Happy Friday. Here’s what we’ve got today…

• A look at Alacrity’s restructuring agreement

• Plus, Warburg Pincus considers possible $5 billion healthcare exit

A quick trip to zero:

A BlackRock private equity fund has agreed to cede control of insurance claims manager Alacrity Solutions to lenders, wiping out the full $560 million equity investment made through its Long Term Private Capital strategy less than two years ago.

Already in place when BlackRock acquired its stake, Alacrity’s debt burden included a $1 billion unitranche facility plus $500 million in mezzanine debt provided by Goldman Sachs Asset Management.

Under the restructuring, senior lenders, including Antares Capital, Blue Owl Capital, and KKR, will convert roughly half their existing loans to equity. The group will walk away with a 90 percent stake, and GSAM will take remaining 10 percent.

Alacrity’s go-forward capital structure will include a $450 million term loan and $250 million in preferred equity, of which around $175 million will be new capital.

BlackRock purchased its 70 percent majority stake in 2023 at an enterprise value of $765 million, according to data from sell-side advisor Houlihan Lokey (Waller Helms). As part of the deal, prior owner Kohlberg & Co. maintained a significant minority interest.

Alacrity's latest publicly-rated issuance in 2021 was completed at a leverage multiple of 8.1x. At the time, the expectation was that continued growth—then nearly 20 percent year-over-year—would rapidly de-lever the business.

Instead, Alacrity's performance eventually deteriorated as weather-related claims declined and insurance carriers insourced claims management functions. With the business’ concentration in homeowners’ claims, revenue could fluctuate dramatically based on claims volumes from catastrophic events (or a lack thereof).

Alacrity was also left exposed through its dependence on a small handful of insurance carriers—its top three insurers provided more than half of the company's revenue.

BlackRock launched LTPC in 2018 with a thesis around longer-than-normal hold periods for controlling stakes greater than $500 million. Though the firm had originally targeted a $10 billion evergreen structure, it closed a scaled-back $4.3 billion debut fund in 2019.

On paper, the strategy posted strong performance through the first half of 2024, reporting a 33 percent IRR and 2.4x MOIC. Cash distributions, however, have lagged: the fund's DPI was just 0.6x for the same period.

That lack of distributions ultimately killed BlackRock's LTPC plan. Despite securing $300 million in early commitments, the firm has opted to wind down marketing efforts for a planned $5 billion successor fund.

In November, Axios reported on feedback from limited partners telling BlackRock it should "focus on returning money rather than raising money."

Alacrity was the seventh and final LTPC investment. The strategy’s 19-person team is now tasked with winding down the debut fund.

Alacrity has retained Centerview Partners and AlixPartners as restructuring advisors, while BlackRock is working with Evercore. Latham & Watkins and FTI Consulting are advising the lender group. The transaction is expected to close in the first quarter.

• Constellation Energy Corp. (NYSE: CEG) agreed to acquire Calpine, a natural gas and geothermal power producer, for $26.6 billion from Energy Capital Partners, Access Industries, and CPP Investments.

• Ubisoft Entertainment has hired advisers to evaluate options, including a potential sale, amid reports that the founding Guillemot family and shareholder Tencent were considering taking the French video game maker private, per Bloomberg.

• Warburg Pincus is considering a sale of Modernizing Medicine, a Florida-based medical software provider, which could be valued at more than $5 billion, per Reuters.

• Virginia Transformer, a North American power transformer manufacturer, is exploring a sale that could value the company at more than $6 billion, per Bloomberg.

• Court Square Capital Partners and WindRose Health agreed to acquire Soleo Health, a provider of specialty pharmacy and infusion therapy services, from H.I.G. Capital for $1.1 billion, per Axios.

• KKR and PSP Investments agreed to acquire a 19.9 percent stake in American Electric Power's (NYSE: AEP) Ohio, Indiana, and Michigan transmission businesses for $2.8 billion.

• CVC Capital Partners, General Atlantic, HPS Investment Partners, and Leonard Green & Partners are in talks to acquire BlackRock's (NYSE: BLK) equity stake in Authentic Brands Group.

• Odido, the Dutch telecom operator owned by Apax Partners and Warburg Pincus, is preparing for an Amsterdam IPO that could value the company at €7 billion.

• Highlander Health acquired Target RWE, a provider of healthcare real-world evidence solutions, from 22C Capital.

• Cuadrilla Capital acquired Gluware, a network automation software platform.

• Branford Castle Partners acquired DSO Eastern Dental Management from Staple Street Capital.

• GTCR acquired Concord Servicing, a Scottsdale-based provider of software and administration services for specialized loan servicing.

• Ascend Capital Partners acquired Unison Therapy Services, a provider of ABA therapy services, from Ridgemont Equity Partners.

• Battery Ventures acquired a majority stake in Signiant, a provider of secure file transfer software for media and entertainment companies.

• Arcline Investment Management acquired Rotating Machinery Services, a Pennsylvania-based maker of aftermarket parts for turbomachinery infrastructure.

