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KKR expands cybersecurity portfolio; Advent closes huge fund; GTCR will grow PathGroup

Advent racks up $25 billion for tenth flagship fund.

Good morning, Hubsters. MK Flynn here with today’s Wire.

Yesterday felt like a slow news day for private equity, but today is hopping!

Growth equity. KKR is expanding its portfolio in cybersecurity. The firm is making a growth equity investment in Semperis, a pioneer in identity-driven cyber resilience for enterprises.

KKR is backing Semperis through its Next Generation Technology Growth Fund II, a fund dedicated to growth equity investment opportunities in technology. KKR’s growth equity strategy invests in companies at an earlier stage in their growth than they would be for private equity but a later growth stage than appropriate for venture investments. With the strategy, KKR backs companies that have proven products and services and are seeking a partner to commercialize and scale.

In this case, KKR is participating in the cybersecurity developer’s Series C, alongside Ten Eleven Ventures, Paladin Capital Group, Atrium Health Strategic Fund, Tech Pioneers Fund, and existing investors including Insight Partners.

“A very dedicated customer base, including a growing number of the largest organizations in the world, trust Semperis to defend their critical identity systems from cyberattacks,” said Ben Pederson, director on KKR’s Tech Growth team, who has joined Semperis’ board of directors. “The vast majority of attacks today are identity-based, targeting credentials to infiltrate businesses. Semperis’ leading identity protection technology and incident response expertise are delivering category-defining innovation, and KKR is proud to back their mission.”

KKR’s other growth investments in cybersecurity include Darktrace, Knowbe4, NetSpi, Reliaquest, and Foregerock.

Megabucks. Advent International has completed fundraising for its flagship fund, Advent International GPE X. The fund reached its hard cap of $25 billion in commitments after less than six months in the market. It’s the second largest PE fund ever raised, behind Blackstone’s $26.2 billion fund raised in 2019.

Together with GPE X’s companion fund, Advent Tech II, Advent has raised over $30 billion in commitments in approximately 12 months from its limited partners and internal capital from Advent.

Following the same strategy as Advent’s prior GPE funds, GPE X will deploy capital across geographies, sectors, deal types and sizes. GPE X will maintain its predecessor funds’ focus on Europe and North America, while also continuing to build Advent’s active local presence in Asia.

GPE X will back companies across five core sectors: business and financial services; healthcare; industrial; retail, consumer and leisure; and technology. Advent will also continue to focus on complex carve-outs from major corporations and public-to-private transactions. Since its inception, Advent has invested more than $15 billion in over 90 corporate carve-outs across 28 countries and has completed more than 25 public-to-private transactions. The fund also has the potential to co-invest with Advent Tech II and Advent’s Latin America-focused fund.

For more, see Private Equity International’s story by Rod James. Rod spoke with Advent’s global co-head of LP services Johanna Barr.

Lab work. GTCR recently made a majority investment in PathGroup Holdings, an independent laboratory that provides anatomic pathology, digital pathology, molecular diagnostic, and clinical testing services to physician groups and hospital systems across the Southeast and Midwest. PE Hub’s Aaron Weitzman spoke to Sean Cunningham, managing director and co-head of healthcare at the firm to learn more.

Add-on acquisitions will figure prominently in PathGroup’s growth strategy.

“In the pathology, molecular and genetic diagnostic space there is so much fragmentation,” Cunningham said. “The clinical space is relatively consolidated with Quest and LabCorp but there are a lot of independent labs doing specialty work, and we think there is a nice opportunity to partner with additional physicians and make a bunch of acquisitions in the independent part of the market.”

For more, read the whole story.

That’s all for now. Chris writes the Wire on Wednesdays, so I’ll see you on Thursday.

Happy dealmaking,

MK