Longer lull expected in EP-backed M&A; cryptocurrency investment stumbles

S&P Global Market Intelligence offers our top picks of global private equity news and more released throughout the week.

Partners Group Holding AG CEO David Layton said bback in July he expected the slowdown in private equity-backed mergers and acquisitions activity to “last through the end of the summer.” This deadline has been extended.

Layton added three to six months to his prediction when Partners Group released its first-half results on Aug. 30. Market volatility since the start of the year has raised questions about valuations that have yet to be resolved, he said.

“I wouldn’t say there’s a robust market of buyers and sellers that are sort of on the same page,” Layton said. “I think we’re still at the end of sellers able to sell yesterday’s prices because there are still aggressive buyers. But I don’t think we’re far off either. I think we’re maybe- be a quarter or two away from having a more reasonable discussion in their eyes.”

Layton was answering an analyst’s question about the timing of new investments, but this disconnect between buyers and sellers has also slowed the pace of exits, with Partners Group delaying portfolio company sales that would otherwise have taken place in the first half. This affects the results of the listed Swiss asset manager.

Learn more about the impact of the M&A slowdown on Partners Group’s performance fees and first-half revenue.

CHART OF THE WEEK: PE investments in blockchain, cryptocurrency drag

⮞ Falling cryptocurrency prices and impending regulation have dampened private equity activity in the space so far in 2022.

⮞ The value of global transactions nearly halved in the second quarter compared to the same period in 2021, to a total of $2.7 billion.

⮞ Private equity and venture capital firms invested $16.65 billion in cryptocurrency and blockchain in 2021, an industry record.

FUNDRAISING AND OFFERS

* Bain Capital Pvt. Equity LP has agreed to buy Evident Corp., the life sciences and industrial solutions business of Olympus Corp., for approximately $3.11 billion. The transaction is expected to close in the first quarter of 2023.

* Funds managed by affiliates of Apollo Global Management Inc. will sell tower platform and custom build provider Parallel Infrastructure LLC to Harmoni Towers LLC, a portfolio company of Palistar Capital LP. The deal is expected to be finalized in the third quarter.

* Genstar Capital LLC completed the acquisition of Numerix LLC, which is a financial markets risk management technology company.

* TPG Capital LP’s The Rise Fund and Norwest Venture Partners led the $110 million Series D funding round for India-based consumer lending financial technology group Early Salary Pvt. ltd. Piramal Capital & Housing Finance Ltd., the existing investor in EarlySalary, also joined the round.

ELSEWHERE IN THE INDUSTRY

* RedBird Capital Partners LLC has completed the acquisition of AC Milan for 1.2 billion euros. As part of the deal, New York Yankees owner Yankee Global Enterprises LLC has taken a minority stake in the Italian soccer club.

* Levine Leichtman Capital Partners LLC has completed the sale of Monte Nido & Affiliates LLC, which provides treatment programs and services for people with eating disorders, to funds managed by Revelstoke Capital Partners LLC.

* Blue Point Capital Partners LLC has closed Water Lilies Food LLC, a manufacturer and distributor of frozen foods.

* Incline Equity Partners has acquired NovaVision Inc., a security and authentication consumables company.

FOCUS ON: EDUCATION

* Thoma Bravo sells Frontline Education, a provider of administration software to K-12 educators, to Roper Technologies Inc. The deal, which values ​​the target company at around $3.73 billion, could close in the fourth quarter.

* Discovery Education Inc., a portfolio company of Clearlake Capital Group LP, has completed the acquisition of Pivot Interactives SBC, which develops cloud-based activities and labs for students.

* Anchorage Capital Partners has signed a conditional agreement to buy Lollipops Educare Holdings Ltd. to Evolve Education Group Ltd. for an enterprise value of approximately NZ$46 million. The deal is expected to be completed by the end of September.

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