• Howard Energy Partners acquired a 120-mile ethylene pipeline in Markham, Texas from EPIC Midstream Holdings, an Ares Management portfolio company.

• Gladstone Investment Corporation acquired Nielsen-Kellerman, a manufacturer of environmental and sports performance measurement instruments, from Clearview Capital.

• Recognize acquired a majority stake in Sprout, an IT asset disposition provider, from New Capital Partners, which retained a minority stake.

• Lion Equity Partners acquired Global Compression Services, a manufacturer of gas compression equipment.

• Fundamental Advisors acquired HeloAir, a Richmond-based operator of utility and fire suppression helicopters.

• Kian Capital Partners acquired Eden Brothers, an e-commerce retailer of flower seeds and gardening products.

• DBAY Advisors agreed to acquire Alliance Pharma (LSE: APH), a distributor of consumer healthcare brands and prescription medicines, for £349.7 million.

• EQT agreed to acquire Scale Microgrids, a developer and operator of microgrids and distributed energy resources, from Warburg Pincus.

• Transcarent agreed to acquire Accolade (Nasdaq: ACCD), a healthcare navigation platform, for $621 million in cash.

• GSK (LSE: GSK) is in late-stage talks to acquire IDRx, a Massachusetts-based biotech developing therapies for gastrointestinal tumors which could be worth around $1 billion, per Financial Times.

• Falfurrias Management Partners invested in Oddball, a provider of digital services and software development solutions for federal government agencies.

• Palm Beach Capital invested in MBI Cos., an architecture and engineering design firm.

• Vistara Growth invested in Matic Insurance Services, a Columbus-based embedded insurance platform for mortgage servicers.

• Blackstone Tactical Opportunities invested $300 million in DDN, a provider of AI and data intelligence infrastructure solutions at a $5 billion valuation.

• Warburg Pincus invested $300 million in Mashura, a developer of smart cabinet technology and inventory management solutions for veterinary and dental clinics.

• JCPenney and SPARC Group merged in an all-equity transaction to form Catalyst Brands, a combined $9 billion retailer with brands including Aeropostale, Brooks Brothers, and Eddie Bauer, backed by Simon Property Group, Brookfield Corporation, Authentic Brands Group, and Shein.

• Vivo Infusion, a portfolio company of InTandem Capital, acquired Neurology Institute of San Antonio and Vista Infusions, an ambulatory infusion provider.

• Tencarva Machinery, a portfolio company of Bessemer Investors, acquired Detroit Pump & Manufacturing, a Warren, Michigan-based distributor of process pumping and fluid handling equipment.

• Yingling Aviation, a portfolio company of AE Industrial Partners, acquired GETI, a Wichita-based maker of aircraft interiors.

• Bluesight, a portfolio company of Thoma Bravo, acquired Protenus, a healthcare compliance analytics platform.

• Darktrace, backed by Thoma Bravo, agreed to acquire Cado Security, a cloud forensics and automation platform.

• Avel eCare, a portfolio company of Aquiline Capital Partners, acquired Amwell's psychiatric telehealth business.

• Novvia Group, a Kelso portfolio company, agreed to acquire Saxco International, a North American rigid packaging distributor.

• Swoop, backed by New Mountain Capital, acquired MyHealthTeam, an operator of online patient communities.

• Lockmasters, a portfolio company of Dominus Capital, acquired Orchard Lock, a Connecticut-based wholesaler of architectural and commercial door hardware.

• Prada is considering an acquisition of Versace, a luxury fashion brand owned by Capri Holdings (NYSE: CPRI), and has hired Citi to evaluate a potential bid.

• Arm is considering an acquisition Ampere Computing, an Oracle-backed semiconductor designer, per Bloomberg.

• Intercontinental Exchange (NYSE: ICE) acquired American Financial Exchange, an electronic exchange for direct lending and borrowing for U.S. banks, from 7RIDGE.

Tech, Vertical SaaS, & Misc. Enterprise

• OnPay, an Atlanta-based payroll and HR software provider, raised $63m in Series B funding led by Carrick Capital Partners, with participation from AB Private Credit Investors, plus more than $47 million in new debt financing from MC Credit Partners.

• Air, an operations platform for managing digital assets, raised $35 million in Series B funding led by Avenir Growth, with participation from XFund, Good Friends, Tiger Global, Headline Ventures, Lerer Hippeau, WndrCo, Slack Ventures, and Designer Fund.

• PrettyDamnQuick, a checkout and shipping optimization platform for e-commerce, raised $25 million in Series A funding led by PeakSpan Capital, with participation from TLV Partners and Moneta.

• Beams, a UK-based home renovation platform, raised $9 million in Series A funding led by ETF Partners, with participation from Giant Ventures, firstminute capital, and Borusan Ventures.

Fintech

• Parsyl, a supply chain insurance provider, raised $20 million in Series C funding led by The Lightsmith Group, with participation from HSCM Ventures, GLP Capital Partners, Lineage Ventures, and FirstTracks Ventures.

