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

• A look at BlackRock’s deal for HPS and the firm’s integration planning

• Plus, 7-Eleven MBO to include a possible U.S. listing

Making it stick:

On Tuesday, BlackRock announced an agreement to acquire private credit firm HPS Investment Partners for $12 billion in an all-stock deal.

HPS manages around $150 billion and is one of the few private credit managers with enough scale to move the needle for BlackRock. If completed, the deal would grow BlackRock’s alternative assets by more than 25 percent to nearly $600 billion ($220 billion in private credit), placing the firm's alternatives business on level footing with private markets specialists like KKR and Apollo Global Management.

Despite managing $12 trillion in total assets, BlackRock's market capitalization is not much larger than KKR. The firm's conventional public markets business falls short on fee structures and margins—the ‘barbell effect’ bifurcation between low-fee passive strategies and high-fee active alternatives (part of the reasoning behind BlackRock’s push into private capital).

Post-close, BlackRock's next hurdle is integration.

HPS professionals will be moving from a young, entrepreneurial team into the world's largest asset manager.

BlackRock’s primary salve for the transition is its planned retention incentives. According to an investor letter, the firm is offering HPS staffers a combined $675 million in five-year vesting equity grants and continued participation in existing carried interest arrangements. Investment professionals will also maintain more than $1.2 billion of personally committed capital across the firm's strategies.

The approach mirrors BlackRock's $650 million retention pool for Global Infrastructure Partners (GIP), whose acquisition closed in October.

For the acquired firms' senior leadership, both deals also include substantial deferred consideration: around 25 percent of HPS’ $12 billion headline value and 30 percent of GIP's $12.5 billion will be paid in year five, subject to performance benchmarks.

BlackRock will hope these plans deliver a better outcome than past attempts—the 2018 purchase of private credit manager Tennenbaum Capital Partners went about as poorly as it could have.

Out of 35 investment professionals, more than a dozen quickly departed, including four of five senior partners.

BI reported last year that compensation disagreements drove much of the exodus. "BlackRock doesn't pay that well. People knew Tennenbaum was being overpaid relative to BlackRock standards," said one unnamed investor.

The nail in the coffin was a feeling that BlackRock reneged on agreements made with the incoming TCP team.

TCP’s special situations professionals had expected to continue the same strategy post-acquisition, but after arriving at BlackRock, they instead found themselves cut off from pursuing deals in their area of expertise.

Former employees said they believed that BlackRock management had told the head of its existing special situations fund, David Trucano, that it would prevent TCP from encroaching on his business.

"People really felt burned by promises that were not delivered on, and felt they were misled, especially with special situations," one of the former employees told BI, adding that they felt management "told Trucano one thing" and told the TCP team "the exact opposite."

HPS and GIP should, at least, have a bigger voice within the organization. HPS founders Scott Kapnick, Scot French, and Michael Patterson will lead BlackRock's consolidated private credit business and will join the firm's Global Executive Committee. Kapnick will take a board observer role, while GIP CEO Bayo Ogunlesi was granted a full director seat.

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• Novolex, an Apollo portfolio company, is exploring a potential takeover offer for listed packaging business Pactiv Evergreen (Nasdaq: PTVE), currently trading at a market value of around $2.6 billion.

• JC Flowers and Qatar Investment Authority are considering a potential sale of Inigo, a British specialist insurance group, which could fetch up to £2 billion, and have hired Evercore to advise, per Bloomberg.

• TotalEnergies SE agreed to acquire VSB Group, a German renewable energy developer, from Partners Group for €1.57 billion.

• Carlyle, King Street Capital Management, and Davidson Kempner Capital Management are considering reviving the previously shelved sale of Trans Maldivian Airways, an Indian Ocean island-based airline operator.

• TPG is preparing to sell 460-location gym chain Crunch Fitness and has hired Jefferies to lead an early 2025 process that could value the business at more than $1.5 billion.

