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EQT Private Equity to acquire Zeus, a global leader in advanced polymer components used in life-saving medical procedures

eqt
  • EQT Private Equity to acquire Zeus, a leading supplier of custom polymer components to the world’s most innovative medical device and industrial companies
  • Transaction highlights EQT’s commitment to partnering with leading, purpose-driven companies that deliver inherently critical services to society. Zeus uses its material science expertise to develop advanced components for medical devices used in minimally invasive, life-saving procedures
  • EQT will support Zeus through investments in additional production capacity, R&D, and operational excellence

The EQT X fund (“EQT”) and Zeus Company, Inc., today jointly announced that they have entered into an agreement for EQT to acquire Zeus Company Inc (“Zeus” or the “Company”) from the Tourville family. Founded in 1966, Zeus is a pioneer in the design, development, and extrusion of fluoropolymer tubing for medical devices and select industrial applications. EQT also announced that John Groetelaars, former CEO of Hillrom and EQT Industrial Advisor, will serve as Zeus’ Executive Chairman upon closing of the transaction.

For more than 50 years, Zeus has delivered innovative and mission-critical components that improve the efficacy and performance of highly complex catheters, which are used in life saving, minimally invasive medical procedures, among other applications. The Company is headquartered in Orangeburg, South Carolina, with eight facilities across the United States and one in Letterkenny, Ireland. Zeus employs approximately 2,400 people globally and serves over 300 customers in more than 100 countries, including leading medical device manufacturers, contract device manufacturing organizations, academic institutions, and industrial customers across aerospace, semiconductors, and automotive, among other industries.

Zeus’ components enable the delivery of minimally invasive interventional procedures, which drive significantly better health outcomes than traditional open surgeries, including faster patient recovery and reduced pain, at lower cost. Zeus has experienced substantial growth as a leading innovator in polymer-based solutions. As populations age and chronic conditions become more prevalent, increasing demand for precision, high-performance catheters to support therapeutic areas including structural heart, peripheral and neurovascular interventions, is expected to continue fueling Zeus’ growth.

EQT will support Zeus with investments in additional capacity, R&D, and operational excellence, to support the rapidly growing medical fields that leverage minimally invasive technologies. These investments will enable the Company to continue its legacy and reputation of partnering with its clients’ research and development groups to remain at the forefront of next generation technologies.

Ethan Waxman, Partner within EQT Private Equity’s Advisory Team, said: “EQT has tracked the medical device component industry closely for several years, and we believe Zeus is uniquely positioned within the end markets it serves due to its unmatched material science and process expertise. We are excited to partner with the Company and invest in its next phase of growth, its employees, and the communities it serves, while maintaining Frank Tourville Sr.’s values and commitment to excellence, which are shared by EQT.”

Steve Peterson, President and CEO of Zeus, added: “We are excited to join the EQT family. Zeus has gained significant momentum in recent years due to a strategic global expansion plan. This acquisition accelerates that momentum and growth by supporting future expansion, new product innovation, process improvements, technological transformation, and enhanced capabilities.”

John Groetelaars said: “I am thrilled to embark on this journey with Zeus and EQT to build upon the Company’s impressive legacy and best-in-class, differentiated product portfolio. We are committed to strengthening the partnerships with the customers that Zeus serves and expanding capacity through investments, operational upgrades, and growth from new product innovations. In the near-term, we intend to expand facilities and add personnel to increase production on behalf of our customers, and we’re excited to maintain our status as a key employer in the communities where we operate.”

“As one of the world’s leading healthcare investors, EQT invests in innovative companies that are addressing some of the most significant challenges in healthcare today, ranging from life science startups to scaled global businesses,” said Eric Liu, Partner, Head of North American Private Equity and Co-Head of Global Healthcare. “This acquisition represents a highly thematic investment for EQT, given our longtime focus on the medical technology industry and our experience partnering with family-founded businesses. With EQT’s deep expertise and broad network of advisors in the healthcare sector, we look forward to continuing our track record of creating differentiated value for all stakeholders.”

The transaction is expected to close in Q1 2024, subject to regulatory approvals and customary closing conditions.

Piper Sandler Companies acted as financial advisor to EQT Private Equity and Simpson Thacher & Bartlett LLP provided legal counsel. Goldman Sachs & Co. LLC acted as financial advisor to Zeus and Freshfields Bruckhaus Deringer LLP provided legal counsel. The Private Credit business within Goldman Sachs Asset Management will serve as the Administrative Agent and lead lender in the Senior Secured financing to support the transaction.

With this transaction, EQT X (target fund size of EUR 20.0 billion and a hard cap of EUR 21.5 billion) is expected to be 25-30 percent invested (including closed and/or signed investments, announced public offers, if applicable, and less any expected syndication) based on its target fund size.

The information contained herein does not constitute an offer to sell, nor a solicitation of an offer to buy, any security, and may not be used or relied upon in connection with any offer or solicitation. Any offer or solicitation in respect of EQT X will be made only through a confidential private placement memorandum and related documents which will be furnished to qualified investors on a confidential basis in accordance with applicable laws and regulations. The information contained herein is not for publication or distribution to persons in the United States of America. Any securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold without registration thereunder or pursuant to an available exemption therefrom. Any offering of securities to be made in the United States would have to be made by means of an offering document that would be obtainable from the issuer or its agents and would contain detailed information about the issuer of the securities and its management, as well as financial information. The securities may not be offered or sold in the United States absent registration or an exemption from registration.

