Good morning, dealmakers. MK Flynn here with the Wire.
In the spirit of Tech Tuesday, Blackstone is buying event management technology provider Cvent from Vista. More below.
We’ve got lots of deal-focused coverage coming from the fallout of Silicon Valley Bank.
We’ll also take a look at Sun Capital’s new platform in its business services portfolio.
And we’re continuing to celebrate Women’s History Month.
In a sign that the events industry is back, Blackstone is buying Cvent from Vista Equity Partners for $4.6 billion in a take-private deal.
“The continued events and travel recovery is one of Blackstone’s highest-conviction investment themes,” said David Schwartz, a senior managing director at Blackstone. “Given our extensive experience in the hospitality, events and real estate sectors, we believe Blackstone is well positioned as a growth partner for this exceptional business.”
Vista acquired Cvent in 2016 for $1.65 billion. Since then, Cvent has more than tripled its annual revenues, according to the company.
Vista’s been active on the dealmaking front. Earlier this year, Vista agreed to acquire Duck Creek Technologies for $2.6 billion and closed its previously announced $4.2 billion deal to acquire KnowBe4.
Recent Vista exits include Datto, Ping Identity, SecureLink and a partial exit from Zapproved.
Venture capital firms, including General Catalyst, Andreessen Horowitz and Khosla Ventures, are still trying “to preserve parts of Silicon Valley Bank so it can keep serving clients in the technology sector, according to people briefed on the effort,” reports the Financial Times.
One proposal reportedly being discussed is forming a consortium with Apollo that could bid for portions of SVB.
The firms declined to comment to the FT.
I sent email to the PR folks at Apollo earlier this morning but haven’t heard anything back yet. I’ll keep you posted if there’s any news.
SVB Financial Group, the holding company of Silicon Valley Bank, is exploring strategic options for its various business lines, including a sale of its $9.5 billion funds-of-funds business that includes limited partner positions in funds, reports Buyouts’ Chris Witkowsky.
Yesterday, SVB Financial announced it formed a restructuring committee on options for its business lines, including SVB Capital and SVB Securities and other investments – none of which are part of Silicon Valley Bank.
The company is working with Centerview Partners, Sullivan & Cromwell and Alvarez & Marsal on the process.
“In addition to exploring potential transactions for the SVB Capital and SVB Securities businesses, the committee will explore all alternatives for addressing the approximately $3 billion of funded debt held by the holding company, which is recourse only to SVB Financial Group and is not guaranteed by the subsidiaries,” the company said.
Private equity pros are already facing a challenging dealmaking environment, what with rising interest rates and gaps in the expectations of buyers and sellers. Now the demise of Silicon Valley Bank is revealing another area of vulnerability.
“Regional banks play a role in a significant number of middle-market private equity transactions, and the collapse of SVB has exposed a systemic risk in the regional bank infrastructure,” Bryan Henderson, co-head of the private equity group at Houston-based law firm Baker Botts, told me.
In the wake of the SVB collapse, Henderson expects that private equity sponsors and their portfolio companies will begin reevaluating their relationships with regional banks.
Henderson doesn’t expect panic to ensue. The reevaluation process is likely to be done “in an orderly fashion, in light of the federal government’s action to backstop deposits for a year.”
Nevertheless, the reevaluation process “could result in a pause, or slowdown, in PE deals,” Henderson said.
And mid-market PE deals may become more expensive. “The cost of capital from these banks will go up when sponsors are borrowing in connection with leveraged deals.”
If you have any thoughts to share on how the SVB fallout is affecting PE-backed deals and portfolio companies, please send them my way at email@example.com.
Earlier this morning, Sun Capital announced a majority investment in Anderson Business Advisors, adding another platform investment to the Boca Raton PE firm’s growing business services portfolio.
Founded in 1999, Anderson is a Las Vegas-based provider of corporate services, including entity formation and incorporation, registered agent, and tax and bookkeeping services, primarily serving real estate investors.
“The corporate services sector is highly fragmented, creating strong potential for Anderson to grow through strategic acquisitions that will increase market share and diversify its customers,” said Alexander Wyndham, principal at Sun European Partners, who sourced the deal.
Demand for corporate services to real estate investors is expected to grow more than six percent annually, driven by several key tailwinds, including macroeconomic conditions, an increase in outsourcing, a tighter regulatory environment and strong pricing power, according to the PE firm.
The deal follows Sun’s acquisition in February of K3 Capital Group and also of Fletchers Solicitors in 2021. Fletchers has “seen strong growth under Sun’s ownership, both through strategic add-ons and organic growth initiatives,” according to the PE firm.
Throughout the month of March, we’re highlighting women dealmakers.
Today, we’re featuring Jaroslava Korpanec, partner and head of Central and Eastern Europe, energy infrastructure, at Actis Partners, which is headquartered in London.
Korpanec was born in the Czech Republic in the mid-70s when the country, then part of Czechoslovakia, was behind the Iron Curtain. After the Berlin Wall fell, she took the chance to study abroad, where her school achievements won her a spot studying law at the University of Cambridge.
“I joined Simpson Thacher & Bartlett and took the New York Bar to qualify as a lawyer in the US. This was driven by the fact that ultimately, I wanted to get into investing and help build and manage real businesses,” she told PE Hub Europe’s Irien Joseph.
Fast-forward a few years and Korpanec, along with two other founding partners, started Allianz Capital Partners, the first infrastructure investment group of Allianz.
Today, Korpanec sees enormous opportunity for investments in Central and Eastern European markets.
“These markets are rapidly converging with other European markets in terms of regulatory frameworks as well as macroeconomic policies, making it a stable and attractive environment for foreign investors,” she said.
Women of influence
Nominations have opened up for PEI Group’s third annual Women of Influence in Private Markets list, which recognizes trailblazing women in alternative assets.
The deadline for nominations is Wednesday, March 22.
The list – which will include women from private equity, infrastructure, private debt, real estate and venture capital – will be published in July by Private Equity International, Private Debt Investor, Infrastructure Investor, Venture Capital Journal and PERE.
That’s it for today. Chris will write Wednesday’s Wire, and I’ll be back with more on Thursday.
Happy dealmaking until then,