| | | | | | | | | | Axios Pro Rata | | By Dan Primack ·Jan 31, 2022 | | | | | | Top of the Morning |  | | | Illustration: Shoshana Gordon/Axios | | | | As the financial crisis was unfolding in September 2008, a top buyout executive was nonplussed. He told me that his firm could invest at a discount if stocks went down, and had long enough time horizons that it wouldn't be forced into fire sales of existing portfolio companies. And banks would work to avoid debt defaults. - It was arrogant. It was self-serving. It was largely correct.
Fast forward to 2021: Private equity isn't worrying about stock market losses or the coming Fed rate hikes. All systems are go, and arguably in overdrive. - Again, buying opportunities abound. Just look at today's BFD for Citrix, which is coming at a share price lower than where the software maker was trading for most of the past two years.
- Leveraged loan inflows are on the rise, since such notes come at floating rates. Or, put another way, there are blizzard conditions on dry powder mountain.
- Private equity has raised record amounts of fund capital over the past several years, so it needn't slow down because the "search for yield" will result in LP pullback. For example, Warburg Pincus is raising $16 billion for its latest flagship.
A key difference between September 2008 and January 2022, of course, is that today's macro economy is extremely strong (e.g., GDP, unemployment, etc.). - Sure there are painful pressure points — inflation, hiring troubles, the next variant, possible WWIII with Russia — but few economists would prefer then to now.
The bottom line: Private equity plays a "heads we win, tales we win" game. And that's as true now as it's ever been. |     | | | | | | The BFD |  | | | Illustration: Shoshana Gordon/Axios | | | | Elliott Associates and Vista Equity Partners agreed to buy Citrix Systems (Nasdaq: CTXS), a Fort Lauderdale, Fla.-based provider of workplace virtualization software, for around $16.5 billion (including $3.5 billion of assumed debt). The firms then plan to merge Citrix with existing Vista portfolio company TIBCO Software. Why it's the BFD: This is partially a remote work play, and partially about the buyer believing they can thrive where past management struggled in converting customers from desktop licensees to cloud subscribers. Details: The buyers will pay $104 per share in cash. That's a significant premium to where Citrix shared traded before reports emerged that Elliott (via its Evergreen Coast Capital affiliate) and Vista were circling, but below their levels for most of 2020 and 2021. History: This has been a very long play for Elliott, which first took a Citrix stake in 2015 and held a board seat until 2020. It's a bit reminiscent to what it did with Athenahealth, when activism also led to a buyout. The bottom line: "An agreement with Citrix would cap the biggest-ever month for software deals and follow a rampant year in which private equity firms and strategic buyers chased targets." — Bloomberg | | | | | | | | Venture Capital Deals | | 🐉 FTX, the Bahamas-based crypto giant, raised $400m in Series C funding at a $32b valuation. Backers include Temasek, Paradigm, Ontario Teachers' Pension Plan Board, NEA, IVP, SoftBank, Lightspeed Venture Partners, Steadview Capital, Tiger Global and Insight Partners. Go deeper. • Gupy, a Brazilian recruitment platform, raised $90m. SoftBank and Riverwood co-led, and were joined by Endeavor Catalyst and insiders Oria Capital and MAYA Capital. www.gupy.io 🚑 Gandeeva Therapeutics, a Canadian biotech that leverages cryogenic electron microscopy, raised US$40m in Series A funding. Lux Capital and Leaps by Bayer co-led, and were joined by Obvious Ventures, Amgen Ventures, Amplitude Ventures and Air Street Capital. www.gandeeva.com • Brimore, an Egyptian social commerce startup, raised $25m in