PE HUB Wire Highlights, 8.8.19


Photo of Luisa Beltran, PE HUB Senior Editor, courtesy of Buyouts Insider.

Centerbridge walks away from $1.5B GoHealth deal; Ardian eyes North America-based companies with next buyout fund; Francisco sells ClickSoftware to Salesforce for $1.4B

Happy pre-Friday.

A GP of a lower middle market firm told me yesterday that private equity M&A has been down this year. He wondered if the industry is starting to feel the impact of the change in carried interest. In 2017, the Trump administration switched the holding period for capital gains. PE firms now must own a company for three years to get capital gains treatment for carried interest “or you have to pay 37 percent,” the source said.

“I’m wondering if people are holding longer,” the GP said. “M&A is definitely down. Given the market conditions and the fears of a recession, you would think people would be selling anything not nailed to the floor.”

According to PitchBook, the first half of 2019 saw 2,142 deals close totaling $297.1 billion. This was approximately in line with 2018, the data provider said. However, the rest of 2019 would require a “quickened pace” to match 2018’s herculean figure, PitchBook said in its US PE Breakdown.

Hubsters, was M&A down for you this year? If so, why? Email me at lbeltran@buyoutsinsider.com

This deal looks like a huge return for Francisco PartnersSalesforce is buying ClickSoftware for $1.4 billion. Francisco took ClickSoftware private in 2015 in a $438 million deal. See our brief here.

Bayer AG has acquired BlueRock Therapeutics from Versant Ventures for up to $1 billion. BlueRock, a biotech, focuses on stem cell research. See our brief here.

FundsCITIC Capital Partners closed its fourth China buyout fund on its $2.8 billion hard cap.

News from Buyouts/VCJ/Active LPs: What’s going on with the GoHealth auction? According to Sarah Pringle, Centerbridge Partners has walked away from a potential transaction with GoHealth, which helps individuals shop for healthcare insurance, according to people familiar with the matter. Find out why Centerbridge walked here.

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