Side Letter: SEC’s global reach; Bain & Co takeaways; Inflexion’s Ukraine support

Fallout from the SEC's bid to overhaul private funds could reach further than some might realise. Plus: Highlights from Bain & Co's latest private equity report and Pantheon has collared a secondaries veteran. Here's today's brief, for our valued subscribers only.

Just happened

US and them
It’s been nearly a month since the US Securities and Exchange Commission proposed sweeping rules for private funds and what is clear from the GPs and LPs that Side Letter has reached out to so far is that many are still processing exactly what the changes would mean for them. One area where some appear hazy is whether, and to what extent, non-US sponsors will be impacted by the proposals.

That’s a question Private Equity International sought to answer this morning, with the aid of several private equity legal eagles. The full article is worth a read for any GP headquartered outside the US, and the bottom line is this: any sponsor with a touchpoint to the US, such as those managing US LP capital or with a US-based office, will be impacted; the extent to which is dependent on whether or not they are registered with US.

Why it matters: some of the most significant of the SEC’s ‘potentially earth shattering‘ proposals apply to all GPs, registered or not, including the ban on preferential treatment and certain fees and expenses to a private fund or its portfolio companies. Our take: GPs that so far haven’t paid much heed to what’s going on in the US should start thinking about what the changes, if adopted in the current form, would mean for them, and prepare accordingly.

Black swans on the horizon?
Private equity’s upwards trajectory last year could be impacted by inflation, rising interest rates and what could be a protracted war in Ukraine, Brenda Rainey, executive vice-president of Bain & Company’s global PE practice, tells PEI. Rainey spoke to us on the back of the consultant’s latest global PE report, details of which you can find here. Below are a few key takeaways:

  • Private capital fundraising hit $1.2 trillion last year, a 14 percent increase from the 2020 total and a new record
  • Buyout deal value reached $1.1 trillion, roughly double 2020’s $577 billion
  • The asset class notched up $957 billion of exits globally, also doubling the prior year’s total
  • Dry powder across buyouts, venture, growth, distressed, secondaries and infrastructure reached $3.4 trillion
  • Public-to-private deals accounted for $469 billion of deal value globally, with North America and Asia-Pacific particularly busy

Essentials

Inflexion’s Ukraine donation
London-based Inflexion Private Equity has become the latest sponsor to help support the ongoing crisis in Ukraine. The firm’s charitable arm, the Inflexion Foundation, has pledged to donate £500,000 ($658,205; €607,431) to the Disasters Emergency Committee Ukraine Appeal, through the British Red Cross, per a statement. Inflexion’s staff have also launched their own fundraising appeal. Industry body Invest Europe last week said it would donate €100,000 to support the work of the International Committee of the Red Cross in Ukraine and urged its 610 members to follow suit. More about how the crisis is impacting PE participants and their portfolios here.

Pantheon Collers secondaries vet
Pantheon has hired a global head of secondaries, nearly one year after the departure of its London-based secondaries co-head. Amyn Hassanally will join in the autumn after a 16-year spell at Coller Capital, where he was most recently a partner and global co-head of investment execution, according to a statement. He will lead a team of 22 professionals, including seven partners, and report to global private equity head Jeff Miller.

In April, our colleagues at Secondaries Investor revealed that Pantheon’s co-head of secondaries Matt Jones was to join TPG, leaving New York-based co-head Rudy Scarpa at the helm. According to a spokesperson, Hassanally’s role will be to provide strategic oversight of the PE secondaries business, with Scarpa continuing to lead the deal teams and help with fundraising.

Pantheon is in market with its seventh secondaries programme, targeting $2 billion, according to PEI data. In October, it closed its first fund dedicated to GP-led secondaries deals on $624 million.

Sommer time for Tikehau
Tikehau Capital has appointed former Silverfleet partner Ricardo Sommer to lead its German PE business, according to a Monday statement. Sommer spent three years at Silverfleet and helped establish the firm’s lower mid-market investment activities in Western Europe, with a focus on DACH markets. Operating from Tikehau’s Frankfurt office, which launched last year, Sommer will focus on growth equity, energy transition and decarbonisation opportunities.

Dig deeper

LP meetings. It’s Monday, so here are some LP meetings to watch out for this week.

8 March

9 March

10 March

11 March


Today’s letter was prepared by Alex Lynn with Rod James and Carmela Mendoza