Series A funding. IFC and Endure Capital co-led, and were joined by Fawry, Flourish, Endeavor Catalyst Fund, Algebra Ventures, Disruptech and Vision Ventures. http://axios.link/1Hfi 🚑 Ribbon Biolabs, an Austrian synthetic DNA startup, raised €18m in Series A funding. Hadean Partners led, and was joined by Lansdowne Partners, Helicase Venture, IST cube and Tecnet equity. www.ribbonbiolabs.com • Qlub, a European payment solution for restaurant customers, raised $17m in seed funding. Cherry Ventures and Point Nine Capital co-led, and were joined by STV, Raed Ventures, Heartcore, Shorooq Partners and FinTech Collective. http://axios.link/oKPc • Bamboo, a Nigerian investment app, raised $15m in Series A funding. Greycroft and Tiger Global co-led, and were joined by Motley Fool Ventures, Saison Capital, Chrysalis Capital and Michael Seibel. http://axios.link/toOl • Alva Labs, a Stockholm-based recruitment startup, raised $13.1m in Series A funding led by VNV Global. www.alvalabs.io • Operations1, a German provider of adaptive process execution software, raised $12.5m in Series A funding led by OpenOcean. www.operations1.com • Lemonada Media, a podcast network, raised $8m in Series A funding, per The Hollywood Reporter. BDMI led, and was joined by Madison Wells, Greycroft, Spring Point Partners LLC, Intuition Capital, Owl Capital Group and Blue Collective. http://axios.link/re0Q | | | | | | | | A message from Axios | | Last chance: Become an early Axios Pro subscriber | | |  | | | | Subscribe to Axios Pro: All Access before February 1st to receive a free pair of Apple AirPods Pro headphones. Axios Pro delivers exclusive news and analysis from journalists with decades of subject matter expertise. - With All Access, you'll never miss a Pro scoop, newsletter or event.
Start your free trial of Axios Pro: All Access. | | | | | | Private Equity Deals | | • Arcapita agreed to buy Nationwide, a Voorhees, N.J.-based real estate appraisal management company, from Corridor Capital. www.onestopappraisals.com • Brentwood Associates invested in Pacifica Beauty, a Carpinteria, Calif.-based maker of vegan beauty products. www.pacificabeauty.com • Cyara, a Redwood City, Calif.-based provider of automated customer experience assurance solutions, raised more than $350m from K1 Investment Management. www.cyara.com • O2 Investment Partners invested in PR and strategic communications firm BerlinRosen. www.berlinrosen.com | | | | | | | | Public Offerings | | 🚑 Arcellx, a Gaithersburg, Md.-based developer of cancer immunotherapies, set IPO terms to 8.3m shares at $15-$17. It would have a $624m fully diluted value, were it to price in the middle, and plans to list on the Nasdaq (ACLX). The Phase 1 biotech raised $330m from NEA (19.2% pre-IPO stake), SR One (15.1%), Novo Holdings (12.6%), Quan Ventures (8.3%) and Takeda (5.4%). http://axios.link/22Zh • Epta, an Italian maker of commercial refrigerators, is seeking to raise up to €500m at a €1.8b valuation via a Milan IPO, per Bloomberg. http://axios.link/qieb | | | | | | | | SPAC Stuff | | 🚑 Comera Life Sciences, a Woburn, Mass.-based developer of biologic medicines, agreed to go public at an implied $258m valuation via OTR Acquisition Corp. (Nasdaq: OTRA), a SPAC formed by Nicholas Singer's Purchase Capital. http://axios.link/TGCC 🚑 ETAO International, a provider of online and offline health services, agreed to go public at an implied $2.5b valuation via Mountain Crest Acquisition Corp III (Nasdaq: MCAE). http://axios.link/27ot • Kalera, an Orlando, Fla.