This is Chris, on the Wire this morning for MK.
Final: KKR this week announced a minority investment in its portfolio company Internet Brands by an investor group led by Warburg Pincus, which you can read here on PE Hub.
The minority investment valued Internet Brands at more than $12 billion.
What went unmentioned was the firm also completed a single-asset secondary deal that moved Internet Brands out of an older fund and into a continuation pool for more time and capital to run the business. As with many single-asset secondaries, the Warburg-led minority investment set the valuation for the secondary. KKR also got a fairness opinion as part of the process, a source told me.
Goldman Sachs and Partners Group led the continuation fund portion of the deal, which was advised by Lazard. The secondary fell in the range of $2 billion to $2.5 billion, sources told Buyouts. Read more here.
This deal is interesting for a few reasons, primarily perhaps is that Internet Brands could prove to be one of the largest, if not the largest, GP-led deal of 2022. Bringing large secondaries deals to final close in today’s market has become a challenge because of the price gap between buyers and sellers and the challenge of assembling investor syndicates to take down deals of size.
As one adviser explained it to me, Internet Brands is an example of the type of deal that stands out in the turbulent market. It’s a quality asset, run by a well-known manager, and so is the type of deal that most buyers will jump on – though with hard negotiating around price and terms on the continuation fund.
“The market is willing to do this type of deal; deals of this quality don’t come around a lot,” the adviser said. “The bar has been set so high and they meet the bar.”
Contrast this with a bunch of secondary deals – GP-led and LP portfolio sales – that have hit delays or even been pulled off the market because of pricing or lack of buyer interest.
What kind of things are you seeing out there? Hit me up at email@example.com.
Talent: As many of us are aware, recruiting and retaining talent has been one of the biggest challenges to come out of the pandemic reopening. Workers have had a wealth of options when considering new jobs. That dynamic may be changing as the economy turns, of course.
Private equity has felt the same bite and many invested in companies that focus on recruiting and staff, writes Iris Dorbian on PE Hub today.
A few examples are Littlejohn’s acquisition of Alto Healthcare Staffing and Halifax Group’s investment in Liberty Group, which provides staffing and screening services to the real estate sector. Infinedi Partners in February announced an investment in LaSalle Networks, while HCAP Partners invested in FleetNurse, which provides on-demand healthcare staffing services.
That’s it for me! Have a great rest of your day. Hit me up with tips n’ gossip, feedback, The Drama or whatever at firstname.lastname@example.org or over on LinkedIn.