Contact
EQT: Mathilde Milch, Director, Communications, Mathilde.milch@eqtpartners.com, +1 917 510 6626
Zeus: Jennifer McQuesten, VP of Corporate Communications, jmcquesten@zeusinc.com, +1 480 200 5488

About EQT
EQT is a purpose-driven global investment organization with EUR 232 billion in total assets under management (EUR 128 billion in fee-generating assets under management), within two business segments – Private Capital and Real Assets. EQT owns portfolio companies and assets in Europe, Asia-Pacific and the Americas and supports them in achieving sustainable growth, operational excellence and market leadership.

More info: www.eqtgroup.com
Follow EQT on LinkedIn, X, YouTube and Instagram

About Zeus
Zeus, headquartered in Orangeburg, South Carolina, is the world’s leading polymer extrusion and catheter design manufacturer. With over 55 years of experience in medical, aerospace, energy, automotive, fiber optics, and other leading industries, Zeus’ mission is to provide solutions, enable innovation, and enhance lives. The company employs over 2,400 people worldwide with facilities in Aiken, Columbia, Gaston, Orangeburg, and St. Matthews, South Carolina; Branchburg, New Jersey; Chattanooga, Tennessee; San Jose, California; Arden Hills, Minnesota; Guangzhou, China; and Letterkenny, Ireland. For more information, visit www.zeusinc.com.

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ETCHE sells the Gallic Portfolio, consisting of five assets in the Lyon Region

KKR

Paris, 18 December 2023 – Etche, KKR’s logistics real asset platform in France, has sold a portfolio of five assets located in the Lyon region, with a total area of approximately 29,000 square meters.

Situated on the outskirts of Lyon, in Meyzieu, Saint-Quentin-Fallavier, Saint-Priest, Décines-Charpieu, and Chassieu, the portfolio consists of five commercial and logistics buildings strategically located in prime logistics zones that serve the city of Lyon and its surrounding area. The buildings are fully leased to national and local brands.

Vincent Lauret, President of Etche, commented: “This latest sale ends an extremely active year for Etche, and demonstrates our ability to continue creating value in the sectors we are focused on, including logistics. In the midst of a challenging market environment, we have successfully completed a quick sales process without compromising on our ambitious value objectives, reflecting the quality and prime location of this portfolio and our focus on active asset management since acquiring the buildings.”

The Gallic assets were acquired between 2021 and 2022 through KKR Real Estate Partners Europe II, the same European value-add strategy used for the Big Deal portfolio. This portfolio, sold to Alderan earlier this year, comprised of 29 business park and logistics assets spread across France.

Etche also sold its retail assets this year, while also continuing to acquire strategically located buildings. In October, Etche announced the acquisition of the Scott portfolio from Ivanhoé Cambridge, comprising five buildings strategically located in prime logistics zones in the ‘Dorsale’ on the outskirts of Lyon, Grenoble, Orléans, Compiègne and Strasbourg. The acquisition was Etche’s first transaction in France through KKR’s European Core+ real estate strategy, which focuses on investing in high quality, substantially stabilised assets with medium-term value growth potential.

For the sale of the Gallic portfolio, Etche engaged commercial advisers JLL and CBRE, legal advisor Lacourte Raquin Tatar, and the notary office R&R Notaires.

—

About Etche
Founded in 2010, Etche is a French private real estate asset management company owned by the global investment company KKR. With a portfolio of around forty assets throughout France in corporate real estate (business parks, industrial, and logistics), Etche is currently refocusing its activities to prioritize logistics real estate through arbitrages or the acquisition of existing or planned buildings. With a strongly affirmed ESG strategy, the company has initiated an ambitious decarbonization plan for its heritage, encouraging its suppliers and collaborators to identify more environmentally friendly innovative solutions.

About KKR
KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com. For additional information about Global Atlantic Financial Group, please visit Global Atlantic Financial Group’s website at www.globalatlantic.com.

Media contacts

ETCHE
Iduskia Communication
Grégoire Darricau – +33 6 72 10 58 57 – gdarricau@iduskia-communication.com

KKR
FGS Global
Laura de Carné – +33 7 89 07 82 73 – laura.decarne@fgsglobal.com

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Eurazeo enters into exclusive discussions with Carl Zeiss Meditec AG to sell its stake in DORC

Eurazeo

Eurazeo and its affiliates have entered into exclusive discussions to sell DORC (“Dutch Ophthalmic Research Center”) to Carl Zeiss Meditec AG for an enterprise value of approximately €1bn. The Eurazeo Mid-large buyout team1 has been supporting the company as a majority shareholder since 2019 and under its ownership, DORC has become one of the world-leading ophthalmic surgery platforms leading the growth game in the Vitreoretinal (“VR”) and Cataract market.

Under the terms of this agreement, the transaction is expected to yield over 2.6x gross cash on cash and 24% gross internal rate of return (IRR) on its original investment, including proceeds of the refinancing closed in December 2021. Upon closing of the transaction, c.€385m of gross proceed would be returned to Eurazeo balance sheet. Closing of the transaction remains subject to completion of the relevant information and consultation process with the employee representative body of the company and applicable regulatory approvals.