-based leafy green vertical farming that's traded on the Oslo exchange, agreed to list on the Nasdaq at an implied $375m valuation via Agrico Acquisition Corp. (Nasdaq: RICO), an ag-tech SPAC led by Brent de Jong. http://axios.link/Qsmb • Ace Global Business Acquisition II, a decarbonization SPAC, filed for a $65m IPO. http://axios.link/PFJE | | | | | | | | Liquidity Events | | • AEA Investors hired Barclays to find a buyer for Scan Global Logistics, a Copenhagen-based transport company that could fetch up to €1.5b, per Bloomberg. http://axios.link/SMHa • Pearson (LSE: PSON) agreed to buy the 80% stake it didn't already hold in Credly, a New York-based certification company, per Reuters. The deal assigns a $200m valuation to Credly, which had raised $22m in VC funding from firms like Pearson Ventures, University Ventures, New Markets Venture Partners, Zoma Capital, Lion Brothers Co. and Lumina Impact Ventures. http://axios.link/lqur | | | | | | | | More M&A | | • BlackBerry (TSX: BB) agreed to sell legacy patents to an SPV called Catapult IP for around $600 million. http://axios.link/YKRo • CMA CGM, a French shipper, agreed to buy a 51% stake in French delivery firm Colis Privé from Hopps Group. http://axios.link/GPnH 🚑 ConvaTec Group (LSE: CTEC) agreed to buy Triad Life Sciences, a Memphis-based medical device maker focused on surgical wounds, chronic wounds and burns. The deal is worth up to $450m, including $125m upfront. http://axios.link/C6Vq ⚡ Earthstone Energy (NYSE: ESTE) agreed to buy the assets of Bighorn Permian Resources, located in the Midland Basin, for around $850m in cash and stock. http://axios.link/9Bag 🚑 Illumina (Nasdaq: ILMN) offered several concessions, including price cuts, to secure EU approval for its already completed takeover of cancer detection test maker Grail (Nasdaq: GRAL). http://axios.link/xsmz | | | | | | | | Fundraising | | • Asia Alternatives raised $1.1b for its sixth flagship Asia-Pacific fund-of-funds, plus $900m for related strategies. http://axios.link/4r9j • Freestyle Capital is raising $125m for its sixth flagship fund and $50m for its fourth opportunities fund, per SEC filings. www.freestyle.vc • MaC Venture Capital is raising $200m for its second fund, per an SEC filing. www.macventurecapital.com • Mercer raised $4.8b for its sixth private equity fund-of-funds. www.mercer.com • Nonantum Capital Partners of Boston based $575m for its second fund. www.nonantumcapital.com • OpenView Venture Partners of Boston is raising $800m for its seventh fund, per SEC filings. www.openviewpartners.com • TCV raised $460m for its first-ever fund focused on "expansion-stage" deals. http://axios.link/tVoc • Warburg Pincus is raising $16b for its 14th flagship fund, per an SEC filing. www.warburgpincus.com | | | | | | | | It's Personnel | | • David Schwartz joined Blackstone as a senior managing director focused on tech investments. He previously was with Harvest Partners. www.blackstone.com | | | | | | | | Final Numbers |  Data: Yahoo Finance; Chart: Axios Visuals | | | | | | | | A message from Axios | | Last chance: Become an early Axios Pro subscriber | | | | | | | | Subscribe to Axios Pro: All Access before February 1st to receive a free pair of Apple AirPods Pro headphones. Axios Pro delivers exclusive news and analysis from journalists with decades of subject matter expertise. - With All Access, you'll never miss a Pro scoop, newsletter or event.
Start your free trial of Axios Pro: All Access. | | | | ✅ Thanks for reading Axios Pro Rata! Please ask your friends, colleagues and Bengals fans to sign up. |  | Bring the strength of Smart Brevity® to your team — more effective communications, powered by Axios HQ. | | | | | | Axios thanks our partners for supporting our newsletters. If you're interested in advertising, learn more here.
Sponsorship has no influence on editorial content. Axios, 3100 Clarendon Blvd, Suite 1300, Arlington VA 22201 | | | You received this email because you signed up for newsletters from Axios.
Change your preferences or unsubscribe here. | | | Was this email forwarded to you?
Sign up now to get Axios in your inbox. | | | | Follow Axios on social media:    | | | | | |
