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

• A look at Blackstone and Carlyle’s life sciences strategies

• Plus, Amundi considers an offer for Allianz Global Investors

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Drug money:

Some firms are pushing deeper into life sciences and drug development investments, betting on strategies that mitigate some of the typical risks associated with biotech.

Blackstone Life Sciences’ (BXLS) latest $1.6 billion Yield fund is putting cash to work through a hybrid model focused on post-approval, commercial-stage products with structured credit investments and royalty monetization.

BXLS’ flagship fund provides more traditional equity-based financing but invests only in products (vs. companies) and targets late-stage opportunities they feel have already been de-risked. The firm estimates that 85 percent of its Phase III investments have been approved, compared to an industry average of 51 percent for the same time period.

Carlyle is similarly building on its 2020 acquisition of Abingworth, a life sciences specialist whose prior investments include 73 IPOs and home runs like Galapagos and Alnylam Pharmaceuticals.

Last week, the firm launched its latest $1.5 billion dedicated clinical trials fund that will finance up to eight late-stage trials.

Like recent deals with Gilead and Teva, the investments will be structured as partnerships with the pharma sponsor. Abingworth will provide up-front development funding in exchange for milestone payments and royalty rights on the back end.

Both Blackstone and Carlyle have carved out something of a middle ground between higher-risk venture and traditional late-stage private equity.

They're also operating across the full opportunity set. In Blackstone's case, the firm has actively pursued more bespoke arrangements for mature commercial-stage pharma. Take their deal with Alnylam Pharmaceuticals: Blackstone Life Sciences partnered with the firm’s credit platform to provide a $2 billion financing that included $1 billion for royalty monetization, up to $750 million in senior secured debt, and $150 million for specific R&D programs.

In many ways, such strategies can be more predictable than other asset classes. Rather than rely on traditional exit avenues, cash is returned through royalties, milestone payments, and structured payouts tied to commercial success.

Commercial adoption of a new therapeutic is always a risk, but other parts of the equation can be relatively high-visibility. The probability of approval across a portfolio, more grounded market sizing, and greater competitive transparency (sales data on approved drugs and the status of development-stage assets) all mean that much less is left to chance than one might assume for ‘risky’ biotech investments.

Another part of the draw is the market gap. Over the past decade, demand for R&D capital has increased 2.5 times against supply growth of only 1.5 times, according to Evaluate Pharma.

That’s especially true for Phase III development, which accounts for half of the $170 billion annual funding gap. As buyout and credit become more crowded, pharma and biotech financing might prove an attractive option.

• Covalis Capital submitted a £5 billion takeover bid for UK utility Thames Water.

• Walmart (NYSE: WMT) acquired smart TV manufacturer Vizio for $2.3 billion.

• Amundi (PARIS: AMUN) is considering an offer for Allianz Global Investors, Allianz SE’s asset management arm.

• Mubadala Capital agreed to acquire a 42 percent stake in Silver Rock Financial, a Los Angeles credit platform managing $10 billion, from Michael Milken's family office.

• A group including Starwood Capital Group, Sixth Street, SSW Partners, Warburg Pincus, and Qatar Investment Authority offered to acquire the remaining 60 percent stake it doesn’t already own in ESR Group, an Asia-focused real estate manager, at a $7.1 billion valuation.

• EQT has hired Financial Technology Partners to lead a sale process for payments-services provider Banking Circle, which could fetch up to $4 billion, per Bloomberg.

• Duke Street acquired and combined ostomy care product manufacturers ForLife Group (carved out from Nordic Capital portfolio company GHD GesundHeits) and Trio Healthcare.

• Altus Capital Partners acquired Air Innovations, a manufacturer of environmental control units.

• Vector Capital Management agreed to acquire Bigtincan Holdings (ASX: BTH), a provider of sales enablement software and AI solutions, for A$183 million in cash.

• EQT agreed to acquire battery storage provider Ju:niz Energy as the first deal in its new energy transition strategy.

• COH Sports, led by Resilience Capital Partners co-founder Stephen Rosen and Guardant Health chairman Helmy Eltoukhy, agreed to acquire second-tier soccer club Sheffield United from United World Group and Prince Abdullah bin Abdul Aziz Al Saud.

• Aya Healthcare agreed to acquire Cross Country Healthcare (Nasdaq: CCRN), a healthcare staffing provider, for $615 million in cash.

• RWE launched a sale process to exit its 25.1 percent stake in German grid operator Amprion, which could be worth around €2 billion, per Bloomberg.

• Conagra Brands (NYSE: CAG) is exploring the sale of its Chef Boyardee canned pasta brand, which could be valued at more than $500 million, and has hired Centerview Partners to gauge market interest, per Reuters.

• PSG invested in Element451, a provider of AI-powered CRM and student engagement software for higher education.

