Maitland/AMO Private Equity Monitor – 10 January 2020
Worth a read
Salary and bonus payments in private equity: it’s what everyone wants to know. How big are they? Well, the Financial Times might be able provide some insight with the help of a survey by a Chicago-headquartered executive search company. Its findings make for interesting reading: over half of respondents reported an increase in base salary last year, while 77% indicated that their bonus increased in 2018. But despite some managing partners (10) collecting fees of between $112.5-$120m (whose companies run assets between $2bn and $10bn) there was harrumphing about remuneration from lower down the pecking order: nearly 2/3 of associates or senior associates felt underpaid.
Stepping through the detritus of WeWork’s IPO last year, many other so-called “decacorns” are looking to float but are treading carefully. According to Private Equity News, companies which are eyeing up a stock market are focusing more on profitability as opposed to outright revenue growth and also a greater focus on corporate governance. Similarly industry sources are drawing a distinction between real technological companies and those which are “tech-enabled”.
The private equity industry often gets a poor rep for its cloak and dagger style secrecy. Well, there’s now a push coming form across the pond. The Wall Street Journal reports that Allianz is throwing its substantive weight behind a campaign to ensure that private equity firms standardise how they report performance and fees as well as boosting transparency, in a bid to avoid corruption and the risk of fraud in the cash rich industry.
Australia’s tragic wildfire outbreak is affecting the way private equity firms do their due diligence. According to Private Equity International, private equity firms in Australia are increasing their due diligence processes as a result of the country’s changing climate. Carlyle Group’s portfolio company, Accolade Wines, has apparently experienced a “limited” impact to its vineyards as a result of the wildfires.
Wall of money
Platinum Equity Partners has announced that it has raised $10bn for its fifth fund despite, wrote Private Equity News, pressure from the public over its investment in prison phone operator Securus Technologies. The fund has raised more than $7bn by July and is more than 50% bigger than Platinum’s previous flagship fund ($6.5bn).
Rothschild & Co has raised €1bn for its latest secondaries fund in the European small and mid market – Five Arrows Secondary Opportunities V. The fund exceeded its initial target of €700m.
London-listed Intermediate Capital Group has announced the final close of its Mid-Market fund, which will complement the firm’s flagship vintage. The new strategy is led by Gareth Knight, with support from recently appointed Peter Kirtley and Robin Molvin.
|Acquisition Target||Buyer||Seller||Value||Date Announced||Region||Sector|
|EcoVadis||CVC Capital Partners||-||$200m||09/01/2020||France||Business Services|
|Netrisk||TA Associates||MCI Group||€55m, 3x return||09/01/2020||Hungary||Financial Services|
|Lytx||Permira||GTCR, Clearlake Capital||Undisclosed||08/01/2020||US||Technology|
|Global Attractions||Accent Equity||-||Undisclosed||07/01/2020||Sweden||Travel & Leisure|
|KRY||OTTP, Index Ventures, Creandum, Accel||-||€140m||07/01/2020||Sweden||Healthcare|
|The Dedica Anthology hotels||Covivio||Värde Partners||Undisclosed, €600m EV||06/01/2020||Europe||Travel & Leisure|
|mthree||John Wiley & Sons||ECI Partners||£100m, 2.7x return||06/01/2020||UK||Education|
|Allied Glass||Sun European Partners||CBPE Capital||Undisclosed||06/01/2020||UK||Manufacturing|
|Borealis Hotel Group||Three Hills Capital||-||Undisclosed||06/01/2020||Netherlands||Travel & Leisure|
|Pure Cottages Group||Sykes Holiday Cottages||LDC||Undisclosed||06/01/2020||UK||Travel & Leisure|
|Metz-Amnéville zoo||Prudentia Capital||-||€25m||03/01/2020||France||Zoology|
Movers and Shakers
ECI Partners has promoted Suzanne Pike to partner. Suzanne joined ECI in 2011 to work on deal origination and has led the Origination Team for the past two years.
Ares Management Corporation has hired Stephane Etroy as head of European private equity from Caisse de dépôt et placement du Québec.
Intermediate Capital Group (ICG) has appointed Peter Kirtley and Robin Molvin to its mid-market origination team. They join from Beechbrook Capital and Ratos respectively.
Standard Life Private Equity has appointed Alan Gauld as lead manager of the private equity investment trust with immediate effect.
LDC has appointed Oliver Schofield as an investment director in a bid to boost its South West and Welsh teams. He joins from Goldman Sachs.
Matthew Hansen and Miroslav Boublik have set up a new private equity business: Financial Services Capital Partners. The business will invest in financial services companies in Europe.
Michael Whitman has left GSO Capital Partners, the $142bn credit unit of Blackstone Group. Mr Whitman’s departure follows a group of other senior executives who have left the company in recent years.
Barclays has hired Christian de Haaij, as vice chairman for Europe. Previously, de Haaij had been at private equity firm, Cobepa and prior to this, he was co-head of investment banking for France, Belgium and Luxembourg at Goldman Sachs.
Hamilton Lane has appointed Atul Varma as CFO and treasurer. Mr Varma had been head of business strategy and CFO of wealth management at the Bank of New York Mellon Corporation.
From the horse’s mouth...
“2020 will add the uncertainty of a polarised US election which won’t be easy to navigate“- Raymond Svider, chairman of BC Partners shares his insights into challenges in 2020
“Every case over the past four years we underwrote, we assumed a recession.” – Dan Zilberman, Head of Europe at Warburg Pincus
“Judicial Pre-Raphaelites read everything, whereas judicial Impressionist read very little – often just skimming the skeleton arguments. I must … confess to being an Impressionist.” – Lord Neuberger of Abbotsbury, former president of the UK Supreme Court, born on this day in 1948