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Russian sanctions felt by private equity portfolio companies; bankruptcies fall in 2021


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

Private equity and venture capital investments in Russia are feeling the impact of restrictions imposed on the country’s banking system after its military invasion of Ukraine from February 24.

New York-based global venture capital firm Starta Ventures has offices in Berlin and Moscow and has completed 17 deals in Russia since 2018, according to data from S&P Global Market Intelligence. He works with founders of tech companies in Ukraine and Russia who incorporated their businesses in the United States, but many still have development teams in their home markets that may be cut off from cross-border payments, said Renat Khairullin, head of program at Starta. .

“They have to pay [development teams]they have to transfer that money, and the banking system in Russia is currently under sanctions,” Khairullin said.

In addition, the sponsors announce their intention to dispose of Russian participations. Virginia, Georgia, Rhode Island and Colorado are among the states whose investment entities are considering or withdrawing from Russian investments.

CHART OF THE WEEK: Private equity portfolio company bankruptcies fall in 2021

⮞ In 2021, there were 46 holding company filings, representing 3.78% of total Chapter 7 Bankruptcy”}” data-sheets-userformat=”{“2″:513,”3”:{“1″:0},”12″:0}”>Chapter 7 Bankruptcy filings, according to data from S&P Global Market Intelligence.

⮞ The previous year, during the COVID-19 lockdown period, 134 holding companies filed, the highest number in the previous four years, accounting for 4.6% of total bankruptcies, the data showed.

⮞ In the past 14 months, 48 ​​North America-based private equity holding companies have filed for bankruptcy, and 13 of them, or about 27% of the total, are in liquidation, according to data from Market intelligence. Fifteen companies out of the total are being reorganized, and the other 20 are operational or have operational subsidiaries.

FUNDRAISING AND OFFERS

* Apollo Global Management Inc. has completed its acquisition of the wealth distribution business of Griffin Capital Co. LLC, which now joins Apollo Global Wealth. The private equity firm will also acquire Griffin’s retail-focused products and associated asset management team in a final closing expected to take place in the second quarter.

* EQT AB (publ) is raising €5 billion for its new EQT Active Core Infrastructure fund, which will target core infrastructure companies primarily in Europe and North America.

* A joint venture comprising global infrastructure funds managed by KKR & Co. Inc. and Pembina Pipeline Corp. agreed to purchase a 51% interest in Energy Transfer Canada ULC from Energy Transfer LP for a valuation of $1.3 billion, including debt and preferred stock. The deal is expected to be finalized by the third quarter.

* Thoma Bravo LP will invest in UserZoom in a deal that values ​​the customer experience software business at $800 million.

ELSEWHERE IN THE INDUSTRY

* Morgan Stanley Capital Partners has raised $2 billion for North Haven Capital Partners VII LP and its associated funds.

* Cornell Capital LLC secured $1.7 billion for the Cornell Capital Partners II LP fund, exceeding its original target of $1.5 billion.

* Accel-KKR LLC has raised $1.35 billion for the Accel-KKR Growth Capital Partners IV LP fund, surpassing its original target of $850 million, Dow Jones Newswires reported.

* Middle-market private equity firms Sheridan Capital Partners and Morgan Stanley Private Equity have completed their majority recapitalization of SpendMend LLC. Sheridan will remain a minority shareholder in the healthcare cost cycle platform.

FOCUS ON: APPLICATION SOFTWARE

* OpenGate Capital LLC has rolled out new funding in loyalty and customer retention services company Social Annex Inc., doing business as Annex Cloud.

* Summa Equity AB acquired Belgian trading and compliance information platform Intix through Summa Equity Fund III.

* Audax Private Equity has sold Mobileum Inc. to a subsidiary of HIG Technology Partners of HIG Capital LLC. Audax retained a minority stake in the telecom analytics solutions provider.

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