• ServiceTitan, a cloud-based software platform for trades businesses with $772M in ARR, filed for a Nasdaq IPO with Goldman Sachs and Morgan Stanley as lead underwriters; major backers include ICONIQ (19.4 percent), Bessemer (11.2 percent), and Battery (6.0 percent).

• General Atlantic agreed to acquire Learning Technologies Group (LSE: LTGL), a corporate training provider, for £802.4 million.

• KPS Capital Partners agreed to acquire Crane Company's (NYSE: CR) Engineered Materials business for $227 million.

• FTV Capital invested in Arden Insurance Services, a tech-enabled managing general agent for residential condominium associations.

• Blackstone Tactical Opportunities and Greater Sum Ventures made a preferred equity investment in property management software platform Inhabit, joining existing investors Goldman Sachs, Insight Partners, and PSG.

• AssetMark, a portfolio company of GTCR, acquired Morningstar Wealth's Turnkey Asset Management Platform.

• Relation Insurance Services, backed by Aquiline Capital Partners, acquired San Francisco-based SFBAG Employee Benefit Insurance Services.

• PDI Technologies, backed by Insight Partners, Genstar Capital, and TA Associates, acquired Comdata Merchant Solutions, a provider of point-of-sale hardware and software systems for truck stops, from Corpay (NYSE: CPAY).

• Gersh, backed by Crestview Partners, acquired You First, a Madrid-based sports and entertainment agency.

• Pacific Avenue Capital Partners acquired H.B. Fuller's (NYSE: FUL) flooring adhesives business for $80 million.

• Thoma Bravo acquired a majority stake in USU Product, a provider of IT and service management software.

• SolomonEdwards, a portfolio company of Renovus Capital Partners, acquired tax advisory firm Steele Consulting.

• 4M Building Solutions, backed by O2 Investment Partners, acquired Covenant Building Service, a commercial janitorial services provider.

• Aramco acquired a 10 percent stake in Horse Powertrain, a manufacturer of hybrid and internal combustion powertrains, from Renault Group and Geely at a €7.4 billion valuation.

• Align Capital Partners acquired MKB Co., a manufacturer of erosion control, pollution prevention, and stormwater management products.

• VSE Corporation (Nasdaq: VSEC) acquired Kellstrom Aerospace Group, a distributor and service provider for commercial aerospace engines, from AE Industrial Partners for around $200 million.

• Crescent Energy agreed to acquire Ridgemar Energy's Eagle Ford assets in Texas for $905 million upfront, plus a $170 million earnout.

• OMERS Private Equity agreed to acquire a majority stake in Integris, a New Jersey-based IT cybersecurity consulting firm, from Frontenac.

• Insight Partners acquired a majority stake in Cosmo Tech, a provider of AI simulation and optimization software for enterprise decision-making.

• Summit Partners invested in UHY, a Michigan-based accounting and advisory firm.

• Berkshire Partners invested in RJW Logistics Group, a provider of retail logistics solutions for consumer packaged goods brands with warehouses in Chicago and Dallas, from Mason Wells, which will retain a minority stake.

• Bruin Capital merged European soccer agencies Nomi Sports, Positionumber, and Promoesport into newly-formed platform As1.

• Sunland Asphalt, a portfolio company of Huron Capital, acquired Denver-based Metro Pavers.

Tech, Vertical SaaS, & Misc. Enterprise

• Tenstorrent, an AI chip startup, raised $693 million in Series D funding co-led by Samsung Securities and AFW Partners, with participation from LG Electronics, Hyundai, and Fidelity, among others.

• Veeam Software, a data resilience and security platform, completed a $2 billion secondary sale led by TPG, with participation from Temasek and Neuberger Berman.

• Yurts, an AI integration platform for high-security defense and enterprise environments, raised $40 million in Series B funding led by XYZ Venture Capital, with participation from Glynn Capital, Nava Ventures, Bloomberg Beta, and Mango Capital.

• carbmee, a Berlin-based AI-powered carbon management platform, raised €20 million in Series A funding led by CommerzVentures, with participation from Fly Ventures.

