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

• A look at last year’s jump in sponsor-backed bankruptcies

• Plus, Hg hopes to pull in $12 billion for its latest fund

Distress:

Private equity and venture capital-backed companies filed a record 110 bankruptcies in 2024, nearly 16 percent of the total 694 U.S. corporate filings and the highest annual count since S&P began tracking in 2010.

Though last year’s start of rate cuts brought modest relief, there were still 15 percent more portfolio company insolvencies than 2023—itself a challenging year for sponsors relative to historical norms.

Even then, the headline figure might not tell the whole story.

Research from FTI Consulting suggests sponsors are more frequently pursuing out-of-court solutions to avoid formal bankruptcy proceedings. Taken together, portfolio company distress is, by some measures, nearing levels not seen since the financial crisis.

A handful of portfolio companies have even managed to enter "Chapter 22" territory with multiple filings.

Retail chain Joann, acquired by Leonard Green & Partners for $1.6 billion in 2011, has now filed twice in the last twelve months despite 96 percent of stores remaining cash flow positive. The first filing cut the company’s $1 billion debt load in half, but it later returned to court citing vendor issues.

This growth in the number of distressed situations has had a knock-on effect on the prevalence of liability management exercises.

But, while increasingly popular, their efficacy is questionable. A recent AlixPartners survey shows just 3 percent of restructuring professionals think either ‘amend & extends’ or liability management efforts provide permanent solutions (the aforementioned Joann Inc. offering an example of why that’s the prevailing sentiment).

Some attempts have not only failed but also led to litigation. Creditors of Instant Brands, acquired by Cornell Capital for $600 million in 2019, have sued over a $345 million dividend recapitalization they claim left the company insolvent. Cornell Capital called the allegations "baseless attacks," attributing the bankruptcy to "uncontrollable macroeconomic events." The case is set for trial later this year.

• TJC has hired Morgan Stanley to explore exit options, including a sale or IPO, for Silvus Technologies, a wireless communications systems provider that could be valued at up to $5 billion, per Bloomberg.

• Zayo Group, owned by EQT and DigitalBridge, is in talks to acquire Crown Castle (NYSE: CCI)'s fiber business for around $8 billion, following earlier discussions between Crown Castle and TPG.

• PAI Partners entered exclusive talks to acquire a significant stake in Alvest, a French ground support equipment services provider, from Ardian, which will retain a minority position.

• Brightstar Capital Partners acquired WW Williams, a provider of commercial truck parts and aftermarket services, from One Equity Partners.

• Dalfen Industrial and Goldman Sachs Alternatives acquired a multi-city, 2.1 million-square-foot industrial portfolio from Blackstone for $293 million.

• AnaCap acquired a majority stake in Edge Group, an Italian insurance broking platform.

• Welltower (NYSE: WELL) agreed to acquire NorthStar Healthcare Income, a senior housing-focused REIT, for $900 million.

• Nationwide agreed to acquire Allstate's (NYSE: ALL) employer stop loss insurance business for $1.25 billion.

• Bain Capital agreed to acquire Frontline Road Safety, a Denver-based pavement marking services provider, from The Sterling Group.

• Vista Equity Partners acquired RiskExec, a fair lending compliance platform, from Asurity Technologies.

• Carlyle invested in Entertainment 360, a Hollywood talent management and production company.

• TA Associates invested in Brycer, a Warrenville, Illinois-based provider of compliance software for municipal organizations.

• TJC invested $250 million in data center operator DataBank, which completed a concurrent $600 million secondary share offering.

• Brookfield provided $389 million in loans and tax equity financing to clean power developer Encore.

• The U.S. Department of Justice sued to block HPE (NYSE: HPE)'s proposed $14 billion acquisition of Juniper Networks (NYSE: JNPR) on antitrust grounds.

• Sunbelt Modular, a Phoenix-based portfolio company of Littlejohn & Co., acquired BRITCO Structures, a Texas-based manufacturer of commercial modular structures.

• Lead Capital Partners and Petra Capital Partners invested in Lieberman, a Great Neck, New York-based market research and analytics firm focused on healthcare and consumer markets.

• Leste Group agreed to acquire a minority stake in Billor, an Orlando-based freight and fintech platform for truckers.

