MERRILL PLACEMENTS PINOUT
Merrill Lynch's private fund placement team is spinning out to launch Mercury Capital Advisors. Michael Ricciardi, Enrique Cuan and Alan Pardee will be Mercury's three managing partners, and are expected to officially launch the firm next month. Merrill's 28-year-old placement division, which Bank of America inherited when the two banks merged in 2008, will be wound down.
KEY MAN ISSUES A RISE AT PAI
Surprise changes at the helm of French GP PAI Partners will trigger a “keyman clause” in the firm's €5.4 billion fifth buyout vehicle, sister website PrivateEquityOnline confirmed. In a move described by one limited partner as an “internal coup”, Lionel Zinsou, a former general partner at private banking group Rothschild & Cie who joined PAI in July 2008, will succeed Dominique Mégret, a 35-year veteran, as chief executive.
AIG GETS OUT OF ALTERNATIVES
American International Group (AIG) is dissolving its private funds holdings, officially ending nearly five decades of investment in the alternative asset class. Bridge Partners, the investment firm of Hong Kong billionaire Richard Li, has agreed to buy the bulk of AIG's private funds unit, including secondaries, co-investment and infrastructure assets, for $500 million.
GPS REAPING PROFITS AT LENOVO
Chinese computer maker Lenovo is proving a profitable investment for TPG, Newbridge Capital and General Atlantic funds. The investors have sold 291.5 million Lenovo shares, raising a total of HK$1.03 billion (€92 million; $133 million). It follows a November 2007 private placement of shares, which raised roughly $374 million – more than the firms' initial $350 million investment made in 2005.
EX 3I P ROHEADS OMERS PUSH
The Ontario Municipal Employees' Retirement System's private equity arm, OMERS Private Equity, has hired former 3i buyout partner Mark Redman to lead its investment activities in Europe. Redman worked for 12 years in 3i's London and Amsterdam offices and helped establish its Benelux team.
CHINESE GPC LOSER TO TARGET
CDH Investments has raised $500 million for the first close of its latest fund, CDH Fund IV, three sources have confirmed. According to the sources, Beijing-based CDH is now targeting commitments of $1.4 billion – a lower target than the firm initially set out with. The sources said the fund initially entered the market looking to raise between $1.5 billion and $2 billion.
ILPA GUIDELINES URGE CARRY DELAY
Limited partners to private equity funds should first be repaid all contributed capital plus a preferred return before general partners begin to receive carried interest, according to a newly unveiled set of terms and conditions best practices from the Institutional Limited Partners Association (ILPA).
BC LOSES CONTROL OF DOMETIC
Dometic, a Swedish manufacturer of refrigeration and recreational equipment, is the latest example of a debt-laden company seeing control shift from its private equity sponsor to its lenders. A source close to the deal has confirmed that BC Partners is no longer a Dometic shareholder, having made a 1x multiple on the deal following a debt-for-equity swap that has left Dometic's 25 lenders in control.
A$400M FIRST CLOSE FOR CHAMP
Australia- and New Zealand-focused buyout firm CHAMP Private Equity has raised A$400 million ($341 million; €238 million) for the first close of CHAMP III Funds, four sources confirmed to sister website PrivateEquityOnline. The firm is targeting commitments of A$1.5 billion for the final close of its fund, which is likely to be held in the first part of 2010, a source said.
HARVARD HIT BY LOSSES
Private equity and real estate were the worst performing asset classes for Harvard Management Company for the fiscal year ended 30 June 2009. All of Harvard's asset classes suffered negative returns during a 12-month interlude that Jane Mendillo, HMC's chief executive, called “the most challenging period in modern times for the financial markets as well as for the Harvard portfolio”.
ADVENT LURES JALAN FROM ICICI
Global mid-market firm Advent International has hired Shweta Jalan as a director for its nascent Indian operations, Advent India PE Advisors. Jalan was formerly a director at ICICI Venture, one of India's largest private equity and real estate firms. At ICICI Venture, she was part of the initial team that built the firm over a ten-year period.
EVCA CRITICISES PLACEMENT BAN
The European Venture Capital Association (EVCA) has written in support of the private placement industry in a letter to the US' Securities and Exchange Commission, which is currently accepting comments on its proposed rule that would see placement agents banned from interacting with public pensions. “Policymakers are unlikely to deter unethical practices by outlawing legitimate market practice,” wrote EVCA secretary general Javier Echarri.
LPS DISCUSS SUN FUND REDUCTION
A group of limited partners in Sun Capital Partners' $6 billion fifth fund is in discussions with the firm to reduce outstanding commitments, according to a source close to the situation. The LPs would like to cut their original commitments because of liquidity issues and asset allocation imbalances, the source said. The talks are ongoing and no decisions have been made. Sun Capital declined to comment.
CHINA LIFE EYES ALTERNATIVES
China Life Insurance, the New York- and Hong Kong-listed insurance and annuity products provider, is to diversify its investments into alternative assets including real estate, private equity and infrastructure. In October, the firm will reveal details on how it will increase its investment activities into these sectors.
ENTERPRISE INVESTORS OPENS CZECH BASE
Warsaw-based Enterprise Investors (EI) has opened an office in Prague, its fourth location in central and eastern Europe, to source new deals and support existing investments. It will be headed by Ivan Jakubek, the EI investment director responsible for the firm's Czech and Slovak business development. He joined EI in 2005 and has seven years of private equity, corporate finance, consulting and restructuring experience, EI said in a statement.
AL ANSARI TAKES REINS AT SHUAA
Sameer Al Ansari has given up his role as chief executive officer of private equity unit Dubai International Capital (DIC) to lead Dubai-based investment bank SHUAA Capital. Al Ansari, who helped establish Dubai Holding in 2004 and later founded DIC, replaces Iyad Duwaji, who resigned as chief executive officer earlier this month to set up his own private equity business. Al Ansari will remain DIC's executive chairman, SHUAA said in a statement.
INVESTORS BUY INTO SKYPE
eBay will sell a 65 percent stake in its Skype internet communications unit to a group of investors led by Silver Lake for $1.9 billion in cash and $125 million in debt. The investor group includes Index Venture, Andreessen Horowitz and the Canadian Pension Plan Investment Board. The deal values the company at $2.75 billion, according to eBay. The deal, which is expected to close in the fourth quarter of 2009, ends eBay's plans to take Skype public, which it slated for 2010.
BLACKSTONE BACKS BUILDING MATERIALS FIRM
Blackstone Group affiliate Blackstone Capital Partners – along with private equity firm Silverhawk Capital Partners and former BHP Billiton chief executive Charles “Chip” Goodyear – will invest up to $780 million in Washington, DC-headquartered building materials firm Summit Materials. A statement from the firms did not provide details as to how much each party has agreed to invest.
GIC SPREADS ITS WINGS
Government of Singapore Investment Corporation (GIC), the sovereign wealth fund, has promoted Lim Chow Kiat as president for Europe and Anthony Lim Weng Kin as president for the Americas. Their aim is to develop contacts with policy makers and leaders in financial, governmental and non-governmental circles.
3I V ENTURE ASSETS ACQUIRED
London-listed 3i has agreed to sell a “significant” portion of its European venture portfolio to Coller Capital and HarbourVest Partners. The secondaries firms will acquire about 36 portfolio investments via Encore I, which will have a maximum size of £170 million ($280 million; €192 million). The Encore fund will be managed by Encore Ventures, a recently established, secondaries-focused affiliate of venture firm DFJ Esprit.