Established in 1983, and headquartered in the Netherlands, DORC is a world-leading and high growth ophthalmic surgery platform benefiting from a strong global market position as #2 player in VR packs2 and #1 player in dyes. The company has developed a high-quality and innovative product offering which includes EVA Nexus™, the most advanced dual-function system. In 2023, the Company is expected to deliver €200m net sales with an installed base of over 2,100 systems placed worldwide supported by an organization of over 750 FTEs.

As part of our conviction-driven and sector-focused investment strategy, we identified DORC as a compelling investment opportunity and highly resilient business, with a recurring razor-razor blade revenue model and strong potential for value creation leveraging the Eurazeo’s playbook.

Over the last four years, the company has achieved strong growth underpinned by a bolstered management team strengthening DORC’s sectorial expertise and scale, intensified international expansion strategy with the setup of Chinese operations and approval and launch of EVA Nexus™ in 2022. DORC continued to invest in innovation and R&D driving market leading vitality index3 over 25% and successful completed two strategic acquisitions in Germany and the US. As a result, DORC has increased its strategic value and attracted the interest from a variety of strategic buyers including Carl Zeiss Meditec AG.

Carl Zeiss Meditec AG is one of the world’s leading medical technology companies, headquartered in Germany with a focus on ophthalmology and microsurgery. The company offers complete solutions, including implants and consumables, to diagnose and treat eye diseases. The acquisition of DORC will enhance and complement Zeiss’ broad ophthalmic portfolio and expand its position in the VR surgery segment, further strengthening its position as the fastest growing manufacturer of ophthalmic devices globally.

 

Pierre Billardon, DORC CEO stated:

“ In the year when DORC celebrates 40 years of surgeon-inspired innovation in ophthalmic surgery, we enter a new phase of exciting potential for growth and advancing the future of ophthalmic surgery. I am personally proud and immensely grateful to all of the team at DORC for their expertise and commitment to help patients see again. “

 

Francesco Orsi, Managing Director – Mid-large buyout commented:

” We are proud of our partnership with Pierre Billardon and the DORC team to deliver on a shared vision to establish DORC as a world-leading and high growth ophthalmic surgery platform spearheading the fast-growing Dual market segment with the recently launched state-of-the art EVA Nexus™. Over the past four years, the Company has not only delivered on its innovation DNA but has significantly scaled internationally, including in the US and Asia, and unlocked further strategic value through two highly synergistic acquisitions. “

 

Dr. Markus Weber, President and CEO of Carl Zeiss Meditec AG said:

” With the acquisition of DORC, we’ll bring together two highly innovative ophthalmic powerhouses to accelerate Zeiss’s position in the vitreoretinal surgery segment and extend our leadership in the ophthalmic medical devices market. “

*********************

(1) Part of the Eurazeo Mid Cap company
(2) Excluding China
(3) Share of DORC’s sales originating from new products

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Xalient acquires Grabowsky, a leading Digital Identity specialist in Europe, accelerating its global leadership position.

Volpi Capital

The Volpi Capital team are delighted to announce Xalient’s acquisition of Grabowsky, a leading independent specialist provider of Identity Access Management (“IAM”) consulting and managed services operating in the Benelux region.

It represents a highly strategic and an immediately accretive acquisition for Xalient; allowing it to enhance its relationships with global IGA and PAM software vendors and accelerate the launch of a complementary managed service practice to serve an enlarged customer pool.

Along with US-based Integral Partners, Grabowsky marks the second acquisition for the Xalient Group inside 6 months and it is another great example of Volpi strengthening a portfolio company’s specialist capabilities and broadening its European reach, accelerating its global leadership position. Our focus now fully shifts to integrating the three businesses and realising cross-sell synergies.

With a significant presence in the Netherlands, Belgium, and Luxembourg markets and a strong customer base in both public and private sectors, Grabowsky brings extensive IAM capabilities, which include Identity Governance Administration (IGA), Privileged Access Management (PAM), and Customer Identity Access Management (CIAM). Xalient is now uniquely positioned to provide its clients with a comprehensive global IAM service because of its unmatched identity expertise in the US, UK, and now the Benelux region. With these two acquisitions, Xalient now boasts over 300 employees worldwide.

Sherry Vaswani, CEO and founder of Xalient, emphasises the deal’s strategic importance. “We’re delighted to welcome Grabowsky into the Xalient family. Grabowsky boasts an excellent reputation in the industry with both partners and clients. Importantly, Grabowsky reflects our own company ethos to provide customer-centric solutions, designed and delivered by trusted experts.”

Steven Daniëls, Managing Director, Grabowsky adds: “Having specialised in and delivered IAM technologies and services for the past 38 years, it’s clear the IAM domain as we know it today is too siloed for the IT landscape of tomorrow. With identities dispersed across the identity, cybersecurity, and networking domains, managing them becomes complex and obscure. This underscores the need for a Zero Trust approach to govern access for all identities. As a result, we are delighted to join the Xalient Group. Our shared values and ambition, combined with the complementary nature of our services, meant that Xalient was the obvious choice to help us evolve on a global footing.”

Mark Cooke, Chief Operating Officer, Xalient commented: “We’re seeing growing global demand for IAM strategies and solutions, driven in part by the increased protection needed around digital transformation initiatives. Customers are increasingly recognising the interdependencies between identity security and networking in order to achieve true Zero Trust and are turning to specialist providers like Xalient. This acquisition broadens our geographic reach throughout Europe and puts us in a strong position as we embark on our next growth phase.”

