Aterian expands metal finishing platform, Secondaries hits record levels, Thoma Bravo-backed Imprivata buys GroundControl

Aterian expands a platform company with an add-on and secondaries skyrocket to record levels.

Morning Hubsters!

Aterian Investment Partners, the firm launched by executives from Sun Capital and Insight Partners, expanded its platform company Pioneer Metal Finishing with its add-on of Pilkington, a metal finishing business. Read our news brief here.

The Pilkington acquisition provides Aterian’s Pioneer platform with further exposure in the aerospace & defense and medical end-markets, the firm said.

Aterian closed its third fund in 2018 on over $350 million. The firm is led by Michael Fieldstone, a former principal with Sun Capital, ex-Sun Capital Principal Christopher Thomas and ex-Insight Partners Brandon Bethea.

Growing: We’ve got some secondaries numbers rolling in this morning. Overall deal volume was estimated around $80 billion, according to Evercore. Setter Capital, meanwhile, estimated total deal volume around $85 billion.

While estimated total deal volume hit a record high, it also didn’t reach into the $90 billion-level, which some professionals had been predicting. This was because the pace of deal activity slowed in the second half last year.

“My sense is buyers are increasingly leery about a possible downturn. As a result, they pulled back a bit in the year’s final months,” said Peter McGrath, founder of Setter Capital. Read more here.

Several secondaries professionals told me last year that buyers spent their allocations for the year in the early months of 2019. So by the second half, many buyers were waiting for 2020 to resume their buying sprees.

Single-assets: One point of interest involves single asset deals, in which a GP will move one asset out of an older fund and into a newly created special purpose vehicle. LPs in the older fund have the option to cash out of the single asset, or roll their interest into the SPV. Such deals give GPs more time to manage the asset, while delivering liquidity to LPs.

Single-asset deal volume doubled between 2018 and 2019, accounting for 20 percent of total GP-led deal volume last year, according to fresh research from Evercore. That’s up from 9 percent of GP-led deal volume in 2018.

One of the big single-asset processes we covered last year was Revelstoke Capital Partners moving Upstream Rehabilitation out of the firm’s debut fund and into a continuation vehicle. The deal was led by Coller Capital.

Such deals involve the risk for the buyers, who are putting big capital into one company. That type of concentration risk is not something secondary buyers historically have taken, but larger funds give them more flexibility to chase larger deals. Also, such deals usually involve syndicating total investments out to co-investors.

It’s unclear if single-asset deals will continue to grow as a part of the overall secondary market. While GPs like having a secondaries option for an asset they want to hang on to, buyers say they are cautious around such deals.

Awards: Get your Deal of the Year Awards nominations in by Feb. 10, 2020. Go here for the rules and to read about past winners. Send submissions directly to me at

Top Scoops
Los Angeles City Employees’ Retirement System’s private equity allocation inched upwards in fiscal 2019, writes Justin Mitchell on Buyouts. Read it here.

Imprivata, backed by Thoma Bravo, acquired GroundControl Solutions, which provides cloud-based automation software for provisioning shared mobile devices. Read the news brief here.

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