How’s your week going? How are things turning out as we move into the last few months of the year?
Recruiting: Orangewood Partners made a strategic investment in Barrington James, a recruitment business serving the pharma, biotech and medical device sectors, writes Aaron Weitzman on PE Hub today.
Orangewood’s investment is Barrington James’ first institutional capital. The company’s leadership rolled over a significant portion of its interest into the deal.
Positions in the life sciences industry “require significant industry knowledge and an understanding of the needs of these very specialized and technical businesses,” Neil Goldfarb, managing partner of Orangewood, told Aaron. “Naturally, the pandemic put a large spotlight on the life sciences and biopharma sectors, which we think are going to continue to attract interest and investment over the long term.”
Companies that seek to address staffing shortages in the healthcare industry have been attracting private equity investors lately. For example, One Equity Partners announced last week that the New York firm had acquired Prime Time Healthcare, a healthcare staffing services provider that specializes in nurses and other practitioners.
Staffing is a “long-term pain point for companies,” Goldfarb said. “The labor force continues to become more transient and, with work-from-home here to stay, we believe these trends will only accelerate in the future.”
Tech: SFW Capital Partners sold Greenshades Software to an investor group led by Waypoint Capital and Gearbox Capital. As part of the deal, SFW Capital retained a minority stake in Greenshades. Read more here on PE Hub.
Distributions: By all accounts, distribution activity is slowing, which makes sense in an environment where overall M&A activity has dropped off a cliff. GPs are having to plan for longer holds of companies they may have wanted to sell this year, which means less money flowing back to LPs, which in turn means LPs won’t have as much capital to invest back into GPs’ new funds.
It’s a highly interconnected machine and when it works, it hums along at a smooth and easy pace. But when one part of the machine gums up, the whole system is at risk of breaking down.
That’s what we’re seeing now, as the machine slowly grinds down. GPs now are doing all they can to distribute capital back to LPs, sources have told me. It’s all about finding paths to liquidity.