Elizabeth Griskova Ruocco, Investor at Volpi Capital concluded: “This is a highly accretive acquisition for Xalient, allowing us to strengthen our presence in Continental Europe and offer extended consulting, delivery, and managed services in Identity Access Management. We are excited to be partnering with Steven and the team and look forward to realizing the many synergies between the 3 businesses”.

The Volpi team was led by Scott Fairlie, Elizabeth Griskova Ruocco and Marc Andreoli.

About Xalient

To learn more about Xalient and its services, visit www.xalient.com

Headquartered in the UK and with offices in the USA, Xalient counts Kellogg’s, Avis Budget Group, WPP and Keurig Dr Pepper among its clients. It was established eight years ago to disrupt the traditional markets for secure networking, taking advantage of the huge shift to cloud technology that has created high demand for flexible, cost-effective global connectivity and protection against increasingly complex cyber threats. Following the strategic acquisition of Integral Partners earlier this year, Xalient offers world-class Advisory, IGA, PAM, PAM, Customer Identity, Access Enforcement and IAM solutions, as well as transformative software-defined networking, cybersecurity technologies and managed services. Xalient helps the world’s largest brands become more resilient, adaptable, and responsive to change.

*Xalient was named among Europe’s Fastest Growing Companies in 2023 by Financial Times and Statista for the second year running.

About Grabowsky

To learn more about Grabowsky solutions and services, please visit www.grabowsky.com.

Based in The Hague, Grabowsky is a leading expert in the Digital Identity (IAM) field. With over 35 years of experience, Grabowsky enhances the digital resilience and agility of organisations across Europe. Its knowledge, expertise, and innovative approach have earned Grabowsky a prominent position in the industry and many reputable awards. The company’s mission is to facilitate seamless and secure collaboration among all digital identities within and between organisations.

*Grabowsky was awarded SailPoint 2022 EMEA Admiral Delivery Partner of the Year for Software and SaaS (Software as a Service) and CyberArk’s EMEA Growth Partner of the Year Award 2022,

About Volpi Capital

Volpi Capital is a specialist Pan-European lower mid-market private equity firm seeking to partner with ambitious businesses that use technology to disrupt traditional B2B value chains. Volpi typically invests €25-75 million of equity in businesses with enterprise values between €50 million and €200 million and seeks to drive transformative growth through international expansion and consolidation. The firm, which was founded in 2016 by Crevan O’Grady and Marco Sodi, closed its second fund (Volpi Capital Fund II) in December 2020 with €323 million of commitments, and is now investing from its third fund (Volpi Capital Fund III)

Media enquiries Volpi Capital
Samantha Lang
Public Relations
+44 203 747 2625
info@volpicapital.com

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KKR Acquires $7.2 Billion Portfolio Of Prime Recreational Vehicle Loans

KKR
December 15, 2023

NEW YORK–(BUSINESS WIRE)– KKR, a leading global investment firm, today announced that funds and accounts managed by its credit business have led the purchase of a $7.2 billion portfolio of super-prime recreational vehicle (RV) loans from BMO Bank National Association, part of BMO Financial Group (“BMO”). Concurrently with the sale, BMO purchased approximately $6.4 billion of senior notes collateralized by the sold loans. BMO will remain the servicer of the loans and will continue to originate and manage RV loans, with no expected impact to dealers, borrowers, and employees.

This transaction aligns with KKR’s Asset-Based Finance (ABF) strategy, which focuses on privately originated and negotiated credit investments that are backed by large and diversified pools of financial and hard assets, offering diversification to traditional corporate credit and attractive risk-adjusted returns. KKR has made 73 ABF investments globally since 2016 through a combination of portfolio acquisitions, platform investments and structured investments. The firm has approximately $47 billion in ABF assets under management and a team of more than 50 professionals directly involved in the ABF effort globally.

“This investment directly highlights the strength and scale of our Asset-Based Finance business, which has experienced unprecedented growth alongside the rapid expansion of this market,” said Dan Pietrzak, Global Head of Private Credit at KKR.

“We look forward to continuing to build on our 30-year history as a leading provider of consumer financing in the recreational market and strong network of dealer relationships across the United States,” said Tami Farrow, Head U.S. Indirect Lending. “This transaction enables us to further optimize BMO’s balance sheet to support future growth across the bank.”

“We are proud to serve as a strategic partner to banks as they focus on optimizing their balance sheets” said Avi Korn and Chris Mellia, Co-Heads of U.S. Asset-Based Finance at KKR. “We believe this portfolio of high-quality, fixed rate assets is a strong fit for our long-term private capital and yet another example of the compelling opportunity set that we’re seeing in Asset-Based Finance.”

KKR’s investment comes from its credit funds and accounts. Kennedy Lewis Investment Management LLC also participated in the transaction, alongside KKR and other investors.

About KKR

KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com. For additional information about Global Atlantic Financial Group, please visit Global Atlantic Financial Group’s website at www.globalatlantic.com.

About BMO Financial Group

BMO Financial Group is the eighth largest bank in North America by assets, with total assets of $1.3 trillion as of October 31, 2023. Serving customers for 200 years and counting, BMO is a diverse team of highly engaged employees providing a broad range of personal and commercial banking, wealth management, global markets and investment banking products and services to 13 million customers across Canada, the United States, and in select markets globally. Driven by a single purpose, to Boldly Grow the Good in business and life, BMO is committed to driving positive change in the world, and making progress for a thriving economy, sustainable future, and inclusive society.