• Anatomy Financial, a developer of financial automation solutions for healthcare practices, raised $19 million in Series A funding led by Canapi Ventures, with participation from Lightspeed Venture Partners.

• Endowus, a Singapore-based digital wealth advisory platform, raised $17.5 million in new funding from Prosus Ventures, UBS, MUFG Innovation Partners, OSK Ventures, and The Wells Investment, bringing its total funding to $110 million.

• SoSoValue, a Singapore-based crypto research platform, raised $15 million in Series A funding co-led by HSG and SmallSpark, with participation from Mirana Ventures and SafePal.

Consumer & Media

• Grand Games, an Istanbul-based mobile gaming studio, raised $30 million in Series A funding led by Balderton Capital, with participation from Bek Ventures and Laton Ventures.

Healthcare

• Verdiva Bio, a developer of oral and injectable GLP-1 and amylin therapies for obesity, raised $411 million in Series A funding co-led by Forbion and General Atlantic, with participation from RA Capital Management, OrbiMed, Logos Capital, Lilly Asia Ventures, and LYFE Capital.

• Innovaccer, a healthcare AI and data platform, raised $275 million in Series F funding from B Capital Group, Banner Health, Danaher Ventures, Generation Investment Management, Kaiser Permanente, and M12.

• Ouro Medicines, a developer of T cell engager therapies for immune-mediated diseases, raised $120 million in Series A funding co-led by TPG Life Sciences Innovations, NEA, and Norwest Venture Partners, with participation from Monograph Capital, GSK, UPMC Enterprises, Boyu/Zoo Capital, and LongRiver Investments.

• Geneoscopy, a developer of RNA-based gastrointestinal diagnostics, raised $105 million in Series C funding led by Bio-Rad Laboratories, with participation from Petrichor, Labcorp, Morningside Ventures, Lightchain Capital, NT Investments, Granger Management, Mercy Health, and Tri Locum Partners.

• Light Horse Therapeutics, a developer of small molecule gene editing therapeutics, raised $62 million in Series A funding led by Versant Ventures, with participation from Mubadala Capital, Bristol-Myers Squibb, Taiho Ventures, and AbbVie.

• Numab Therapeutics, a biotech developing multi-specific antibody immunotherapies, raised $55 million in Series C extension funding co-led by Cormorant Asset Management, Forbion, HBM Healthcare Investment, and Novo Holdings, with participation from BVF Partners, Octagon Capital Advisors, RTW Investments, and BlackRock.

• Coave Therapeutics, a Paris-based genetic medicines developer focused on eye and neurodegenerative diseases, raised €32 million in Series A funding co-led by Novo Holdings and Bpifrance, with participation from Invus, UI Investissement, Seroba Life Sciences, Fund+, Kurma Partners, Omnes Capital, and Turenne Capital.

• Nema Health, a virtual trauma and PTSD care platform, raised $14.5 million in Series A funding co-led by Deerfield Management and CVS Health Ventures, with participation from Optum Ventures, .406 Ventures, and GreyMatter.

• Oxford Cancer Analytics, a developer of blood tests for early cancer detection, raised $11 million in Series A funding co-led by We Venture Capital and Cross-Border Impact Ventures, with participation from Eka Ventures, Civilization Ventures, DigitalDx Ventures, Macmillan Cancer Support, Aurelium Ventures, and OKG Capital.

Industrials, Greentech, & Other

• XOcean, an Irish marine robotics startup, raised €115 million in new funding led by S2G Ventures, with participation from Climate Investment, Morgan Stanley's 1GT fund, and CC Industries.

• Gridware, a power grid monitoring platform, raised $26.4 million in Series A funding led by Sequoia Capital, with participation from Fifty Years, Lowercarbon Capital, True Ventures, and Convective Capital.

• Biosphere, a developer of UV-sterilized bioreactors, raised $8.8 million in seed funding co-led by Lowercarbon Capital and VXI Capital, with participation from Founders Fund, GS Futures, Caffeinated Capital, and B37 Ventures.

• Advanced Ionics, a developer of water-vapor electrolyzer technology for green hydrogen production, raised $6.7 million in new funding from JERA, Lummus Venture Capital, Argosy Foundation, Clean Energy Venture Group, and bp Ventures.

• FTV Capital raised $3.4 billion for its eighth flagship growth equity fund and $651 million for its inaugural Ascend early-stage fund.

• Vistria Group raised $3 billion for its fifth flagship fund.

• Blackstone raised more than $1 billion for its latest retail and HNW infrastructure investment vehicle targeting core and core-plus assets across transportation, digital, energy, and water.

• Vensana Capital raised $425 million for its third medtech venture fund.

• White Summit Capital raised €350 million for its second decarbonization infrastructure fund targeting European energy transition investments.

• Valspring Capital raised $255 million for its debut healthcare-focused fund.

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