• Vooma, an AI platform for freight brokers and carriers, raised $16.6 million across seed and Series A rounds, with $13 million in Series A funding led by Craft Ventures and $3.6 million in seed funding led by Index Ventures, with participation from Definition Capital, HOF Capital, Soma Capital, and Operator Stack Fund.

• Cake, a managed open-source AI infrastructure platform, raised $13 million in seed funding led by Gradient Ventures, with participation from Primary Venture Partners, Alumni Ventures, Friends & Family Capital, Correlation Ventures, and Firestreak Ventures.

• Pathway, a developer of enterprise AI decision-making systems, raised $10 million in seed funding led by TQ Ventures, with participation from Kadmos, Inovo, Market One Capital, and Id4.

Fintech

• R2, a Latin American embedded lending platform, raised $59 million in combined equity and debt funding, including a $9 million Series A extension co-led by Hi Ventures and Cometa, with participation from Endeavor Catalyst and Gradient Ventures, plus a $50 million debt facility from Community Investment Management.

• Brighty, a Swiss crypto-integrated digital finance platform, raised $10 million in new funding from Futurecraft Ventures.

• HUB2, a Francophone African payments infrastructure provider, raised $8.5 million in Series A funding led by TLcom Capital, with participation from FMO, Enza Capital, BPI France, AXIAN, DCG, and African Fintech Collective.

• MakersHub, an accounts payable automation platform, raised $7 million in seed funding led by QED Investors and TTV Capital, with participation from Dash Fund and TRB Advisors.

Healthcare

• Maze Therapeutics, a developer of genetics-based precision medicines for renal and metabolic diseases, raised $115 million in Series D funding co-led by Frazier Life Sciences and Deep Track Capital, with participation from Janus Henderson, Logos Capital, Third Rock, ARCH Venture Partners, Matrix Capital Management, GV, General Catalyst, Andreessen Horowitz, Foresite Capital, Woodline Partners, Casdin Capital, Piper Heartland Healthcare Capital, and Moore Strategic Ventures.

• Orakl Oncology, a French precision oncology startup designing AI-powered tumor ‘avatars’ for drug development, raised €11 million in seed funding led by Singular, with participation from Bpifrance and Speedinvest.

• Refoxy Pharmaceuticals, a German biotech developing FOXO3 activators for age-related diseases, raised €9.1 million in seed extension funding led by Boehringer Ingelheim Venture Fund, with participation from Apollo Health Ventures, NRW.Venture, and High-Tech Gründerfonds.

Industrials, Greentech, & Other

• Heirloom, a direct air capture startup, raised $150 million in Series B funding co-led by Future Positive and Lowercarbon Capital, with participation from H&M Group, Japan Airlines, Mitsubishi Corporation Americas, Mitsui & Co., MOL Switch, Quantum Innovation Fund, Siemens Financial Services, Ahren Innovation Capital, Breakthrough Energy Ventures, Carbon Direct Capital, and MCJ Collective.

• ConnectDER, a developer of residential meter socket adapters for solar and EV integration, raised $35 million in Series D funding led by Decarbonization Partners, with participation from MassMutual Ventures, Avista Development, Clean Energy Ventures, Energy Innovation Capital, Evergy Ventures, LG Technology Ventures, and Zoma Capital.

• SatVu, a London-based thermal imaging satellite company, raised £10 million in new funding co-led by Adara Ventures Energy Fund and Molten Ventures, with participation from NOA, Lockheed Martin, Seraphim, Ridgeline, and Stellar Ventures.

• Kilter, a Norwegian weeding robotics startup, raised €9 million in Series A funding co-led by Pymwymic and Nufarm, with participation from SBG Invest, Natural Ventures, and ProAgInvest.

• LeapFrog Investments raised $1.02 billion for its fourth fund focused on healthcare and financial services investments in emerging markets.

• Alstin Capital, a Munich-based venture capital firm, raised €175 million for its third fund focused on European B2B software investments.

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