TGP to acquire Angelo Gordon in a $2.7bn deal

BY Richard Summerfield

Private equity (PE) giant TPG has agreed to acquire investment firm Angelo Gordon in a cash and stock deal worth $2.7bn.

Under the terms of the agreement, TPG, an investment firm focused on the credit and real estate markets, will pay approximately $970m in cash and up to 62.5 million units of the TPG Operating Group and restricted stock units of TPG. The acquisition is expected to close in the fourth quarter of 2023, subject to customary closing conditions, including international regulatory approvals and other client and third-party consents.

Angelo Gordon has roughly $53bn in assets under management (AUM), the majority of which are in credit or real estate. Once the deal closes, TPG will be scaling up with $38bn of AUM in real estate alone. As of the end of 2022, the two companies had a combined $208bn in AUM.

“This strategic transaction meaningfully expands our investing capabilities and broadens our product offering,” said Jon Winkelried, chief executive of TPG. “The addition of Angelo Gordon also underscores our continued focus on growing and scaling through diversification, while driving long-term value for our shareholders. Following more than a year of building relationships between the leadership teams of both organizations, we are confident the combination represents a strong strategic and cultural fit and will create additional opportunities for employees of both firms. We look forward to welcoming the Angelo Gordon team as we execute on our shared vision.”

“This is a terrific partnership that provides Angelo Gordon with the scale to capitalize on the growing opportunity set we see in the credit and real estate markets, the diversification to create new solutions for our clients across the risk spectrum in all market conditions, and the opportunity to share our collective expertise, insights, and knowledge,” said Josh Baumgarten, co-chief executive and head of credit at Angelo Gordon.

“We are proud to be joining a world-class investment platform that shares our philosophy on firm culture, investment excellence, and delivering for clients,” said Adam Schwartz, co-chief executive and head of real estate at Angelo Gordon. “This transaction is a testament to the team and business that we have built over nearly 35 years, and we are excited about the new and expanded opportunities ahead for our employees and LPs.”

“Both firms have grown organically over the past three decades, from private founder-led businesses into seasoned firms with next-generation executive leadership poised to accelerate further growth as part of a diversified platform,” added Jim Coulter, co-founder and executive chairman of TPG. “There is a clear alignment of interests, values, and culture with a focus on entrepreneurship, innovation, and investment excellence. We look forward to building on our collective momentum together.”

News: TPG buys $73bn asset manager Angelo Gordon to expand in credit, real estate

Blackstone acquires Cvent in $4.6bn transaction

BY Fraser Tennant

In a transaction which takes the company private, event-software provider Cvent Holding Corp. is to be acquired by Blackstone for approximately $4.6bn.

Under the terms of the definitive agreement, Cvent stockholders will receive $8.50 per share in cash, representing a premium of 52 percent to the volume weighted average share price over the 90 days prior to 30 January 2023 – the day before media reports of a potential transaction were published.

Upon completion of the transaction – which involves Blackstone receiving a fully committed $1bn credit facility as part of its financing – Cvent’s common stock will no longer be publicly listed, and Cvent will become a privately held company.

Founded in 1999, Cvent’s comprehensive suite of technology solutions powers the entire event management process to maximise the impact of events. The company has approximately 22,000 customers globally in the corporate, non-profit, higher education and hospitality sectors.

“The continued events and travel recovery is one of Blackstone’s highest-conviction investment themes,” said David Schwartz, a senior managing director at Blackstone. “Given our extensive experience in the hospitality, events and real estate sectors, we believe Blackstone is well-positioned as a growth partner for this exceptional business.”

Following the recommendation of a special committee composed entirely of independent and disinterested directors, the Cvent board of directors unanimously approved the merger agreement.

“We are excited to share this announcement and look forward to our next chapter alongside the Blackstone team,” said Reggie Aggarwal, founder and chief executive of Cvent. “As one of the world’s largest private equity firms, Blackstone brings deep expertise in the event and hospitality industry, and with their backing, we plan to continue to invest in our business and deliver the innovative solutions that meet our customers’ needs and power the meetings and events ecosystem.”

The transaction is expected to close mid-year 2023, subject to the satisfaction of customary closing conditions, including receipt of approval by Cvent’s stockholders and required regulatory approvals.

Martin Brand, head of North America private equity and global co-head of technology investing at Blackstone, concluded: “Cvent is an industry leader, and we are excited to partner with their management team to continue the firm’s innovation and deliver world-class technology solutions to customers in the event and hospitality space.”

News: Events software provider Cvent accepts Blackstone's $4.6 bln deal

Permira raises €16.7bn Europe-focused fund

BY Richard Summerfield

Leading private equity firm Permira has announced the closing of its most recent flagship buyout fund, Permira VIII (P8), with total capital commitments of €16.7bn.

The fund saw strong demand from investors, closing above its target size of €15bn, which represents around a 50 percent increase in size compared to its predecessor, P7, which closed at €11bn in 2019.

The new fund has already deployed capital across four deals: Mimecast, Zendesk, Reorg and Acuity Knowledge Partners. According to Permira, the new fund will “aim to adhere to specific, fund-level targets relating to climate, gender diversity and governance”, which will be reported on annually throughout the fund’s lifecycle.

With a re-up rate of over 90 percent and over 50 new investors, P8 secured investment from a globally diversified base of leading international investors, including public and private pension funds, sovereign wealth funds, endowments and foundations, institutional fund managers and family offices of entrepreneurs.