• Kudu Investment Management acquired a minority stake in RiverNorth Capital Management, a Florida-based investment manager with $5.2 billion in assets.

• Neoen agreed to sell its Victorian renewable energy portfolio to HMC Capital as part of antitrust requirements for its €6.1 billion sale to Brookfield.

• IRIS Software, backed by Leonard Green & Partners and Hg, agreed to acquire Dext, a bookkeeping automation platform, for around £525m from Hg.

• LeaseCrunch, backed by Aquiline Capital Partners, merged with Finagraph, a provider of financial data collection software for CPAs.

• AirX Climate Solutions, a portfolio company of Gryphon Investors, acquired Powrmatic USA, a Maryland-based manufacturer of commercial and industrial HVAC systems, from Stamm International Corp.

Tech, Vertical SaaS, & Misc. Enterprise

• Tuskira, an AI-powered enterprise threat defense platform, raised $28.5 million in new funding co-led by Intel Capital and SYN Ventures, with participation from Sorenson Capital, Rain Capital, and Wipro Ventures.

• Enterpret, a customer feedback intelligence platform, raised $20.8 million in Series A funding led by Canaan Partners, with participation from Kleiner Perkins, Peak XV Partners, Wing Ventures, and Recall Capital.

• BRM, a vendor management and procurement platform, raised $15 million in Series A funding led by Caffeinated Capital.

• Spexi, a Vancouver-based drone imagery network developer, raised $11.5 million in Series A funding led by Blockchange Ventures.

• Ethyca, a data privacy engineering startup, raised $10 million in new funding led by Aspenwood Ventures and AVP.

• Nectir, an AI learning assistant, raised $6.3 million in seed funding led by Long Journey Ventures, with participation from Entrada Ventures, Precursor Ventures, and Behind Genius Ventures.

Fintech

• DPL Financial Partners, an annuities platform for financial advisors, raised $23 million in Series C funding led by Eos Ventures, with participation from TIAA Ventures.

• CAT Labs, a developer of digital asset recovery tools, raised $5.4 million in seed funding led by M13, with participation from Castle Island Ventures, CMT Digital, and Hash3.

Consumer & Media

• Planet A Foods, a German developer of cocoa-free chocolate alternatives, raised $30 million in Series B funding co-led by Burda Principal Investments and Zintinus, with participation from AgriFoodTech Venture Alliance, Bayern Kapital, Cherry Ventures, Omnes Capital, Tengelmann Ventures, and World Fund.

Healthcare

• Cleerly, an AI-powered cardiovascular imaging startup, raised $106 million in Series C extension funding led by Insight Partners, with participation from Battery Ventures.

• Sollis Health, a concierge medicine provider, raised $33 million in Series B funding led by Foresite Capital, with participation from Torch Capital, Montage Ventures, Friedom Partners, Read Capital, and One Eight Capital.

• Amae Health, a provider of in-person mental healthcare, raised $15 million in Series A funding led by Quiet Capital, with participation from Healthier Capital, Baszucki Group, Bling Capital, 8VC, Virtue, and Able Partners.

Industrials, Greentech, & Other

• AMP Robotics, a developer of AI-powered waste sorting robotics systems, raised $91 million in Series D funding led by Congruent Ventures, with participation from Blue Earth Capital, California State Teachers Retirement System, Liberty Mutual Investments, Wellington Management, Range Ventures, Sequoia Capital, Tao Capital Partners, and XN.

• FibreCoat, a German materials startup developing fibers for radiation shielding, raised €20 million in Series B funding co-led by NewSpace Capital and Goose Capital, with participation from Nova Saint-Gobain, 212 NexT, Otto Krahn New Business, Convergent Ventures, and TiE.

• Realta Fusion, a Madison-based developer of magnetic mirror fusion technology, raised $12 million in seed funding led by Khosla Ventures.

• Advent International has begun preliminary meetings with limited partners for a new flagship fund, which is expected to be a similar size to its previous $25 billion vehicle, per Bloomberg.

• Temasek Holdings launched a wholly-owned private credit platform with an initial S$10 billion ($7.5 billion) portfolio of direct investments and credit funds, to be managed by a 15-person team led by Nicolas Debetencourt across New York, London, and Singapore.

• Sixth Street Partners is targeting at least $4 billion for its sixth opportunities fund, which will focus on credit and equity investments across biotech, energy, and sports.

• H.I.G. Bayside Capital, the special situations credit affiliate of H.I.G. Capital, raised $1 billion for its seventh European middle market special situations fund.

• Valeas Capital Partners, founded by former Hellman & Friedman executives, raised $600 million for its debut lower middle market fund.

• Atlas Venture raised $450 million for its fourteenth biotech fund focused on seed and Series A investments.

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