen.” He notes that this is not a private equity fund’s typical holding period, but the horizon over which funds put their money to work. Financial Times, 4 June 2018

The mystery trader who roiled Wall Street

This week’s FT Big Read focused on a former executive of The Blackstone Group who used complex credit derivatives to become a feared hedge fund manager but left behind a trail of recriminations. The piece argues that the GSO unit at Blackstone where Akshay Shah worked became the biggest predator in the global credit default swap market by going beyond merely trying to predict when companies would fail. Instead it used Blackstone’s substantial influence to directly intervene in struggling businesses, changing their fates in ways that maximised profits on GSO’s trades. Financial Times, 4 June 2018

Italian Private Equity on Hold Amid Political Upheaval

A political crisis is casting a shadow over private-equity activity in Italy. Augusto Lippi, founder of Milan-based M&A advisory boutique Dome Capital Advisors, said deal making was on hold as firms assessed the fallout of the country’s election in March. “We are all scared of not understanding what is going to happen, rather than of what is happening,” said Mr. Lippi, who left CVC Capital Partners to set up Dome earlier this year. Private Equity News, 4 June 2018

Abraaj Creditor Seeks Embattled Dubai PE Firm's Liquidation

Kuwait’s Public Institution for Social Security is seeking the liquidation of Abraaj Holdings as creditors step up pressure on the Dubai-based buyout firm that’s facing allegations of misused funds. Earlier in the week, it was reported that Cerberus Capital Management LP was offering $125 million to acquire Abraaj’s private equity business. Bloomberg, 7 June 2018


Wall of money


L Catterton close to wrapping up third Asia fund

L Catterton has announced it expects to close its third buyout fund above its $1.25bn target this September. The fund, which has a hard cap of $1.4bn, has already raised $844.4m and struck four deals. Private Equity News, 6 June 2018

Hamilton Lane collects $900 million for credit fund

Hamilton Lane has closed its fourth private credit fund on around $900m. The new fund, which significantly outpaced its predecessor, will target credit investments with consistent cash yield and shorter durations. Private Equity News, 5 June 2018

Former Goldman banker Byron Trott plans fundraising

Byron Trott, the longtime adviser to billionaire investors including Warren Buffett, is in discussions to raise a new private equity fund, tapping into the growing demand for such investments from wealthy families. He has set a target of $9bn, according to three people with knowledge of the talks. Financial Times, 6 June 2018 


Deal chart


Acquisition TargetBuyerSellerValueDate AnnouncedRegionSector
IpesApex GroupSilverfleet CapitalUndisclosed, 3.8x return06/06/2018UKFund Administration
Cory Riverside EnergyFiera Infrastructure, Semperian PPP Investment Partners, Dalmore Capital and Swiss Life Asset ManagersStrategic Value Partners, EQT Credit and CommerzbankOver £1.5bn06/06/2018UKWaste Management
IntellifloInvescoHg CapitalUndisclosed, 5x return06/06/2018UKSoftware
Chewy.comBC PartnersPetSmart IncUndisclosed06/06/2018USRetail
OutSystemsKKR & Goldman Sachs-$360m05/06/2018PortugalSoftware
Chinese Arm DivisionLocal Financial Investors and Arm PartnersSoftBank$775m05/06/2018ChinaTechnology
Ammeraal BeltechPartners GroupAdvent InternationalUndisclosed05/06/2018NetherlandsIndustrials
Self Trade BankWarburg PincusBoursoramaUndisclosed05/06/2018SpainBanking Service
Walmart BrazilAdvent InternationalWalmart Inc.Undisclosed04/06/2018BrazilRetail
LogRhythmThoma Bravo-Undisclosed01/06/2018USSoftware
Toshiba MemoryBain Capital-$18bn01/06/2018JapanTechnology

Movers and Shakers


UK & Europe

Alasdair Warren, Head of Corporate Finance at Deutsche Bank in London, has left the firm to pursue other opportunities. Link

Investec has recruited Galina Markova, from SMBC, to join its corporate and acquisition finance team. Link

Will Southgate and Gessica Howarth have joined the Rutland Partners deal team and will take up the positions of investment manager and investment executive respectively. Southgate joins Rutland from PwC and Howarth joins from Goldman Sachs. Link

US

The head of KKR’s industrials investment team, Jonathan Smidt, has left the company after 18 years. He will be replaced by Edouard Pillot, currently Partner at the firm. Link


From the horse’s mouth...

“Private equity is active management on steroids. It has worked for investors so far, and they think it will go on working.” – Jeremy Coller, CIO and Chairman of Coller Capital

“Bitcoin is mathematically defined, there is a certain quantity of bitcoin, there’s a way it’s distributed and it’s pure and there’s no human running, there’s no company running and it’s just … growing” – Steve Wozniak, Apple Co-founder, on his support for bitcoin

“You can’t make promises you can’t keep.” – Howard Lutnick, CEO Cantor Fitzgerald and BGC Partners