| | | | | | | | | | Axios Pro Rata | | By Dan Primack · May 30, 2023 | | Situational awareness: Theranos founder Elizabeth Holmes is scheduled to report to prison today in Bryan, Texas, where she'll begin her 11-year prison sentence for defrauding investors. | | | | | | Top of the Morning |  | | | Illustration: Victoria Ellis/Axios | | | | Private market investors got a pair of wins over the long weekend when President Biden and House Speaker Kevin McCarthy announced their debt ceiling deal: - The very existence of a deal, any deal, which helps walk America back from an economic swan dive.
- The deal details, which do not include cuts to the Inflation Reduction Act's climate initiatives.
What to know: McCarthy and House Republicans began negotiations from a bill they passed late last month, which would have gutted the IRA's low-carbon subsidies on most everything from battery and solar cell manufacturing to commercial and consumer EV purchases. Plus new emissions credits in areas like nuclear energy. - None of that made the final cut, which is a relief to the growing number of private equity and venture capital investors that are disbursing big dollars — and raising dedicated funds — throughout the energy transition stack.
- Particularly those that already have funded projects in the proverbial pipeline.
- Moreover, there are some permitting tweaks on environmental impact assessments that could accelerate approvals.
Caveat: This is still just a tentative agreement, subject to congressional approval. And the House vote scheduled for tomorrow is anything but pro forma. - Also worth noting that the deal is being hailed more by climate investors than by climate activists, who are chafing at the approval of a major gas project in Virginia and West Virginia, plus the aforementioned permitting changes.
One more thing: White House negotiators reportedly sought to include a change to carried interest tax treatment, but it was a nonstarter with McCarthy. The bottom line: Maintaining the status quo lets a lot of private market investors breathe a sigh of relief, and the ensuing certainty could cause others to begin making energy transition bets. |     | | | | | | The BFD |  | | | Illustration: Aïda Amer/Axios | | | | Asda, a British supermarket group, agreed to buy most of convenience retailer EG Group's U.K. and Ireland business for around $2.8 billion. Both Asda and EG Group are backed by TDR Capital and the billionaire Issa brothers. Why it's the BFD: This would create a gas station and convenience store giant, with around £30 billion in annual revenue and nearly 21 million weekly customers. It also would boost Asda's efforts to chase the U.K.'s second-largest grocer, Sainsbury, which Asda was blocked from merging with in 2019. By the numbers: The deal includes around 350 gas stations and 1,000 convenience stores. It will be partially financed via £450 million from Asda shareholders, who also committed to invest another £150 million within three years to fully integrate the businesses. The bottom line: Pay attention to the debt on both sides of this deal. - Asda already had significant leverage based on TDR's 2021 buyout from Walmart (which retained a minority stake), and labor union critics are calling for a Competition and Markets Authority review of the "unsustainable" structure in light of rising interest rates.
- EG Group, meanwhile, would use the merger to delever its own balance sheet; a process it began via its recent $1.5 billion sale-leaseback of some U.S. store properties.
| | | | | | | | Venture Capital Deals | | 🚑 Carmot Therapeutics, a Berkeley, Calif.-based developer of metabolic disease drugs, raised $160m in Series D funding. The Column Group led, and was joined by RA Capital Management and insiders Deep Track Capital, Willett Advisors and Horizons Ventures. https://axios.link/3MC1Ww5 🚑 Carrum Health, an SF-based bundled employer payment platform for specialty health care, raised $45m in Series C funding. OMERS Growth Equity led, and was joined by Revelation Partners and insiders Tiger Global Management, Wildcat Venture Partners, Cross Creek and SpringRock Ventures. https://axios.link/3qkyTW6 • Vectara, a Santa Clara, Calif.-based conversational search startup raised $28.5m in seed funding led by Race Capital. www.vectara.com ⚡ Proxima Fusion, a Munich-based developer of fusion power plants, raised €7m. Plural and UVC Partners co-led, and were joined by HTGF and Wilbe Group. https://axios.link/3qhCV1G • HostGPO, an LA-based group purchasing platform for vacation property hosts, raised $6m. Navitas Capital led, and was joined by Omnia Partners, 75&Sunny, Brian Lee and PAR Capital Ventures. https://axios.link/3ME1KMF 🚑 Wellplaece, an SF-based marketplace for dentistry products, raised $5.5m in pre-seed and seed funding co-led by Eniac Ventures and Bee Partners. www.wellplaece.com 🌎 CUR8, a British carbon removal startup, raised £5.3m in pre-seed funding. GV led, and was joined by CapitalT. https://axios.link/3C03mM3 • Altigreen Propulsion Lab, an Indian maker of electric cargo vehicles, is seeking to raise $85m at a $350m valuation, per Bloomberg. https://axios.link/43v3FtY | | | | | | | | A message from Axios | | AI to power your internal comms | | |  | | | | Generative AI is transforming industries. Axios HQ helps you to harness its power to make your internal comms clearer and more engaging. - The AI-powered features help you plan, compose, and deliver more effective communications in a style that works — Smart Brevity®.
