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‘Genuine optimism’ after a difficult dealmaking cycle, says Dechert; HighPost Capital joins Charlesbank in Front Row Group

Good morning dealmakers, it’s Obey Martin Manayiti with the US edition of the Wire from the New York newsroom on this deal-heavy Tuesday.

E-commerce is front and center of consumer behavior these days, and PE firms are investing in the sector actively. We are opening the newsletter today with the news that HighPost Capital made a significant minority investment in Front Row Group. PE Hub was the first to report the deal. Stay tuned for HighPost chairman and CEO’s take on the deal, below.

Next, private equity firms are increasingly investing in a modernization drive by the Department of Defense. Today we are turning to OceanSound Partners’ recent investment in a provider of integrated radio frequency and advanced communications products. I interviewed Joe Benavides, a managing partner at OceanSound, about the deal.

And we have a couple of deal announcements. First, Branford Castle Partners has acquired a Wixom, a manufacturer of aviation component testing equipment. We have details about the seller below.

And then Percheron Capital has launched a residential roofing repair and replacement services platform.

Finally, I will close with a look at a new report from Dechert Global Private Equity that offers reasons to be optimistic about dealmaking in 2025.

Emerging brands

PE Hub was the first to report that HighPost Capital has made a significant minority investment in Front Row Group, an e-commerce and digital marketing agency. My colleague Rafael Canton spoke to David Moross, HighPost chairman and CEO, about the deal and how the emerging manager is investing its first fund, which closed in 2022.

Premium subscribers to the Wire have access to more on this deal.

Integrated radio frequency

OceanSound Partners recently acquired Antenna Research Associates (ARA), a Laurel, Maryland-based provider of integrated radio frequency and advanced communications products to the aerospace and defense end-markets.

Sign up for the premium version of the Wire to learn more about what Joe Benavides, a managing partner at OceanSound, told me.

Aviation equipment testing

Branford Castle Partners has acquired Testek Solutions, a Wixom, Michigan-based manufacturer of aviation component testing equipment from Odyssey Investment Partners.

Premium subscribers to the Wire have more on this deal.

Residential roofing repairs

Percheron Capital has launched Alloy Roofing, a San Francisco-based residential roofing repair and replacement services platform. Alloy is launching through an initial partnership with Amstill Roofing, a Houston-based residential roofing and repair services.

Upgrade to the premium version of the Wire to get more.

Smoother road ahead

After a slow start to the year, the global PE market has proved resilient in 2024, and there is increasing optimism that 2025 has the potential to be even stronger, Dechert’s 2025 Global Private Equity Outlook Report noted.

Premium subscribers to the Wire have more on this report.

That’s it for me today. As always, I’d love to hear from you at obey.m@pei.group.

Craig McGlashan will bring you tomorrow’s Europe Wire, while Rafael Canton will bring you the US edition.

Cheers,

Obey

Read the full Wire commentary on PE Hub ...

Also of note (may require subscriptions)

EQT wants to use M&A to expand OEM International’s product verticals and geographic footprint in a fragmented industrial components distribution segment, Simon Tillmo, director, told PE Hub.

Apax Partners has decided not to go forward with plans to form a continuation fund for some of its portfolio companies, Secondaries Investor has learned. The continuation fund could have been between $2 billion and $3 billion in size with discussions around three companies, Secondaries Investor had been told.

Global consumer giant L Catterton will look to expand its RMB fund platform after raising the first two vehicles in the series, Private Equity International understands.

Lexington Partners, the third-biggest secondaries firm according to the SI 50, wants to raise as much as $1.5 billion for its dedicated fund focusing on concentrated GP-led deals after having launched its strategy prior to the summer. (Secondaries Investor)

Canada's Alberta government has appointed an interim CEO of the Alberta Investment Management Corp after the legislature dismissed several of the system’s board members last week. (Buyouts)

The rise of stranded asset risk: As climate change starts to bite and ESG rules tighten in many markets, investors face a substantial risk that their physical assets may get left behind. (Infrastructure Investor)

Given the growing number of climate funds that are now on the market, it may be hard to believe that any corner of the market could yet remain unserved by GPs. Nevertheless, Mark Berryman, managing director of impact investing at Caprock, has identified such an area. (New Private Markets)

Institutional exposure to real estate expected to drop in 2025: Half of institutional investors are under-allocated to real estate amid stronger performance in public equities, finds Hodes Weill and Cornell University’s latest Allocations Monitor. (Private Equity Real Estate)

They said it

“There is a sense of genuine optimism for the next 12 months with a more settled political picture, at least in developed markets, and a brighter economic climate providing respite from a difficult dealmaking cycle.”

— Dechert’s 2025 Global Private Equity Outlook Report