S&P Global Market Intelligence offers our top picks of global private equity news stories and more published throughout the week.
Take-private transactions are on the upswing globally in 2024 as private equity firms seek acquisition targets undervalued by public markets. The UK is a prime example.
A trio of megadeals announced since the start of the year has pushed the value of UK public-to-private transactions to $20.68 billion as of Aug. 26, according to S&P Global Market Intelligence data. The year-to-date total is more than the cumulative value of UK public-to-private transactions over the previous two years.
One factor driving the increase in take-privates is the buyer-seller divide that opened in 2022 when interest rates jumped, scrambling views on corporate valuations, including private equity portfolio companies. This prompted buyout fund managers to hold off on exits until market conditions improved, stemming a key source of private equity deals: the sponsor-to-sponsor transactions that involve one private equity firm selling a portfolio company to another private equity firm.
A listed company's share price also gives buyout managers something visible to aim at as they develop acquisition and value-creation plans for publicly traded targets. With private market valuations still relatively murky, this is a big advantage.
Read more about the increase in UK take-private value.
CHART OF THE WEEK: Pandemic redirects venture capital
⮞ The pandemic redirected the flow of venture capital investment into US businesses, with funding round value doubling in at least eight inland states between 2019 and 2023 even as it dropped in coastal states such as California and New York over that same period, according to S&P Global Market Intelligence data.
⮞ The widespread shift to remote work is a factor, with some technology workers relocating away from coastal technology hubs and moving on to found startups in their new communities, Francois Chadwick, leader of KPMG's "emerging giants" group, told Market Intelligence.
⮞ Another factor may be US government efforts to boost domestic manufacturing output and onshore the supply chain, Chadwick said.
TOP DEALS AND FUNDRAISING
– KKR & Co. Inc. completed the purchase of team uniform and apparel company Varsity Brands LLC from Bain Capital LP and Charlesbank Capital Partners LLC.
– G Squared raised $1.1 billion in committed capital at the close of its sixth flagship fund. The G Squared VI LP fund will invest in technology businesses in the secondary market.
– CenterOak Partners LLC secured more than $1.1 billion in total capital commitments at the close of its Centeroak Equity Fund III LP.
– Magnetar Capital Partners LP raised $235 million at the close of its Magnetar AI Ventures Fund LP. The fund will invest in early- to growth-stage AI companies.
MIDDLE-MARKET HIGHLIGHTS
– ICV Partners LLC closed the sale of maritime logistics company Horizon Air Freight Inc. to GHK Capital Partners LP.
– Falfurrias Management Partners LP made a growth investment in cybersecurity company Moxfive LLC.
– Boyne Capital Management LLC, through an affiliate, made an investment in roofing contractor Premier Building Associates LLC.
FOCUS ON: DEFENSE
– Defense technology company Parry Labs LLC secured $80 million in an investment round led by Capitol Meridian Partners LP.
– Gallant Capital Partners LLC sold military engines and accessories maintenance, repair and overhaul provider Aero Turbine Inc. in a deal with The Carlyle Group Inc.-owned StandardAero Inc.
– Montage Partners Inc. invested in Military-Fasteners, a distributor of military specification fasteners.
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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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