Private Equity

The Exchange: Guy Hands on private equity’s future

15 Dec 2020

The British buyout baron, best known for his disastrous purchase of music group EMI in 2007, now focuses on more modest deals. He joins Liam Proud to discuss Covid-19, ESG, and why the private equity industry’s returns are likely to fall.

Corona Capital: New York City, Fed/climate change

15 Dec 2020

Concise views on the pandemic’s corporate and financial fallout: New York City’s exodus puts local government in a tight spot; the Fed’s belated move shows a change in Washington.

EQT’s $2.8 bln pharma bet relies on sales booster

14 Dec 2020

The Swedish buyout firm is buying manufacturer Recipharm, which handles outsourced production for drug giants like Moderna. Given the target’s already heavy borrowings, delivering a decent return for EQT’s investors will depend on ramping up revenue growth.

Corona Capital: U.S. imports

8 Dec 2020

Concise views on the pandemic’s corporate and financial fallout: U.S. consumers’ demand for products used at home help boost China’s shipments.

Judge Europe’s tech push in 2030, not 2020

8 Dec 2020

The bloc’s startups will raise $41 bln this year, venture firm Atomico reckons. It’s a fraction of America’s haul, and the region’s companies are still tiny by U.S. standards. Europe’s share of early-stage fundraising, however, is huge. That augurs very well for the future.

Blackstone’s SPAC foray puts price on convenience

7 Dec 2020

Payments company Paysafe is merging with a listed acquisition vehicle, while owners Blackstone and CVC halve their stake and extract $2.3 bln of cash. The cost to them is that they’ll leave roughly 15% on the table. Even so, it’s easy to see why SPACs tick private equity’s boxes.

BC Partners finds awkward fix for low-tech buyouts

7 Dec 2020

After three failed IPOs, the private-equity firm may sell publisher Springer Nature to a new fund it controls for 6 bln euros, the FT says. It’s messy, but probably better than a botched listing. With public investors wary of sluggish assets, other deals may face a similar fate.

Activist minnow needs bigger fish to fry Exxon

7 Dec 2020

The $176 bln oil major has rarely listened to past investor pleas, so demands from a $40 mln stakeholder seems a non-starter. Yet its recent record of capital destruction may be enough for bigger funds to join in. Taking on the oil giant is a way to justify ESG lip service, too.

Corona Capital: Airbnb IPO, IKEA catalog

7 Dec 2020

Concise views on the pandemic’s corporate and financial fallout: Vacation-rental app Airbnb ups its likely market valuation when it goes public later this week; and IKEA kills off its doormat-denting printed catalog after 70 years.

Davos set can easily make do in Singapore

7 Dec 2020

The city state makes for a decent approximation of the Swiss enclave to host the annual World Economic Forum gathering. It’s clean, safe, a private wealth hub and neutral enough. With the future billionaire class emerging from Asia, it might even suit as more than a stopgap site.

Macquarie plays it safe with U.S. takeover

3 Dec 2020

The Aussie financial conglomerate is buying asset manager Waddell & Reed for $1.7 bln in Shemara Wikramanayake’s first big deal since becoming CEO two years ago. It expands a business in her wheelhouse at a reasonable price. There is cleanup work to do, but it ticks enough boxes.

India adds distress to distressed debt deals

25 Nov 2020

Tycoon Gautam Adani narrowly outbid U.S.-based Oaktree with a $4 bln bid for insolvent housing lender DHFL. The offer, however, was submitted late and cheekily expanded on its original plan. It’s the second time the industrialist has blindsided foreign buyers in a worrying trend.

Blackstone suited to be Crown buyer of last resort

23 Nov 2020

Regulators suspended the Aussie casino operator’s gaming licence for a new luxury Sydney complex. That darkens the clouds over James Packer’s embattled $5 bln empire. The buyout shop is already an investor and knows a thing or two about buying and breaking up real estate groups.

Italian sovereign fund is a force to reckon with

20 Nov 2020

Fabrizio Palermo has turned 170-year-old CDP into a deal machine. Through his activism, Rome snagged stakes in Euronext and fintech star Nexi. If he gets another term as CEO, the urge to build champions won’t ebb. But the fund must prove it can keep politics at arm’s length.

Nexi bulks up for next round of payments M&A

16 Nov 2020

The Italian group’s 7.8 bln euro swoop on rival Nets, following its takeover of Sia, turns it from prey into predator. With a likely market value of around 22 bln euros, Nexi will compete with French rival Worldline for future deals. Bank-owned payment assets are the next target.

Walmart sale is nod to Japan’s online Suga rush

16 Nov 2020

The U.S. retailer is selling control of its Japanese supermarkets to KKR in a $1.7 bln deal. Rakuten is piling in too. The pair are well placed to get shoppers online as Prime Minister Yoshihide Suga pushes digitisation. Walmart is smart to stick around as a minority investor.

Credit Suisse nexus may underpin Aussie deal

3 Nov 2020

U.S. investment firm Ares has provisionally offered $4.5 bln for embattled wealth manager AMP. Both the seller and suitor count alums from the Swiss bank among their senior ranks. Cosy connections could prove useless, though, if the approach kicks off a full-blown bidding war.

Apollo would carry on just fine without Leon Black

28 Oct 2020

The 30-year-old investment shop is under intense scrutiny because of revelations about its co-founder’s dealings with the late sex offender Jeffrey Epstein. At this stage, credit eclipses buyouts anyway. And the firm has deepened its bench enough to move forward without Black.

Wicked big Dunkin’ deal more saccharine than sweet

26 Oct 2020

The Massachusetts coffee-and-donuts chain looks set to be gobbled up by Arby’s-and-Sonic owner Inspire Brands for $9 bln. Dunkin’ weathered the pandemic well enough. But the valuation is as gut-busting as one of its French crullers, and restaurant roll-ups are light on synergies.

Joe Biden is private equity’s tax boogeyman

26 Oct 2020

The White House wannabe aims to eradicate the perk that mints money for buyout barons. His broader plans would add to the pain for firms like Blackstone and KKR which restructured to exploit Donald Trump's tax cuts. Shareholders, clients and staff could end up at loggerheads.