Media
Julia Kosygina
212-230-9722
media@kkr.com

Jeff Roman
Jeff.roman@bmo.com

Source: KKR

 

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KKR Releases 2024 Global Macro Outlook

KKR

Henry McVey: Investors Should Approach Markets with a ‘Glass Half Full’ Lens

NEW YORK–(BUSINESS WIRE)– KKR, a leading global investment firm, today released its 2024 Global Macro Outlook by Henry McVey, CIO of KKR’s Balance Sheet and Head of Global Macro and Asset Allocation (GMAA).

In “Glass Half Full,” McVey and his team maintain a constructive tilt on the investing landscape for 2024, despite ever-present geopolitical and macroeconomic headwinds. They note that there is still a significant amount of dispersion within and across asset classes that long-term investors can harness to create substantial value. They also note that, while they continue to believe that inflation will remain higher for longer, they expect a temporary disinflationary impulse in the first six months of 2024, which could create opportunities for short-term investors to lean into fixed income instruments.

The following key tailwinds underpin the GMAA team’s continued constructive view in 2024:

  • Central Bank balance sheets, which are still near record levels, are creating a cushion that is helping support asset prices, especially during periods of market stress.
  • We still believe the bear market in Equities ended in October 2022. Returns tend to be above average after a 25% decline in the S&P 500 for the next five to seven years.
  • We think earnings for this cycle bottomed in Q2 2023, despite our forecast for significantly slower nominal GDP in 2024.
  • The technical bid for parts of Credit and Equities remains compelling, as new issuance remains near record lows.
  • We believe central banks are closer to ending their tightening campaigns, which should help narrow spreads on cost of capital for deal activity.

Against this backdrop, McVey and his team identify the following key mega-themes that can serve as compelling investment opportunities and hedges in both disinflationary and reflationary environments.

  • Industrial Automation – We are seeing the emergence of an industrial automation cycle, as companies search for new ways to drive productivity and efficiency in a world where demographics and cross-border connectivity are becoming increasingly challenged.
  • Security of Everything – We are still very bullish on this theme as regulators and executives around the world continue to prioritize the resiliency of key inputs such as energy, data, transportation, and pharmaceuticals. We also expect governments to spend more on the intersection of climate and supply chains, and on cybersecurity, especially in the financial services industry.
  • Intra-Asia Connectivity – Asia is becoming more Asia-centric as more trade occurs within the region, a trend that we believe is now accelerating. We also see more countries in the region participating in and benefiting from Asia’s global growth engine.
  • Labor Productivity/Work Force Development – We continue to see labor shortages accelerating the trend towards automation and companies focusing more on technology-driven productivity gains, especially in fields like retail, leisure and hospitality, and health care. We are also bullish on worker retraining to help employee skills better match employer demand.
  • Artificial Intelligence – We think some of the most compelling opportunities in AI are in the buildout of the physical infrastructure that is needed for Generative AI to scale and reach its full potential. This includes data centers, semiconductor manufacturing, power transmission, and distribution, among other areas.
  • Decarbonization – We are particularly bullish on brown-to-green transition across existing corporate and government platforms. These are large scale opportunities that will allow big sectors of the global economy to become more energy efficient.

In addition to the aforementioned insights and themes, the report details the GMAA team’s updated views on growth, interest rates, commodities, currencies, and asset allocation.

Links to access this report in full as well as an archive of Henry McVey’s previous publications follow:

  • To read the latest Insights, click here.
  • For an archive of previous publications please visit www.KKRInsights.com.

About Henry McVey

Henry H. McVey joined KKR in 2011 and is Head of the Global Macro, Balance Sheet and Risk team. Mr. McVey also serves as Chief Investment Officer for the Firm’s Balance Sheet, oversees Firmwide Market Risk at KKR, and co-heads KKR’s Strategic Partnership Initiative. As part of these roles, he sits on the Firm’s Global Operating Committee and the Risk & Operations Committee. Prior to joining KKR, Mr. McVey was a Managing Director, Lead Portfolio Manager and Head of Global Macro and Asset Allocation at Morgan Stanley Investment Management (MSIM). Learn more about Mr. McVey here.

About KKR

KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com. For additional information about Global Atlantic Financial Group, please visit Global Atlantic Financial Group’s website at www.globalatlantic.com.

The views expressed in the report and summarized herein are the personal views of Henry McVey of KKR and do not necessarily reflect the views of KKR or the strategies and products that KKR offers or invests. Nothing contained herein constitutes investment, legal, tax or other advice nor is it to be relied on in making an investment or other decision. This release is prepared solely for information purposes and should not be viewed as a current or past recommendation or a solicitation of an offer to buy or sell any securities or to adopt any investment strategy. This release contains projections or other forward-looking statements, which are based on beliefs, assumptions and expectations that may change as a result of many possible events or factors. If a change occurs, actual results may vary materially from those expressed in the forward-looking statements. All forward-looking statements speak only as of the date such statements are made, and neither KKR nor Mr. McVey assumes any duty to update such statements except as required by law.

Media:
Julia Kosygina
212-750-8300
media@kkr.com

Source: KKR

 

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CVC Asia V acquires 100% of Sogo Medical Group Co., Ltd from Polaris Private Equity Fund V and other shareholders

CVC Capital Partners

CVC Asia V has reached agreement to acquire 100% of outstanding shares of Sogo Medical Group Co., Ltd. (“Sogo”) in mid-Feb 2024 from Polaris Private Equity Fund V (“Polaris Fund V”), managed by Polaris Capital Group Co., Ltd. (“Polaris”), and other shareholders.