“This fundraise is testament to the close relationships we have built with investors over nearly four decades, and an investment strategy that backs rapidly growing companies and highly resilient market leaders,” said Kurt Björklund, managing partner at Permira. “Across both P8 and PGO II, we now have committed capital of more than €20 billion to invest across both our buyout and growth equity strategies. I’d like to thank all of our investors for their continued and unwavering support."

“P8 comes at an exciting time, when we can continue to execute on our thematic, growth-focused investment strategy, whilst also applying it through the lens of values-based investing,” he continued. “We believe the four investments from P8 so far are a clear demonstration of this. We look forward to partnering with outstanding entrepreneurs and management teams to build the leading companies of tomorrow.”

The fund’s close follows the $4bn closing of Permira’s second growth equity fund, Permira Growth Opportunities II, in December 2021, which also beat its target of $2.5bn. The firm believes that the two funds will “enable Permira to invest flexibly across the most compelling investment opportunities globally, whilst leveraging the breadth of expertise available from Permira’s wide network and deep sector expertise”.

The firm has a strong track record of investing in businesses where technology is, or is expected to be, a significant part of their growth trajectory. As such, P8 is expected to see investments in the technology, consumer, healthcare and services sectors.

News: Permira raises €16.7bn for one of Europe’s biggest-ever buyout funds

CD&R acquires Focus Financial Partners in $7bn transaction

BY Fraser Tennant

In a deal that will take it private, fiduciary wealth management firm Focus Financial Partners Inc is to be acquired by affiliates of US private equity firm Clayton, Dubilier & Rice (CD&R) in an all-cash transaction valued at $7bn.

Under the terms of the agreement, Focus’ stockholders will receive $53 in cash per share, representing an approximately 36 percent premium to Focus' 60-day volume weighted average price as of the close on 1 February 2023.

“Focus represents an outstanding collection of leading registered investment advisers (RIAs) and business managers,” said David Winokur, a partner at CD&R. “Our investment is predicated on having greater financial and operating flexibility as a private company in order to support and drive collaboration amongst these entrepreneurial partners.”

Funds managed by Stone Point Capital LLC have agreed to retain a portion of their investment in Focus and provide new equity financing as part of the transaction.

“We are excited to be continuing the journey with the Focus partnership,” said Fayez Muhtadie, managing director of Stone Point. “We firmly believe in the secular tailwinds supporting the wealth management industry and that Focus, as a private company, will be even better positioned to capitalise and continue its track record of growth.”

The board of Focus has approved the proposed transaction on the recommendation of a special committee of all the independent directors of Focus.

“This transaction represents an important evolution in the resources we will have to invest, enabling us to increase the value we deliver to our partners and their clients,” said Rudy Adolf, founder and chief executive and chairman of Focus. “Our diverse and growing partnership creates enduring advantages and we are pleased to have reached an agreement with CD&R that delivers significant immediate cash value to Focus’ stockholders.”

Closing of the transaction – which is expected in the third quarter of 2023 – is subject to stockholder approval, regulatory approvals and other customary conditions.

Mr Adolf concluded: “We are uniquely positioned to capitalise on industry trends while offering the expertise and resources that help our partners provide differentiated service to their clients.”

News: CD&R to take Focus Financial private in over $7 bln deal

Duck Creek acquired by Vista in $2.6bn transaction

BY Fraser Tennant

In a deal that will see it become a privately held company, intelligent solutions provider Duck Creek Technologies is to be acquired by global investment firm Vista Equity Partners in an all-cash transaction valued at approximately $2.6bn.

Under the terms of the definitive agreement, Duck Creek shareholders will receive $19 per share in cash, which represents a 46 percent premium to Duck Creek’s closing stock price on 6 January 2023.

The merger agreement with Vista Equity Partners was approved following the recommendation of a special committee of the Duck Creek board of directors.

“This transaction is a testament to the value of the Duck Creek platform, the success of our strategy and the strength of our incredible team,” said Michael Jackowski, chief executive of Duck Creek. “Following a deliberate and thoughtful process, the board approved this transaction which delivers a great outcome for Duck Creek’s shareholders, providing them a certain and substantial cash value at an attractive premium.”

The deal terms of the merger agreement include a ‘go-shop’ period expiring 7 February 2023, which allows Duck Creek’s board of directors and its advisers to actively initiate, solicit and consider alternative acquisition proposals from third parties.

Founded in 2000 and headquartered in Boston, Duck Creek provides cloud-based property and casualty insurance solutions to its customers including Berkshire Hathaway Specialty Insurance and American International Group.

“Duck Creek is playing an outsized role in accelerating cloud strategies and unlocking all the advantages they provide this crucial sector of today’s economy,” said Monti Saroya, senior managing director and co-head of Vista’s flagship fund. “Duck Creek’s modern cloud architecture and demonstrated market traction position it to define the next generation of mission-critical technology for P&C insurance.”

The transaction is expected to close in the second quarter of 2023, subject to the satisfaction of customary closing conditions, including approval by Duck Creek’s stockholders and US antitrust clearance.

“Vista has an established track record of partnering with leading enterprise software businesses within the insurance industry and related verticals,” concluded Jeff Wilson, managing director at Vista. “We are excited to work with the Duck Creek team as we look to build on their best-in-class platform and solutions, which serve many of the world’s leading P&C insurance carriers.”

News: Vista to take Duck Creek Technologies private in $2.6 bln deal