Maitland/AMO Private Equity Monitor – 19 November 2021

19th November 2021

Worth a read


Don't take the rap for the push into property

A leader in the Economist writes that the current push for policymakers worldwide to restrict the types of properties large investors want to buy, should be welcomed. It notes that large investors have large appetites and ambitions with build to rent flats becoming a lucrative line of business for Wall Street firms such as KKR and Goldman Sachs. Noting that demand for rental housing has never been higher, with falling ownership rates across the developed world means that decent quality housing in the private rented market is more sought after than ever. The outlet welcomes the flood of institutional money coming, at a “crucial time”. Noting that the pandemic might foster innovative imagination, with an overhaul of planning rules, it also necessitates extra funding to pay for the building work.

On your marks, get set, go!

Private Equity News reports that buyout firms worldwide have raised more than $714bn in dry powder so far this year according to Preqin and the mountain of unspent capital is due to reach new heights as the race is on for next year.  The piece notes that the surge in fundraising is being fuelled by continued investor appetite for private equity exposure which can offer strong, uncorrelated long-term returns even amid a persistently low interest rates environment. And that’s a challenge for LPs as they scramble to find the resources – and energy – to keep up.

Sharpen the carving knives

General Electric’s decision to split into a tripartite shadow of its former self has set the stage for what the Financial Times terms as a “feeding frenzy” among private equity buyers who are looking to carve up the industrial conglomerate into smaller pieces. The piece notes that a flurry of private equity deals to complete the unwinding of GE would effectively herald the end of one era in financial management and the rise of another. One private equity partner who called GE’s break-up the “death knell” of the conglomerate business strategy.

Private equity prevented from capital deployment

Investment Week looks at data that shows that over 67% of private equity firms have cited market conditions over the last year as a key barrier to deploying capital, according to a new market report from Gallagher. The report surveyed 150 private equity firms across the UK, US and Asia. Limited capital capability was felt most acutely in the UK with 72% of firms revealing conditions prevented capital deployment compared to 62% in Singapore which possibly reflected the harsher effects of the pandemic across Europe.


Wall of money


Oaktree closes its 11th fund at $16bn

A Los-Angeles based private equity firm, Oaktree Capital Management, has made a final close of its 11th distressed debt fund at $15.9bn, exceeding its original target of $15bn. The fund is the largest in Oaktree’s 25 year history.

Adelis closes its third fund on €932m

Adelis has closed its third fund on top at €932m. The fund was significantly oversubscribed and raised €855m from external investors, on top of which, Adelis’ employees have committed to invest €77m, which pushed the total fund size to €932m.


Deal chart


Acquisition TargetBuyerSellerValueDate AnnouncedRegionSector
CESIF, ISEP and CEEPMagnum Capital-Undisclosed19/11/2021SpainEducation
INTERNILifestyle DesignProgressioUndisclosed19/11/2921ItalyLifestyle and consumer
G+E GETECJP MorganEQTUndisclosed19/11/2021EUEnergy
ekaterraCVCUnilever€4.5bn18/11/2021EURetail and Consumer
DiversiTechPartners GroupPermira$2.2bn18/11/2021USTechnology
3iMepal-Undisclosed18/11/2021The NetherlandsRetail and consumer
CardiolineArchiMed-€650m18/11/2021ItalyMedical equipment
Iconic ImagesAuthentic Brands GroupVGC Partners£20m18/11/2021UKCultural archive
Accordia GolfFortressMBK$3.5bn17/11/2021JapanLeisure
AutoForm EngineeringCarlyleAstorg$2bn17/11/2021SwitzerlandIndustrial software
BioAgilytixCinvenGHOUndisclosed17/11/2021BelgiumResearch services
CawoodEnsign-Bickford IndustriesWaterland3.7x MM, 79.9% IRR16/11/2021UKIndustry services
Opus Talent SolutionsGraphite Capital-Undisclosed16/11/2021UKRecruitment
Park HolidaysSun CommunitiesICG£900m15/11/2021UKRetail and consumer
Scaled AgileEurazeo-$300m15/11/2021USBusiness services
MINTTikehau Capital-Undisclosed15/11/2021ItalyMarketing and advertisement

Movers and Shakers


UK & Europe

Evolution Capital Partners has appointed Kim Lapcewich as a partner. She was previously senior director of human resources for Moen and held positions at KeyBank and United Airlines.

Connection Capital has appointed Lucy Merson as investment manager and Laura Scott as investment executive. Merson joins from BDO, where she focused on advising high growth businesses seeking funding, and Scott was previously at Grant Thorton’s corporate finance team, providing transaction advisory services to SMEs.

 

 


From the horse’s mouth...

It’s tempting to eat them all at once… but it wouldn’t be the right thing to do” – Philipp Freise, KKR’s European private equity co-head, likening private equity’s use of debt to children’s approach to a box of chocolates 

The fundraising market for next year looks astoundingly busy” – Gabrielle Joseph, head of due diligence and client development at Rede Partners 

The only guilty pleasure I have is pasta” – Alison Janney, actress, born on this day in 1959