Side Letter: Vista’s Smith wipes student debt, Morgan Stanley’s Tikehau stake

Remember your college graduation speech? A group of Morehouse College students who graduated on Sunday certainly will after Vista's Robert Smith said he'd wipe their student debts. Here’s today's brief, for our valued subscribers only.

Just happened

Source: World Economic Forum/Jolanda Flubacher

Paying it forward

Vista Equity Partners founder Robert Smith shocked graduating students from Atlanta’s Morehouse College on Sunday when he announced he would pay off their student loans. “On behalf of the eight generations of my family that have been in this country, we’re gonna put a little fuel in your bus,” Smith said. Now there’s a measurable example of the positive social impact PE investing can make.

Morgan a feeling

Morgan Stanley IM has become the latest firm to embrace GP stakes after acquiring a position in the parent company of French private equity manager Tikehau Capital. The banking giant invested alongside Tikehau’s existing owners, who together provided irrevocable commitments of €195 million in equity as part of a €300 million share capital increase.

Morgan Stanley used capital from its North Haven Tactical Value unit which targets long-term private markets investments across various asset classes. It’s understood Tikehau will use the capital and tie-up to push further into the US.

No more Nochus

Secondaries buyers expecting a deluge of giant portfolio sales by Japanese banks on the back of Norinchukin’s $5 billion offering – bagged by Ardian last week – should take a breath. The Basel III capital requirements that caused the sale were already dealt with by the bank’s competitors some time ago, per our colleagues at Secondaries Investor. That doesn’t mean there won’t be any sales; we hear several banks are considering some active management of their alternatives portfolios, which could result in some buying opportunities for secondaries players.


PE in profile. Want to know more about CalPERS’ new head of PE? We’ve got you covered. Greg Ruiz’s GP experience will be key for the pension giant as it seeks to build up its direct investment capabilities, and a source tells us he will “get along well with all kinds”, a valuable attribute in a role that is as much about politics as it is money management.

Minority report. Blackstone’s Strategic Capital Group has made a minority investment in US mid-market tech-focused firm Marlin Equity Partners. Marlin will use the cash injection to expand its global platform and strengthen its alignment with LPs, and will seek to leverage Blackstone’s expertise and resources. Marlin already operates two fund families targeting different ends of the mid-market. The firm joins the likes of PAG, Kohlberg & Co and Leonard Green & Partners in the Blackstone stable.

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

Inside tip

We’re hosting our Operating Partners Forum Europe in London tomorrow and Wednesday with speakers from Carlyle, Apax Partners, Hg and more. We’d love to see you there.

Dig deeper

Cathay commitment. The $204 billion Cathay Life Insurance has approved a $60 million commitment to New Enterprise Associates’ 17th vehicle. The Taiwanese life insurer has made several commitments this year, including to Blackstone’s latest flagship fund and StepStone’s fourth secondary opportunities fund. For more information on Cathay Life Insurance, as well as more than 6,700 other institutions, check out the PEI database.

He said it

“General Atlantic singled out Turkey as a place to not invest. That’s quite ironic. GA came into an angel investment of mine in 2011, and did a 6x in four years, so I thought it was kind of hypocritical of them to single out [Turkey] as a place to not invest.”

EarlyBird principal Cem Sertoglu references GA chief executive William Ford’s comments on Turkey at the IFC/EMPEA Global Private Equity Conference in Washington, DC last week.

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Today’s letter was prepared by Isobel Markham, Adam LeCarmela MendozaAlex Lynn and Preeti Singh.

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