Maitland/AMO Private Equity Monitor – 4 October 2019
Worth a read
In an interview with David Wighton of Financial News, Intermediate Capital Group’s CEO Benoît Durteste said that the firm was undeterred by record levels of dry powder and concerns over future returns as it enters the US private equity market. The firm recently hired Alan Jones from Morgan Stanley to lead the push into North America and wants its investors to know that it is “not just about debt”, where the roots of the business lie. ICG’s hybrid funds allow it to invest in both debt and equity in Europe, an approach which has been very attractive to investors, according to Wighton.
The Financial Times‘ Lex column opined this week on the fate of settlement house Euroclear, which is reportedly in the firing line of Hellman & Friedman. Lex suggests that Euroclear is a mature but appealing business with room to raise margins, but that customers might be nervous about being forced to pay higher fees. H&F has experience as a minority investor, but the structure could be a little too messy for the PE firm to deal with.
The debate over private equity investment in prisons is said to have caught the eye of US politicians, in particular the biggest opponent to private equity on Capitol Hill – Elizabeth Warren. Private Equity News reported that Warren, along with two Democratic colleagues, have sent letters to five private equity firms to express concerns over investments in prison services providers. American Securities, Apax Partners, BlueMountain Capital Management, H.I.G. Capital and Platinum Equity all received letters stating that “private equity owned prison support services use their market power to make millions of dollars off those who are incarcerated, their families, and their communities – often while providing subpar products and services”.
Analysis from Bloomberg has found that women fill only 8% of senior investment roles globally at the 10 largest firms, with only one or two present in top positions on buyout teams. Carlyle Group was found to have the greatest number of women in senior investment roles, with TPG having the best percentage, with 14%.
Wall of money
The private equity firm led by Tom Gores is approaching a second close of more than $9bn for its latest fund, which will be its largest ever. The firm said it expects to hit the hard-cap of $10bn before the end of the year.
Kempen Capital Management has held a third close of the Kempen European Private Equity fund at a total of €158m. The fund has a maximum target of €200m and has already made six investments. The fund invests in companies with an enterprise value of €10m to €150m.
INVL Asset Management has held the second close of its fund, INVL Baltic Sea Growth Fund, raising close to €142m. Investors in the fund include pension funds, private investors, corporate investors and the European Investment Fund.
|Acquisition Target||Buyer||Seller||Value||Date Announced||Region||Sector|
|Great Wold Resorts||Blackstone Group||Centerbridge Partners||Undisclosed, 65% stake||03/10/2019||US||Travel & Leisure|
|NADG||Jacobs Holding||Riverside, Abry Partners||Undisclosed||03/10/2019||US||Healthcare|
|Ele Advanced Technologies||LDC||Albion Capital and Maven Capital Partners||Undisclosed||03/10/2019||UK||Engineering|
|Industria Chimica Emiliana||Advent International||-||Undisclosed||01/10/2019||Italy||Pharmaceuticals|
|Gruppo Menghi||Lion Capital||-||Undisclosed||01/10/2019||Italy||Fashion|
|US industrial warehouses||Blackstone Group||Colony Capital||$5.9bn||30/09/2019||US||Logistics|
|inexio||EQT||Warburg Pincus||c. €1bn EV||30/09/2019||Germany||TMT|
|Siblu Villages||Naxicap Partners||Stirling Square Capital Partners||Undisclosed, 3x return||27/09/2019||France||Travel & Leisure|
Movers and Shakers
Jorge Huitron has been appointed as a senior product specialist in HSBC‘s alternatives team in London, joining from Aon Hewitt.
UK-focused Apiary Capital has hired Jessica French as an investment manager from boutique investment bank Financo.
Beech Tree Private Equity has appointed Simon Hemley to the role of director. He most recently served as head of the Bristol office at LDC.
BGF has hired Guy Pope as an investor in its Reading team from BCMS Corporate. The firm has also recruited Daina Spedding for its London office from Blue Coast Capital.
John Kim, formerly head of Goldman Sachs‘ M&A team in Asia has left to join Carlyle as a management director in its Asia buyout team.
From the horse’s mouth...
“We believe there is a gap for us in private equity in the US…At the same time it is sending a broader message to investors that we are not just about debt.” – Benoît Durteste on the Intermediate Capital Group’s US ambitions
“There is a huge retention problem, since nothing has materially changed at the top” – Nori Gerardo Lietz, a senior lecturer at Harvard Business School on diversity in private equity
“You can’t always do the extraordinary, in between you have to do the ordinary. Because if you didn’t, what would constitute the extraordinary?” – Christoph Waltz, actor and director, born on this day in 1956