• Molson Coors (NYSE: TAP) acquired an 8.5 percent stake in Fevertree Drinks (LSE: FEVR) for £71 million and secured exclusive U.S. distribution rights.

• Smiths Group (LSE: SMIN) plans to spin off its baggage-screening and interconnect divisions following activist pressure.

Tech, Vertical SaaS, & Misc. Enterprise

• ElevenLabs, an AI voice synthesis startup, raised $180 million in Series C funding co-led by Andreessen Horowitz and ICONIQ Growth, with participation from NEA, World Innovation Lab, Valor, Endeavor Catalyst Fund, Lunate, Sequoia Capital, Salesforce Ventures, Smash Capital, SV Angel, NFDG, BroadLight Capital, Deutsche Telekom, LG Technology Ventures, HubSpot Ventures, NTT DOCOMO Ventures, and RingCentral Ventures.

• Motif, an architecture design platform, raised $46 million in seed and Series A funding led by CapitalG, with participation from Redpoint Ventures and Baukunst.

• Finout, a cloud cost management platform, raised $40 million in Series C funding led by Insight Partners, with participation from Pitango, Team8, Red Dot Capital, and Maor Investments.

• Seraphic Security, an enterprise browser security provider, raised $29 million in Series A funding led by GreatPoint Ventures, with participation from CrowdStrike Falcon Fund, Planven, Cota Capital, and Storm Ventures.

• D3 Global, a web3 domain infrastructure firm, raised $25 million in Series A funding led by Paradigm, with participation from Coinbase Ventures.

• Irreducible, a zero-knowledge-proof infrastructure startup, raised $24 million in Series A funding co-led by Paradigm and Bain Capital Crypto, with participation from Fenbushi Capital, L2 Iterative Ventures, and Robot Ventures.

• Meteomatics, a Swiss weather intelligence provider offering high-resolution forecasting and autonomous weather drones, raised $22 million in Series C funding led by Armira Growth, with participation from Klima, Alantra Energy Transition Fund, and Fortyone.

• Paxton, an AI-powered legal assistant, raised $22 million in Series A funding led by Unusual Ventures, with participation from Kyber Knight, 25Madison, and Wisconsin Valley Ventures.

• Savant Labs, a no-code analytics automation platform, raised $18.5 million in Series A funding led by Dell Technologies Capital, with participation from Vertex Ventures, Cota Capital, Village Global, Bloomberg Beta, West Wave Capital, and Uncorrelated Ventures.

• Sign, an on-chain token distribution and credential verification infrastructure platform, raised $16 million in Series A funding led by YZi Labs, with participation from Altos Ventures, HackVC, and Amber Ventures.

• Observo AI, an AI-native data pipeline startup, raised $15 million in seed funding co-led by Felicis and Lightspeed Venture Partners.

• Unwrap, an AI-powered customer intelligence platform, raised $12 million in Series A funding led by Scale Venture Partners, with participation from Atlassian Ventures, Cercano, ScOp VC, and AI2 Incubator.

• Oumi, an open-source AI platform for developing and tuning foundation models, raised $10 million in seed funding co-led by Venrock and Obvious Ventures, with participation from Plug & Play and Ascend.

• Tradeverifyd, a Bozeman-based supply chain risk management platform, raised $8 million in Series A funding co-led by Silicon Road VC and Bread & Butter Ventures, with participation from Acronym, Techstars, and a100x.

• Final Round AI, an AI-powered platform helping job seekers navigate interviews, raised $6.88 million in seed funding led by Uncork Capital, with participation from HF0, Linear Capital, Ritual Capital, Mento VC, AltaIR Capital, Alumni Ventures, Goodwater, Hico Ventures, Soma Capital, iSeed Ventures, Level One, and Sky9 Capital.

• Zelt, a London-based HR operations platform, raised $6 million in new funding led by Nauta Capital, with participation from Venrex and Episode 1.

• Output Sports, a Dublin-based sports analytics and athletic wearables startup, raised $4.8 million in pre-Series A funding led by Uni.Fund, with participation from Apex Capital, Dopamine Sports, Elkstone, Atlantic Bridge, and Enterprise Ireland.

Fintech

• Swan, a French embedded banking platform, raised €42 million in Series B extension funding led by Eight Roads Ventures, with participation from Lakestar, Accel, Creandum, Hexa, and Bpifrance.