This video explains how it's done. | | | | | | Private Equity Deals | | • Apollo Global Management agreed to buy United Living, a British provider of affordable housing maintenance and construction services, for around £300m from Elysian Capital. https://axios.link/43yprgs • Baring Private Equity Asia EQT plans to buy Credila Financial Services, the educational loan unit of India's Housing Development Finance Corp., for upwards of $1.5b, per the Economic Times. https://axios.link/3ozNInh • Francisco Partners and TPG ended their $5b takeover exploration for SF-based observability software firm New Relic (NYSE: NEWR), after struggling to secure enough debt financing, per Reuters. https://axios.link/43aGt4s • Outdoor Living Supply, a portfolio company of Trilantic North America, acquired Stoneworld, a Mapleton, Utah-based stone and landscape supplies distributor. www.outdoorlivingsupply.net • SilverEdge Government Solutions, a Columbia, Md.-based portfolio company of Godspeed Capital Partners, acquired Gardetto, a Hanover, Md.-based provider of digital design, hardware design and systems engineering solutions. www.silveredge-gs.com • SGT Capital agreed to acquire Elatec, a German provider of secure access management solutions. www.elatec-rfid.com | | | | | | | | SPAC Stuff | | 🚑 ANEW Medical, a developer of neurodegenerative disease treatments, agreed to go public at an implied $94m enterprise value via Redwoods Acquisition Corp. (Nasdaq: RWOD), a SPAC led by Jiande Chen (ex-CEO of IMAX China). https://axios.link/43dt8Z6 | | | | | | | | Liquidity Events | | • Kelso & Co. hired Baird to find a buyer for Augusta Sportswear Brands, a seller of team sports uniforms and apparel that could fetch between $700m and $800m, per Reuters. https://axios.link/45yILMi • Macquarie Group is seeking a buyer for DIG Airgas, a South Korean industrial gas producer that could fetch more than $2b, per Bloomberg. https://axios.link/43bnUNy • Onex Corp. generated around US$355m per a sale of 8.2m shares in Chicago-based insurer Ryan Specialty (NYSE: RYAN). https://axios.link/3MZThVE | | | | | | | | More M&A | | • CMA CGM, owned by the Saade family, agreed to buy the publisher of French newspaper La Tribune. https://axios.link/3oEI3MT • Liberty Mutual Insurance agreed to sell its Latin American unit to Germany's HDI International for around €1.38b. https://axios.link/3MGIC0z • Stratasys (Nasdaq: SSYS), which last week agreed to buy fellow 3D printing firm Desktop Metal (NYSE: DM), rejected a takeover offer from Nano Dimension (Nasdaq: NNDM). https://axios.link/3IIJ25q | | | | | | | | Fundraising | | • Khosla Ventures raised $1b for what it's calling "Excelsior Fund," per an SEC filing. The firm isn't commenting, but this may be a feeder fund for the $3b that Khosla Ventures is currently raising. • Primavera Capital Group, a Chinese private equity firm, raised $4b for its fourth U.S. denominated fund, per Reuters. https://axios.link/43ooebo • Swift Ventures, a firm co-led by TubeMogul vets Brett Wilson and John Hughes, is raising $35m for its second fund, per an SEC filing. | | | | | | | | It's Personnel | | ⚡ Francesco Starace, who recently stepped down as CEO of Italian utility Enel, joined EQT Infrastructure as a partner. https://axios.link/3N0yqBA | | | | | | | | Final Numbers: U.S. IPO filings | Source: Renaissance Capital. Data through 5/30/2023. No major IPOs are scheduled to price on U.S. exchanges this week. But there is a small bit of pickup among IPO filings, which are up over 18% from this same point in 2022. | | | | | | | | A message from Axios | | AI to power your internal comms | | | | | | | | Generative AI is transforming industries. Axios HQ helps you to harness its power to make your internal comms clearer and more engaging. - The AI-powered features help you plan, compose, and deliver more effective communications in a style that works — Smart Brevity®.
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