Global disruption and inflation playbooks; plus, Vestar bets on virtual care

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The Wire

Mar. 7, 2022

Global disruption and inflation playbooks; plus, Vestar bets on virtual care

Good morning, dealmakers. MK Flynn here, with today’s Wire on a sober Monday morning.

Uncertain times. After a record-breaking year for private equity, the ground has shifted, writes Hugh MacArthur, partner, Bain & Co., in the firm’s 2022 Global Private Equity Report, which was published earlier this morning.

“While we believe the outlook remains strong in 2022, several important factors will weigh on investors’ minds as they think about doing deals,” MacArthur says. “Covid-19–related issues have increased inflation to levels not seen in the US and other markets in 40 years. Russia’s invasion of Ukraine has dialed up global disruption, causing uncertainty around supply chains, energy prices, and other economic factors, as well as untold human suffering, fear, and panic. There’s no way to know how these global disruptions will play out, but the reaction from the Federal Reserve and other central bankers will shape current and future dealmaking. One thing is for certain: There are now inflation playbooks developing across the GP and LP landscape, as investors race to protect margins and future returns.”

I’d love to hear how you’re handling these increasingly uncertain times. Email your thoughts to me at [email protected]

Spotlight on healthcare. And now for a look at healthcare with the latest installment of PE Hub’s ongoing series.

“Virtual care has shown enormous promise and has become more widely accepted,” Mike Vaupen, managing director and co-head of healthcare of Vestar Capital Partners, told Aaron.

For more, read the full story.

Lighter side. Buyouts’ Off-duty column provides a snapshot of top investors, including a few details about what they do in life when not chasing deals. The latest edition, written by Kirk, spotlights Holden Spaht, managing partner, Thoma Bravo. Spaht has been the point person on many of the firm’s top software deals, including mortgage finance tech company Ellie Mae, the 2020 sale of which realized a 217 percent gross IRR, earning it Buyouts’ Deal of the Year.

Check out the full story.

Some good news. New York City’s covid cases are decreasing while vaccination rates are increasing, prompting Mayor Eric Adams to remove restrictions. For example, masks are now optional in K-12 schools. For us at PE Hub and Buyouts, that means more face-to-face time with colleagues and sources. This afternoon, I’m looking forward to seeing co-workers in our New York office!

Until tomorrow,

MK

Read the full wire commentary on PE Hub ...

Also of note (may require subscriptions)

Amundi Asset Management, Europe’s largest asset manager, wants to become the next institutional investor with an in-house secondaries team, Secondaries Investor has learned. The Paris firm is targeting €1 billion of secondaries capital under management by 2025.

I’m a non-US GP – will the SEC’s proposals affect me? The degree to which non-US sponsors would be impacted by the changes depends on whether they are registered with the SEC. (Private Equity International)

Alumni Ventures and its chief executive Michael Collins misled fund investors by charging 10 years’ worth of management fees up front, an unusual practice that was not spelled out in the funds’ marketing materials, according to a Securities and Exchange Commission claim against the firm. (Buyouts)