S&P Global Market Intelligence offers our top picks of global private equity news stories and more published throughout the week.
Global pension funds collectively fell short of their intended allocation to private equity in the first quarter, according to an S&P Global Market Intelligence analysis of data from 344 global pension funds.
Pension funds targeted an allocation to private equity of $276.4 million at the median. But the actual median allocation was just short, at $272.8 million.
While seemingly a minor miss, it also represents a nearly $17 million swing from early January, when pension funds were net overallocated to private equity by an estimated $13 million.
Private equity fund managers have pension funds in mind as they work to rebuild momentum behind fundraising, which fell to a six-year low in 2023. Reversing an extended slowdown in exits would help. Some of the cash returned to investors after the sale or IPO of a portfolio company is typically recycled into a new private equity fund.
Read more about pension fund allocations to private equity falling below target in the first quarter.
CHART OF THE WEEK: Venture capital deals decline
⮞ The value of global venture capital deals in the first quarter totaled $71.57 billion, down more than 2% from $73.31 billion a year earlier, according to Market Intelligence data.
⮞ Deal value for March totaled $19.80 billion globally, down over 40% from $33.09 billion for the same month in 2023.
⮞ Venture capital deals were fewer than a year ago, with the number of transactions declining year over year both in March and in the first quarter.
TOP DEALS AND FUNDRAISING
– Vista Equity Partners Management LLC agreed to buy revenue optimization and compliance solutions provider Model N Inc. for about $1.25 billion in cash. The deal is expected to close in mid-2024.
– Madison Dearborn Partners LLC made a nonbinding indicative proposal to buy the remaining shares it does not already own in Australian human and health services provider APM Human Services International Ltd. for A$1.40 per share in cash. Madison Dearborn currently owns about 29% of APM.
– Lone View Capital Management LP secured $850 million for its debut fund. The Lone View Capital Fund I LP will invest in technology businesses.
– Compass Group Management LLC raised $408 million at the close of its Compass Group Fund III. The firm invests in lower-middle-market companies involved in manufacturing and distribution as well as business and consumer services.
– Toyota Ventures LLC pulled in a combined $300 million for its two funds. The Toyota Ventures Frontier Fund II will invest in deep technology startups, while the Toyota Ventures Climate Fund II will target startups that aim to mitigate climate change and promote environmental sustainability.
MIDDLE-MARKET HIGHLIGHTS
– HCAP Partners LLC invested an undisclosed amount in fixture mobilization equipment supplier Gondola Skate Moving Systems Inc.
– Osceola Capital Management LLC recapitalized Trauma Services LLC, a biohazard cleanup and remediation services provider in New England.
– An affiliate of H.I.G. Capital LLC finalized the acquisition of military aircraft maintenance and repair center Segers Aerospace Corp.
FOCUS ON: SOFTWARE PLATFORMS
– National Investment and Infrastructure Fund Ltd. invested about $200 million in India-based digital infrastructure solutions provider Ibus Network & Infrastructure Pvt. Ltd.
– Property management software company Guesty Inc. secured $130 million in a series F round led by KKR & Co. Inc.
– Dutch bid management software company Altura Platform raised €3 million in a seed round led by Curiosity Venture Capital BV.
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For further private equity deals, read our latest In Play report, which looks at potential private equity-backed M&A, including rumored transactions, each week.
Listen to an interview with Ron Kahn, managing director at Lincoln International, who discusses private market valuations and private credit on the Private Markets 360° podcast.
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