Maitland/AMO Private Equity Monitor – 12 April 2019

12th April 2019

Worth a read


IMPACT INVESTMENT REACHES RECORD HIGH

According to Private Equity News,  the impact investing industry is on the up. Following a recent survey, firms have registered a record $502bn in impact assets globally. But in addition to the plaudits and commentary that the market is not a busted flush – but is here to stay, there are the usual assortment of sceptics and naysayers, in part due to the general inevitability that impact funds tend to back companies in challenging economies with issues of currency liquidity and exit difficulty. But the impact investing industry has the last laugh: it’s worth more than half a trillion dollars – and counting.

THE $1TN GOAL

The Financial Times trumpets that 2019 is all set to be a record year for fundraising.  According to a (yet another) survey, a record 3,749 private equity funds heralded the new year by touting their wares for fresh capital, nearly 63% up compared to January 2018. Private equity managers are hoping to raise close to $1tn in new cash this year but with an increasingly crowded field, competition to attract fresh capital is extraordinarily fierce. Let the games continue…

PRIVATE EQUITY TURNS TO SPORT

And a different sort of game this time – one involving turf, sweat and occasionally, tea. The global sporting industry is being eyed up by private equity investors. It’s an attractive asset worth a cool $600-$700bn. According to Private Equity News, the industry is on track to grow at a rate of 5-10% annually. Although it holds widespread appeal, the sports industry also presents formidable challenges that wise private equity investors should caveat before emptoring [with apologies to all classicists]: complex stakeholder environments, from fans to governments, regulators and national institutions all act as significant challenges. However despite this, in recent years, there has been a significant uptick in interest among private equity firms which shows little sign of dissipating.

ABRAAJ EXECUTIVES UNDER ARREST

The sorry saga of Abraaj continues apace: The Financial Times reports that Abraaj’s former founder and a former managing partner have been arrested on a smorgasboard of fraud charges in relation to charges that they defrauded investors by lying about Abraaj’s financial health. Arif Naqvi and Mustafa Abdel-Wadood’s arrest in London and New York respectively marks the most serious chapter in the tale of Abraaj’s implosion.

ACTIVIST INVESTORS INCREASING CORPORATE CARVE-OUTS

Activist investors are really turning the screws on a raft of corporations. According to Private Equity News 2018 marked a record year when activist investors launched 58 campaigns with $15.7bn in market value. And it’s making an impact: many companies are selling non-core businesses driven by pressure from activist investors. Apart from showing everyone that they have a seat at the table, activist investors appear to be buoyed by companies underperforming and challenging macroeconomic conditions. Company boards need to watch out…


Wall of money


Bex Capital sallies on forth beyond its hard cap to close at $365m

BEX Capital has held a first and final close for BEX Capital III and has surpassed its $280m target in January – nearly double what its predecessor collected in 2017.

La Vita is looking bella at Equinox

Equinox Investments has raised €230m for its third private equity vehicle, Equinox III. Launched at the beginning of last year, with a €300m target, the fund expects to reach a final close in June.

HQ Equita completes fundraising for fund number 5

HQ Equita has completed fundraising for its fifth fund, with €308m in capital commitments. The fund is due to focus investments on small and medium sized enterprises in Germany, Austria and Switzerland.


Deal chart


Acquisition TargetBuyerSellerValueDate AnnouncedRegionSector
Athena Art FinanceYieldStreetThe Carlyle Group$170m11/04/2019USArt
SignicatNordic Capital-Undisclosed11/04/2019NorwaySoftware
IVC GroupNestlé Purina PetCareEQTUndisclosed09/04/2019UKPetcare
MlinarMid Europea Partners-Undisclosed09/04/2019CroatiaFood & Drink
CepsaThe Carlyle Group-Up to $4.8bn08/04/2019SpainOil & Gas
DOC GenericiICG & Mérieux Equity PartnersCVC Capital PartnersUndisclosed08/04/2019ItalyPharma
Wiedmann & BergKKR-Undisclosed08/04/2019GermanyEntertainment
AmberjackLDC-£17.6m08/04/2019UKTMT

Movers and Shakers


Europe

Nordic Capital has appointed Rainer Lenhard as Co-head of DACH in its Frankfurt office. He joins from Goldman Sachs.

Capzanine has hired Philippe Minard to lead a three-strong team of private credit professionals in Milan. The team have joined from Emisys Capital.

Omnes Capital has announced a raft of promotions and hires to its buyout, growth capital, private debt and venture capital teams in Europe, including Benoit Faguer from Aviva Investors.


From the horse’s mouth...

This seems to be another credit agreement written on a cocktail napkin” – John McClain, a portfolio manager at Diamond Hill Capital Management gives his view on Sycamore’s refinancing of office supply superstore, Staples Inc. 

“Activist investors are more influential than they have ever been, as the level of capital being invested in and deployed by their strategies reaches an all-time high,” – Tristan Nagler, UK managing director at Aurelius.

There are very few people on top of life, and the rest of us don’t like them very much” – Sir Alan Ayckbourn, playwright, born on this day in 1939.