Established in 1978 with the founding philosophy: “To contribute to the community and society through supporting quality medical care”, Sogo provides a comprehensive range of services relating to the management of medical practices, including consulting for medical institutions, Doctor-to-Doctor services such as career change support and assistance in launching independent practices, leasing and rental of medical equipment, operation of in-hospital restaurants/kiosks and temporary staffing. Over the years, Sogo has also developed an extensive network of approximately 740 pharmacies nationwide, including the medical malls developed and operated by Sogo to better address local healthcare provision issues. Following Polaris’s management buyout and delisting of Sogo in 2020, the company has fostered its distinctive business model through M&A and launch of Digital business and achieved sustainable growth with a long-term goal of supporting the creation of healthcare systems that enable the public to efficiently access high-quality healthcare. With the transfer of ownership to CVC Asia V, Sogo will continue to focus on key initiatives to provide high value-added functions and services to both medical institutions and patients, while further integrating the two pillars of medical support business and dispensing pharmacy business with digital business.

Yuji Kimura, Founder, President and CEO of Polaris, added: “Polaris has been fully dedicated to enhancing the corporate value of Sogo by leveraging knowledge and experience gained through numerous past investments in the healthcare sector. Over the past 4 years, Polaris has undertaken the pivotal decision to delist Sogo, successfully navigating the unprecedented challenges posed by Covid-19 pandemic and implementing various reforms to propel the company to new heights, unburdened by any constraints. I would like to express my sincere gratitude to everyone at Sogo for their tireless efforts to date and extend my best wishes to all as they embark on the next stage of growth.”

Quotes

We are looking forward to working together with Sogo as one to continue its development and expansion, while making sure we uphold the company’s long-term philosophy.

Atsushi AkaikeManaging Partner and Co-Head of CVC Japan

Atsushi Akaike, Managing Partner and Co-Head of CVC Japan, commented: “We believe that under Polaris’s ownership, Sogo has strengthened its existing businesses and achieved substantial growth. At CVC we have extensive experience of supporting healthcare businesses to achieve their growth ambitions and we are looking forward to working together with Sogo as one to continue its development and expansion, while making sure we uphold the company’s long-term philosophy.”

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CINC Systems secures meaningful strategic investment from Hg to accelerate its growth as a premier software provider to the community association management industry

HG Capital

Hg will become a strategic growth investor in the business alongside CINC’s founder, Bill Blanton, its management team and current investors, Spectrum Equity.

  • The new investment follows a significant year of growth for the business, with record new bookings and 50% revenue growth in 2023.

  • Tom Kiernan, former CEO of ClickPay, will join the Board as part of the transaction, bringing additional industry expertise and relationships, as well as experience in constructing easy-to-use payment platforms for homeowners.

DULUTH, Ga, USA and New York, USA. December 14, 2023. CINC Systems (“CINC”), a leading cloud-based software company serving the community association management sector, today announced it has secured a strategic growth investment from Hg, a leading investor in European and North American software and services businesses.

On completion of the transaction, Hg will become a strategic shareholder in the business, investing alongside CINC’s founder, Bill Blanton, and its management team, as well as current investors Spectrum Equity.

CINC is a leading provider of accounting, homeowner management, bank integrations and payments software for the association management industry, comprised of homeowner association (“HOA”) and condominium associations. Founded in 2005, CINC has built a leading SaaS platform for this sector, serving more than 4 million units across about 35,000 associations and nearly 800 management companies, with deep integrations and strategic partnerships with more than 30 partner banks.

CINC recently announced the launch of several ground-breaking innovations for the industry at its annual user conference CINC Up, including the introduction of artificial intelligence (“AI”) in its management company-branded homeowner apps. The technology allows homeowners to use their apps to ask simple questions that bog down association managers – and receive informed answers in return.

Bill Blanton, CINC Systems Founder and Chairman, said: “I’m proud that our achievements have attracted the attention of two globally renowned SaaS-specialist investors. The addition of Hg’s expertise in expanding top-tier software businesses, complemented by Spectrum’s support, places us in an advantageous position to keep innovating our products to better serve our clients, add new clients and expand our reach.”

Ryan Davis, Chief Executive Officer of CINC Systems, said: “This is a really exciting day for us all. With Hg’s expertise, our foundation in this sector is now stronger than ever. The wealth of experience and knowledge that this collaboration brings, puts us in the perfect position to innovate and augment our product.”

CINC has scaled rapidly in recent years, investing to ensure fast-paced product innovation, a robust customer success team and enhanced sales and marketing efforts. This has resulted in a significant year of growth in 2023, with record new bookings and approximately 50% revenue growth. Today, its all-in-one software, bank integration and payments technology solution adds significant value to all participants in the HOA ecosystem, with more than $7 billion of annual payment volume being managed through its platform.

Hg brings significant sector expertise to CINC. Over the last 19 years, the firm has invested around $10 billion in the wider tax and accounting software segment across Europe and North America. Hg will use this experience to support the business, with continued investment in CINC’s go-to-market strategy and further innovation in new product launches, building on the momentum of the AI product launches, TresRE and VendorPay earlier this year.