• Closinglock, a real estate fraud prevention and payments platform, raised $34 million in Series B funding led by Sageview Capital, with participation from Headline and RWT Horizons.

• Formance, an open-source developer of programmable ledger solutions, raised $21 million in Series A funding co-led by PayPal Ventures and Portage Ventures, with participation from Y Combinator, Hoxton Ventures, and Axeleo Capital.

• Anchor, an autonomous billing and collections platform, raised $20 million in Series A funding co-led by Mosaic General Partnership and Zeev Ventures, with participation from Entrée Capital and Tal Ventures.

• OneVest, a wealth management technology platform, raised $20 million in Series B funding led by Salesforce Ventures, with participation from Allianz Life Ventures, TIAA Ventures, OMERS Ventures, Deloitte Ventures, Fin Capital, Luge Capital, and Pivot Investment Partners.

Healthcare

• Rad AI, a developer of generative AI solutions for radiology workflow automation, raised $60 million in Series C funding led by Transformation Capital, with participation from Khosla Ventures, World Innovation Lab, UP2398, Kickstart Fund, OCV Partners, and Cone Health.

• SafelyYou, an AI-powered fall detection solution for senior living facilities, raised $43 million in Series C funding led by Touring Capital, with participation from Foundation Capital, Omega Healthcare Investors, Founders Fund, Cross Creek, Samsung Next, and Qualcomm Ventures.

• KODE Health, a platform connecting healthcare systems with on-demand certified coders, raised $27 million in Series B funding led by Noro-Moseley Partners, with participation from Mercury, FCA Venture Partners, Epsilon Innovation Fund, and 111 West Capital.

• Sound Blade Medical, a developer of handheld ultrasound-guided histotripsy technology, raised $16.5 million in Series A funding co-led by Amzak Health and Lumira Ventures, with participation from Invest Nova Scotia.

• Bicycle Health, a provider of virtual opioid use disorder treatment, raised $16.5 million in new funding led by Questa Capital, with participation from SignalFire, Frist Cressey Ventures, City Light Capital, InterAlpen Partners, Valeo Ventures, Hustle Fund, and JSL Health.

• Nucleus Genomics, a direct-to-consumer genetic testing and analysis platform, raised $14 million in Series A funding led by Seven Seven Six, with participation from Founders Fund, Neo, One Eight Capital, and Giant Step.

Industrials, Greentech, & Other

• Smart Wires, a developer of grid enhancement technology, raised $65 million from BP Energy Partners and Keystone Group.

• Mangrove Lithium, a Vancouver-based developer of electrochemical lithium refining technology, raised $35 million in new funding from Mitsubishi Corporation, Asahi Kasei Corporation, InBC Investment Corp., Orion Industrial Ventures, Export Development Canada, Breakthrough Energy Ventures, BMW i Ventures, and BDC Capital.

• Oxyle, a Swiss startup developing PFAS destruction technology for wastewater treatment, raised $15.7 million in seed funding led by 360 Capital, with participation from Axeleo Capital, Founderful, and SOSV.

• Hg is targeting $12 billion for Saturn IV, its latest flagship fund hoping to acquire between 8 - 10 large-cap software platforms.

• Blackstone raised $8.5 billion for its first private equity fund for individual investors.

• Fortress Investment Group is targeting $1 billion for its second litigation finance fund.

• 8VC is targeting nearly $1 billion for its fifth fund.

• Pantera Capital is targeting $1 billion for its fifth crypto-focused fund.

• TenCap, a new Sydney-based investment firm led by former Tribeca Investment Partners portfolio manager Jun Bei Liu, launched with $940 million in commitments.

• Sverica Capital Management completed a continuation fund for Stream Companies, a provider of automotive dealer marketing software, with backing from RCP Advisors and Churchill Asset Management.

• Blue Sage Capital raised $618 million for its fourth lower middle market fund.

• Cogenuity Partners raised $425 million for its debut lower middle market industrials fund.

• Influence Media Partners, backed by BlackRock, raised $360 million in debt financing backed by music royalties from investors including Nuveen, PPM America, Aflac, Pacific Life, and HPS Investment Partners.

• Curie.Bio raised $340 million for its inaugural biotech seed fund.

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