PE HUB Wire Highlights, 10.5.18

The Great B-School Debate: for networking, or for skills?, Martis Capital eyes $450 mln for healthcare fund

Happy Friday!

Apologies for the missing Wire yesterday. As you may have guessed, we had tech issues.

IPO window: This was interesting at our Half Moon Bay conference this week. Michael Rees, head of Dyal Capital Partners, said the shop may look for a public listing faster than origially thought. A public listing is one way firms that buy portfolios of minority stakes in investment firms deliver liquidity to LPs in their funds.

Investors would be able to trade their private stakes for public shares as a way to gain liquidity. While Rees said that investors shouldn’t invest in Dyal because of a potential IPO, that scenario might happen sooner than planned, according to our new LP watchdog Dietrich Knauth writing about Rees’s keynote address at PartnerConnect West in Half Moon Bay earlier this week.

“The likely plan is to put it all together, get the benefit of scale and diversity, and list that,” Rees said. “We certainly are monitoring the attractive valuation that firms are achieving now in the public markets. And so, while I would have said it’s a very long term plan. … The markets are pretty attractive right now, so there’s a good chance that we’ll accelerate that program.”

Read the full story here.

LP activism: Interest groups have hit on a strategy used only scantly in the past to try and effect change in PE-backed companies — put pressure on a firm’s LPs. The big recent example is former employees of Toys ‘R’ Us organizing and speaking at meetings of public pensions that are LPs of KKR and Bain Capital. The campaign seems to have worked as both firms committed to raising $20 million for a severance fund for former employees.

Another firm has been in the crosshairs: Endeavour Capital, based in Oregon, is feeling the heat from activists pushing a national campaign to reform, if not completely end, the commercial bail bond industry. Cash bail unfairly impacts poor communities, who can’t afford to pay it, resulting in longer pretrial jail time.

California recently passed a law to end cash bail, instead putting the responsibility on judges to determine pretrial confinement based on risk assessments of the inmates. New Jersey and Kentucky have similar practices.

ACLU of Oregon, along with other interest groups, spoke at the Oregon Investment Council meeting in September, asking the system not to invest any more money with Endeavour until the firm gets out of the bail bond industry. Endeavour backed one of the largest bail bond companies in the country, Aladdin Bail Bonds, along with an affiliate insurer, Seaview Insurance Co.


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