Gryphon Investors acquired Wittichen Supply, Tech makes big showing on inaugural Buyouts 100

Gryphon Investors buys Wittichen Supply and CVC is talks to acquire Glendower Capital.

Happy Monday!

This is Chris, on the Wire this morning for Sarah.

HVAC: Gryphon Investors acquired Wittichen Supply Co, which distributes heating, ventilation, air conditioning and refrigeration equipment and customer service. Charles Herring, who has been with the company for 48 years, will take over as president and continue working with the existing management team.

The investment is Gryphon’s second out of its Heritage Fund. Read it here on PE Hub.

Inaugural: With the help of PEI’s data team, we’ve compiled our inaugural Buyouts 100, the largest 100 North American private equity firms by fundraising over the last five-year period. While the top three perhaps aren’t so surprising, Blackstone, KKR and Carlyle, respectively, Nos. 4, and 5, Thoma Bravo and Vista Equity, represent the evolution of private equity.

One of the big changes in PE over the past five years is the rise of specialization, as evidenced by two tech-focused firms rising to near the top of the fundraising list. As returns have been driven more by operational improvements, and less by financial engineering, firms have increasingly adopted specialization. Read it here on Buyouts.

M&A: The deal environment is unlikely to slow any time soon (perhaps bad news for anyone looking for a breather this month). Lazard CEO Ken Jacobs said M&A is being driven in part by private equity firms, which have raised billions of dollars that have a deadline.

“You also have much more liquidity sources in private equity, so private equity can afford lower returns” due to the increased ability to get deals down, Jacobs said, according to Bloomberg. “It’s easy to exit. There’s less illiquidity in private companies than there’s probably ever been.”

Consolidation: CVC Capital is in late stages of talks to acquire Glendower Capital to expand its capabilities in secondaries — a move we’ve seen made by other big PE shops as secondaries volume appears poised for record levels, writes Secondaries Investor. Jefferies found that estimated secondaries transaction volume reached about $48 billion in the first half, with GP-led deals accounting for about 60 percent of the volume.

Glendower’s management would stay on as part of the deal and the firm would continue to operate under its current brand, Secondaries Investor said. Glendower is targeting $3.5 billion for its Glendower Capital Secondary Opportunities Fund V, and has raised about $2.5 billion so far.

At least five secondaries firms have been acquired so far this year, including Montana Capital Partners, which was acquired by PGIM; and Greenspring Associates, bought by StepStone Group. Read more here.

Drama: Here’s an update of the ongoing saga of Novalpina, a first-time fund manager that raised 1 billion euros in 2017, where the partnership fairly rapidly eroded amid accusations of investment incompetence and differing views of the future structure of the firm.
LPs kicked out the GP in a no-fault divorce in July. The frontrunner to replace the GP is Berkeley Research Group (BRG), which has a unit that focuses on GP replacements and other challenging situations. That unit is led by Finbarr O’Connor and Gavin Farrell.

A vote had not happened as of Friday, sources told Buyouts. Novalpina’s LPs must vote by the end of this week to replace the GP, or the fund will simply move into wind-down mode. LPs prefer to have a new manager take over running the three portfolio companies, which have performed well, rather than just liquidate them in a fire sale, sources said. Read the article here on Buyouts.

That’s it for me! Hit me up with tips n’ gossip, feedback, anonymous information or whatever at cwitkowsky@buyoutsinsider.com or find me on LinkedIn.