Tom Kiernan, former CEO and co-founder of ClickPay, one of the industry’s leading payment platforms, will join the board as part of the transaction. This appointment will add Kiernan’s industry knowledge, strong relationships and deep payments expertise to help further strengthen the leadership team and support the business as it continues to rapidly grow.

Farouk Hussein, Partner at Hg, said: “Our extensive work confirms CINC’s product leadership as a system of record in this sector. It has a highly differentiated, purpose-built integrated solution for banking and accounting in a growing segment that is only in the very early innings of software adoption. We look forward to backing Ryan and partnering with the existing shareholders and management team to continue driving the CINC success story.”

Mike Farrell, Managing Director at Spectrum, said:“We’ve had a great partnership with Bill, Ryan and the entire leadership team at CINC. They’ve established CINC’s enviable position in the market, and we are excited to continue to support them, and collaborate with Hg, as the company enters its next phase of growth.”

 

Raymond James is acting as exclusive financial advisor to CINC and Spectrum Equity, and Troutman Pepper and Latham & Watkins LLP are acting as their legal advisors. Harris Williams is serving as exclusive financial advisor to Hg and Kirkland & Ellis LLP is serving as its legal advisor.

The terms of the transaction have not been disclosed.

For further information, please contact:

CINC Systems
Shea Dittrich
shea.dittrich@cincsystems.com

Hg
Tom Eckersley
tom.eckersley@hgcapital.com

About CINC SystemsCINC Systems is one of the largest providers of software in the association management industry and an innovator behind accounting and banking integration. Founded in 2005 by a banker as the industry’s first SaaS offering, CINC systems now employs over 200 people with customers throughout the country. In 2019, Spectrum Equity joined CINC and accelerated the company’s growth. The accelerated growth is due to the continued innovation it provides through CINC, its core software platform, and TresRE, the banking and payments solution that underpins the success of real estate management software providers.

CINC provides accounting and management software to about 35,000 associations around the United States, touching more than 4 million homes. Through CINC, association management companies are better able to serve their boards and homeowners with the technology required in today’s world. CINC offers deep accounting functionality that improves financial reporting performance, property management solutions that keep managers efficient and, in the field, websites and apps that keep homeowners engaged.

About Hg

Hg supports the building of sector-leading enterprises that supply businesses with critical software applications or workflow services, delivering a more automated workplace for their customers.

This industry is characterised by digitization trends that are in early stages of adoption and are set to transform the workplace for professionals over decades to come. Hg’s support combines deep end-market knowledge with world class operational resources, together providing compelling support to entrepreneurial leaders looking to scale their business – businesses that are well invested, enduring and serve their customers well.

With a vast European network and strong presence across North America, Hg’s 400 employees and $65 billion in funds under management support a portfolio of more than 50 businesses, worth over $135 billion aggregate enterprise value, with over 100,000 employees, consistently growing revenues at more than 20% annually. Additional information is available at www.hgcapital.com.

 

 

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Blackstone Real Estate Debt Strategies, Blackstone Real Estate Income Trust, CPP Investments and Rialto Capital Acquire a 20% Equity Stake in a Venture Holding Approximately $17 Billion Commercial Real Estate Loan Portfolio of Former Signature Bank

Blackstone

New York, Miami, Washington and Toronto – Blackstone Real Estate Debt Strategies (“BREDS”), Blackstone Real Estate Income Trust, Inc. (“BREIT”), Canada Pension Plan Investment Board (“CPP Investments”) through its subsidiary CPPIB Credit Investments III Inc., and funds affiliated with Rialto Capital (“Rialto”) today announced that they have entered into a newly formed joint venture with the Federal Deposit Insurance Corporation (“FDIC”) and acquired a 20% equity stake for $1.2 billion in the venture which holds a $16.8 billion senior mortgage loan portfolio retained in receivership following the failure of Signature Bank. The FDIC is maintaining an 80% ownership stake in the venture and provided financing equal to 50% of the venture’s value.

The commercial real estate loan portfolio comprises more than 2,600 first mortgage loans on retail, market rate multifamily and office properties primarily located in the New York metropolitan area. The loans are predominantly performing and encompass a wide range of credit profiles. Approximately 90% of the loans are fixed rate with low in-place coupons and strong in-place debt service coverage.

Jonathan Pollack, Global Head of Blackstone Real Estate Credit, said, “We are excited to invest in this compelling, large-scale opportunity on behalf of our BREDS and BREIT investors. Blackstone’s extraordinary real estate insights and credit expertise positioned us to underwrite approximately $17 billion of senior mortgage loans, allowing us to acquire the entire commercial real estate loan portfolio at an attractive basis. We look forward to working with our borrowers and our partners to maximize the potential of these assets.”

Geoffrey Souter, Managing Director, Head of Real Assets Credit at CPP Investments, said, “The current real estate credit market is a promising source of long-term returns for the CPP Fund and we look forward to exploring further opportunities to invest in this and other capital-constrained sectors. This opportunity builds on our longstanding partnership with Blackstone and is a testament to CPP Investments’ expertise in real estate credit, demonstrating our ability to transact quickly and at scale.”

Jay Mantz, President of Rialto Capital, added, “We are incredibly excited to invest in this historic opportunity with two of the most preeminent global investors, Blackstone and CPP Investments. The Rialto team has managed loans through multiple CRE market cycles, and we look forward to working with our partners to maximize value for all stakeholders.”

