Blackstone talks Vivint Smart Home exit; Advent in big take-private deal

Good morning Hubsters, Craig McGlashan here filling in on the Wire.

A quick note to start with. This is the last week we’ll be producing the Wire in 2022 – check the end of today’s edition for more info on the schedule.

In today’s Wire we take a deep dive into Blackstone’s recent exit from a home security provider, we check out Advent International’s take-private of geospatial intelligence firm Maxar Technologies and take some brief looks at deals in sectors as varied as cosmetics, manufacturing and dental education.

Securing the deal. PE Hub’s Obey Martin Manayiti has a fascinating interview with Blackstone’s global head of core private equity Peter Wallace about his firm’s exit in early December from Vivint Smart Home.

Vivint’s clients almost tripled in number during Blackstone’s 10-year hold period.
The New York-based private equity firm sold Vivint to Houston-headquartered NRG Energy for $2.8 billion in an all-cash transaction that represented an implied multiple of a 6.3x run-rate enterprise value to adjusted EBITDA.

Provo, Utah-headquartered Vivint is now one of the top home security providers in the US, according to Blackstone. Wallace told Obey that the company’s advantage lay in its ability to merge siloed services that Vivint’s competitors didn’t have.

“The realization was that this was an opportunity to have a comprehensive suite of services where we could combine security, which was an important part of it, thermostats, cameras, door locks, motion sensors and have all of it working seamlessly together,” said Wallace.

“When we started they had about 600,000 customers and now they have almost 2 million,” he said. “It’s now the second largest security company and the largest smart home provider.”

Even though Wallace refused to comment on the returns, sources told Obey that Vivint was sold at 4x.

Check out Obey’s full interview to read more about Vivint’s history, including why Blackstone held on to the company for a little longer than expected.

If you’d like to read more about private equity investments in security systems, then head over to PE Hub Europe to read about Rockpool Investments’ exit from Fortus Group.

Big deal. Sticking with security but on a geopolitical scale, Advent International has acquired Maxar Technologies, a geospatial intelligence firm, in a $6.4 billion take-private deal. When the transaction closes, Maxar will no longer trade on the New York Stock Exchange and the Toronto Stock Exchange.

According to terms of the deal, Advent will acquire Maxar for $53 per share in cash.

Advent is taking a $3.1 billion stake in Maxar, with British Columbia Investment Management Corporation also making a $1 billion equity contribution.

“We will prioritize Maxar’s commitment as a core provider to the US defense and intelligence communities, and allies, while providing Maxar with the financial and operational support necessary to apply its technology and team members even more fully to the missions and programs of its government and commercial customers,” said David Mussafer, chairman and managing partner of Advent, in a statement.

Cosmetics. TSG Consumer Partners has acquired a majority stake in Denver-based Radiance Holdings, a platform representing a collection of brands in the beauty, wellness, and self-care sectors. No financial terms were disclosed.

As part of the transaction, Radiance Holdings’ management team will continue to lead the company.

Radiance Holdings’ current portfolio is approximately 85 percent franchised and includes the following brands: Sola Salons, a salon studios franchise with approximately 650 locations across the US and Canada as of December 2022; and Woodhouse Spas, a day spa brand in the US with approximately 80 locations across the US as of December 2022.

Manufacturing. Wynnchurch Capital has acquired Houston-based Industrial Service Solutions, a provider of manufacturing services. The sellers were Edgewater Funds and JZ Capital Partners.

“ISS is a leading industrial MRO platform for rotating and process equipment with services that are critical for its customers across a wide variety of industries,” said Greg Gleason, a managing partner at Wynnchurch, in a statement.

Open wide. Avista Capital Partners has acquired Scottsdale, Arizona-based Spear Education, a dental education provider.

“Avista sees Spear as a compelling investment opportunity given its industry leadership, demonstrated growth potential and diversified business model,” said Avista partner Sriram Venkatraman in a statement.

And finally. This is the last week of the year we’ll be producing the Wire, with the final edition on Friday, December 23. The first Wire of 2023 will be on Tuesday, January 3.

But for me, today is the last day of the year as I’m on vacation from tomorrow. I hope you all have a great new year and we’ll speak again in 2023.

Cheers,
Craig