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The Wire July 21, 2021
Bain's $1.25b deal for Great Hill's B2B healthcare marketplace PartSource, Z Capital makes 2.7x on Premier Thermal, Summer reading with PEI Media Morning, hubsters!
Books: Before we get to today’s news, we’ve got PEI Media’s list of summer reads for you. The list includes just-published options and perennial favorites with a mix of ideas for the beachgoer thinking about their next deal as well as readers looking to dial things back for a bit. Thanks to those who participated! Check it out on PE Hub.
Healthcare meets tech meets supply chain: Bain Capital Private Equity sees a vast opportunity to leverage the continued digitization of healthcare processes, with plans to build upon the success of newly acquired PartSource -- a company that, from a B2B perspective, can be likened to an “Amazon of healthcare”. The transaction, announced Tuesday, assigns Aurora, Ohio-based PartSource a total enterprise value of $1.25 billion, sources familiar with the deal told PE Hub. Great Hill Partners is exiting in the deal, marking the latest in a string of recent scale exits at the nexus of healthcare and tech.
This time around, it was through Bain’s learnings from existing and prior investments in healthcare providers like Aveanna Healthcare, US Renal Care and HCA that it was exposed to the value of a company like PartSource. “Having historically and currently been investors in provider businesses, we see some of the challenges our businesses have,” Bain Managing Director Devin O' Reilly told me. “In this case, that’s managing all the medtech equipment that’s in their facilities.”
Speaking to Bain's conviction in the business, the firm accelerated an anticipated sale process from ever getting underway. “Bain came fast, strong and hard to preempt the process before we fully launched,” Great Hill Managing Partner Mark Taber said. For more on PartSource, check out my full report on PE Hub.
Read the full wire commentary on PE Hub...
That’s it for me! Have a great week ahead, and as always, hit me up with feedback, tips n’ gossip, or whatever at karishma.v@peimedia.com.
Also of note (may require subscriptions)
More space: HSBC is working on a process to move a strip of private equity interests off its balance sheet and into a specially created vehicle that would allow the bank’s private funds team to continue making fund and direct investments, sources told Buyouts. The deal is one of several in the market that allow large organizations to shift private equity into specially created vehicles that provide more space, and fresh capital, to continue building out the strategy. Read it here.
Co-investment expansion: Wall Street Journal writes that California’s second-largest public pension system is weighing a loosening of its rules around co-investing, including tripling the amount it can commit to individual deals, with a goal of increasing the proportion of private-equity commitments made through the lower-cost strategy. Read more on California State Teachers’ Retirement System's plans on WSJ.
ESG: The investment committee of the Teacher Retirement System of Texas is considering adding ESG wording to its investment policy statement. The proposed clause would require the pension’s investment division to “consider ESG factors” relevant to risks and returns. Read it on New Private Markets.
PE Deals
They said it “Anecdotally, [inflation] is coming out much more than it was… even a month or two ago...it’s clearly a risk and clearly on peoples’ radar.” Mark Sorrell, global co-head of M&A at Goldman Sachs, told affiliate publication Buyouts.
Today's letter was prepared by Sarah Pringle Subscribe now to get full, unlimited access to all PE Hub content, including every PE Hub Wire article. FIND OUT MOREPlease visit Buyouts for the latest insight into LP activity and Venture Capital Journal for comprehensive coverage and analysis of what’s happening in VC.
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