Blackstone will be the lead asset manager of the portfolio and Rialto Capital will act as the loan servicer and operating partner. Blackstone is the largest owner of commercial real estate globally and has originated or acquired more than $170 billion of real estate loans and securities since the inception of its real estate credit business. Rialto Capital has oversight of over $100 billion of commercial real estate loans and has experience managing public private partnerships.

CPP Investments invests in both public and private credit and credit-like products globally, leveraging its ability to provide scale, certainty of assets and a long investment horizon. As of September 30, 2023, CPP Investments’ credit portfolio totaled C$75 billion, including investments across corporate, consumer and real assets credit along the rating spectrum.

Advisors
Jones Lang LaSalle served as real estate advisor to Blackstone, CPP Investments and Rialto Capital. Simpson Thacher & Bartlett LLP; Gibson, Dunn & Crutcher LLP; Ropes & Gray LLP; Davis Polk & Wardwell LLP and Bilzin Sumberg Baena Price & Axelrod LLP served as legal advisors.

About Blackstone Real Estate
Blackstone is a global leader in real estate investing. Blackstone’s real estate business was founded in 1991 and has US $332 billion of investor capital under management. Blackstone is the largest owner of commercial real estate globally, owning and operating assets across every major geography and sector, including logistics, residential, office, hospitality and retail. Our opportunistic funds seek to acquire undermanaged, well-located assets across the world. Blackstone’s Core+ business invests in substantially stabilized real estate assets globally, through both institutional strategies and strategies tailored for income-focused individual investors including Blackstone Real Estate Income Trust, Inc. (BREIT), a U.S. non-listed REIT, and Blackstone’s European yield-oriented strategy. Blackstone Real Estate also operates one of the leading global real estate debt businesses, providing comprehensive financing solutions across the capital structure and risk spectrum, including management of Blackstone Mortgage Trust (NYSE: BXMT).

About CPP Investments
Canada Pension Plan Investment Board (CPP Investments™) is a professional investment management organization that manages the Fund in the best interest of the more than 21 million contributors and beneficiaries of the Canada Pension Plan. In order to build diversified portfolios of assets, investments are made around the world in public equities, private equities, real estate, infrastructure and fixed income. Headquartered in Toronto, with offices in Hong Kong, London, Luxembourg, Mumbai, New York City, San Francisco, São Paulo and Sydney, CPP Investments is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. At September 30, 2023, the Fund totalled C$576 billion. For more information, please visit www.cppinvestments.com or follow us on LinkedIn, Instagram or on X @CPPInvestments.

About Rialto Capital
Rialto is a fully integrated real estate investment and asset management platform with a dedicated commercial real estate servicer. With $15.9 billion of assets under management as of September 30, 2023 and oversight of over $100 billion of real estate loans as named special servicer, Rialto invests and manages assets throughout the capital structure in real estate properties, loans, and securities. The company is headquartered in Miami, FL with offices in New York City, Santa Monica, and 9 other locations across the US. For more information, please visit rialtocapital.com.

Cautionary Note Regarding Forward-Looking Statements
This press release includes forward-looking statements within the meaning of the federal securities laws and the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by the use of forward -looking terminology such as “outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “identified,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates”, “confident,” “conviction” or other similar words or the negatives thereof. These may include financial estimates and their underlying assumptions, statements about plans, objectives, intentions, and expectations with respect to positioning, including the impact of macroeconomic trends and market forces, future operations, repurchases, acquisitions, future performance and statements regarding identified but not yet closed acquisitions. Such forward-looking statements are inherently uncertain and there are or may be important factors that could cause actual outcomes or results to differ materially from those indicated in such statements. These factors include but are not limited to those described under the section entitled “Risk Factors” in BREIT’s prospectus and annual report for the most recent fiscal year, and any such updated factors included in BREIT’s periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein (or in BREIT’s public filings). Except as otherwise required by federal securities laws, BREIT undertakes no obligation to publicly update or revise any forward -looking statements, whether as a result of new information, future developments or otherwise.

Contacts

Blackstone
Jillian Kary
212-583-5379
Jillian.Kary@Blackstone.com

CPP Investments
Asher Levine
929-208-7939
alevine@cppib.com

Rialto Capital
Tom Scott
305-485-4196
Tom.scott@rialtocapital.com

Categories: News

Polaris divests NORTH to international insurance group Howden

Polaris

Polaris has entered into an agreement to divest NORTH to global insurance group Howden. NORTH was founded in April 2021 and is today Denmark’s largest independent advisory group within corporate insurance and pensions, financial procurement and mortgage financing.

”NORTH has swiftly become a strong and unique advisory firm based on tireless efforts by everyone within the NORTH organization creating a major breakthrough in the Danish market for specialized financial advisory services. At Polaris, we have contributed by leveraging our industry insight and extensive experience developing partnerships that create new opportunities and value for clients – and we are pleased to have played a part in the establishment of a clear market leader, which now has the perfect conditions for further development with Howden,” says Rune Lillie Gornitzka, partner, Polaris

Please see the following press release:

English

Danish

For more information, please contact:
Rune Lillie Gornitzka, Partner
Phone: +46 24 62 14 64
Mail: rg@polarisequity.dk

Jan Johan Kühl, Managing Partner
Phone: +45 35 26 35 74
Mail: jjk@polarisequity.dk

Categories: News