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The Wire Sept. 8, 2021
TransUnion explores sale of TransUnion Healthcare, Advent unloads Distribution International in $1bn deal, Thoma backs Intel 471
Morning, hubsters!
Another scale carve-out process is underway, with credit reporting agency TransUnion evaluating a sale of its healthcare revenue cycle management subsidiary, TransUnion Healthcare, PE Hub has learned. While the company began fielding first-round bids just over a week ago, with at least one partying bidding at $1.6 billion and others lower, I’m told -- it appears to be another case in which valuation complexity is at play.
Approximately $100 million of EBITDA was marketed for TransUnion Healthcare, with initial valuation guidance for the business in the $1.9 billion to $2.2 billion range, sources said. Valuation guidance has since dropped to around $1.6 billion to $1.9 billion, some of the sources said. They attributed this in part to a lower EBITDA figure that potential buyers are using to bid – which for some is closer to... Check out my full report on PE Hub.
An observation: Many non-healthcare companies have acquired their way into healthcare and healthcare IT, acknowledging how much opportunity there is to be had. But in the last 20 years or so, many of those endeavors have ended with exits or attempts to exit in disappointment (Consider IMB Watson Health, for example). “When you think about what big hospitals and healthcare systems need today -- for those that do nothing [in] healthcare -- it gets harder,” as one PE source put it.
That’s it! Have a great week ahead, and as always, write to me at [email protected] with any tips, comments or just to say hello!
Read the full wire commentary on PE Hub...
Also of note (may require subscriptions) Huge: Clearlake Capital‘s seventh fund, which hit the market this summer, is expected to raise more than its $10 billion target, a person with knowledge of the firm told Buyouts. Fund VII does not yet have a cap, the person said. It’s not clear how much the pool has raised so far. It could go above the target by anywhere between $2 billion to $3 billon, as it is already oversubscribed. Read it here.
North of the border: Fulcrum Capital Partners held an initial close for a sixth lower-mid-market buyout fund targeted to bring in more than C$300 million ($240 million), Buyouts has learned. Fulcrum Capital Partners VI, which has a hard-cap of C$400 million, earlier this year secured “roughly half of the target,” partner Paul Eldridge said. Read it on Buyouts.
Boosting it: Abu Dhabi Investment Authority has increased its appetite for private equity after its busiest year in the asset class to date, writes Private Equity International. The sovereign wealth fund – which manages an estimated $649 billion, according to the Sovereign Wealth Fund Institute – raised its allocation band for private equity from 2 to 8 percent in 2019 to 5 to 10 percent last year, according to its latest annual report, published Wednesday. Read it on PEI.
PE Deals
They said it “You will see fewer consortium deals, but you will see more co-underwriters partner with GPs to fill that capital structure need that used to be filled by other PE firms.” A managing director at a global asset manager that runs a co-investment program told Private Equity International that co-investments will continue to grow as GPs still prefer to partner with LPs over being a member of a consortium deal.
Today's letter was prepared by Sarah Pringle Subscribe now to get full, unlimited access to all PE Hub content, including every PE Hub Wire article. FIND OUT MOREPlease visit Buyouts for the latest insight into LP activity and Venture Capital Journal for comprehensive coverage and analysis of what’s happening in VC.
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