S&P Global Market Intelligence offers our top picks of global private equity news stories and more published throughout the week.
Global private equity fundraising got off to a slow start in 2024.
Fundraising is pacing for a 20% year-over-year decline in 2024, with just 704 funds closed between Jan. 1 and June 30 and raising $365.75 billion in total. By comparison, full-year total in 2023 was $919.27 billion, according to fundraising data from Preqin.
There is still plenty of time to close the gap. Looking past the numbers, sentiment among managers with funds in the market appears to be on an upswing as concerns over inflation and interest rates fade, said Fraser van Rensburg, founder and managing partner at placement agent Asante Capital.
The final ingredient to a turnaround in the private equity fundraising market is exits, which remained muted in the first half of 2024, according to S&P Global Market Intelligence data. As M&A and IPO activity picks up and exits improve, an increase in distributions will give private equity investors more cash to roll into new funds.
Read more about private equity fundraising in the first six months of 2024.
CHART OF THE WEEK: Tracking the chatter on earnings calls
⮞ Mentions of inflation and interest rates on earnings calls held by listed private equity firms have fallen off since they spiked in 2022, according to a sentiment analysis by S&P Global Market Intelligence Quantamental Research.
⮞ Private equity executives discussed inflation 33% less in the first quarter of 2024 compared to the same period in 2023, and mentions of interest rates dropped 22% year over year.
⮞ Executive sentiment on the calls improved over the first quarter, suggesting senior management was more at ease as inflation cooled and interest rates stabilized, removing two key impediments to investment activity.
TOP DEALS AND FUNDRAISING
– KKR & Co. Inc., in partnership with Dragoneer Investment Group LLC, agreed to buy all outstanding shares of education company Instructure Holdings Inc. for about $4.8 billion. The all-cash deal includes the shares of majority Instructure owner Thoma Bravo LP.
– A joint venture between KKR and T-Mobile US Inc. is set to buy internet service provider Metronet Holdings LLC. T-Mobile is expected to invest about $4.9 billion, and Oak Hill Capital Management LLC will reinvest and keep a minority stake in Metronet as part of the deal.
– Iconiq Growth raised $5.75 billion at the close of its seventh flagship fund.
– Bregal Sagemount secured $500 million at the close of its debut small-cap fund. The Bregal Sagemount Basecamp I fund will invest $20 million to $75 million in middle-market growth companies.
– Agellus Capital LLC garnered $400 million in capital commitments for Agellus Private Equity Fund I LP at final close.
MIDDLE-MARKET HIGHLIGHTS
– Gridiron Capital LLC signed a deal to sell Good Sportsman Marketing LLC, an outdoor sporting goods company doing business as GSM Outdoors, to Platinum Equity LLC.
– Soundcore Capital Partners LP exited American Restoration Operations LLC, a property restoration services provider, via a sale to Morgan Stanley Investment Management Inc.'s Morgan Stanley Capital Partners fund.
– MPE Mgt. Co. LLC made an investment in industrial products manufacturer LA-CO Industries Inc.
FOCUS ON: FINTECH
– MNT-Halan, an Egypt-based fintech company, raised approximately $160 million in a growth funding round. Investors in the round included International Finance Corp., Apis Partners LLP, Development Partners International LLP, Lorax Capital Partners and Lunate.
– London-based smart money application Plum Fintech Ltd. raised over £16.1 million in its series B funding round. IGrow Venture Partners joined the round, alongside Ventura Capital, Venture Friends and other existing investors.
– Payflow Digital SL, a Madrid-based digital wallet company, raised €6 million in a venture funding round led by Seaya Capital Gestión SGEIC SA, Cathay Capital Private Equity SAS, 6 Degrees Capital and Wayram UK Ltd.
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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.
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