KKR Targets Healthcare Analytics Giant Cotiviti at $11B Valuation, Buyout Firms Circle Macy's, Bain's 18x Return on Wind Turbines

KKR Targets Healthcare Analytics Giant Cotiviti at $11B Valuation, Buyout Firms Circle Macy's, Bain's 18x Return on Wind Turbines

Private equity news the week of December 11th, 2023.


Chart of the Week: The industry that has seen the greatest increase in private equity sponsorship over the past five years has been software — although nearly all of that activity has occurred since 2021, when valuations declined and VC funding began to dry up. As a result, software companies have become much more appealing to traditional buyout firms. (Read More)

  • Private Equity Firms Are Increasing Exposure to These Industries (Read More)
  • AI in Private Equity Report (Read More)
  • The Profile of a Private Equity-backed CEO (Read More)
  • Meet KKR’s Portfolio Operations Group (Read More)
  • Healthcare Private Equity Buyouts Remain Strong Amid Pan-European Consolidation (Read More)

Deal News

KKR is in talks to acquire a 50% stake in healthcare technology company Cotiviti from Veritas Capital at a valuation near $11 billion. Cotiviti produces data analytics software that helps healthcare providers manage costs and compliance. Veritas acquired Cotiviti for $4.1 billion in 2018. (Source)

Macy’s is weighing a $5.8 billion buyout offer from Arkhouse Management and Brigade Capital Management. The investors think Macy’s needs to be a private company if it has any chance of pulling-off a successful turnaround. The company has been subject to criticism from multiple activist investors over the years. Macy’s CEO Jeff Gennette is set to retire next year and will hand over the reigns to former Bloomingdale’s CEO Tony Spring. (Source)

Bain Capital is selling Japanese energy company Japan Wind Development (JWD) for $1.4 billion. The company operates 293 wind turbines and other renewable energy assets. Bain acquired JWD in 2015 for about $80 million, making the sale a 17.5x exit for the buyout firm. (Nikkei)

EQT has agreed to acquire industrial waste management company Heritage Environmental Services (HES). Financial terms were not disclosed, but for context, HES is the third-largest provider of industrial waste management services in the US. EQT Partner Juan Diego Vargas says digital transformation will be a key piece of the firm’s value creation plan for HES. (Source)

Permira has agreed to acquire European insurance brokerage GGW Group. Blackstone’s private credit group is providing a $1 billion loan package for Permira to finance the deal. GGW Group specializes in providing insurance coverage for small and medium-sized business in Europe. Permira’s Head of DACH Florian Kreuzer says insurance is becoming one of the firm’s buyout focuses in Europe. (Source)

TPG’s impact investing fund is in talks to acquire UK education company Outcomes First Group at a $1 billion valuation. The company operates several education brands, including Acorn Education, which provide schools and learning services for children with special needs. (Source)

Hildred Capital Management has agreed to acquire bankrupt baby brand Hello Bello for $65 million. The company was founded by actors Kristen Bell and Dax Shepard in 2019. Hello Bello started as a sustainable diaper brand that sold exclusively to Walmart, but today its products are also sold online and through other retailers. (Source)

LA-based private equity firm Regent LP is in talks to acquire Cheddar News from Altice USA. Cheddar is a millennial-focused financial news streaming service that was founded by former Buzzfeed executive Jon Steinberg. It was a digital media darling during the rise of video streaming services. Altice acquired the company for $200 million in 2019. (Source)

Industry News

Investment banker Ken Moelis says there’s a “huge backlog” of M&A deals. He doesn’t think the Federal Reserve necessarily needs to cut rates to unlock more deal activity, just “stabilize.” (Bloomberg)

Citigroup’s Global Head of Asset Management Anthony Diamandakis says dealmaking is poised to have a big year in 2024 (Bloomberg)

German football clubs have voted to approve private equity investment in the league. Several buyout firms have been trying to invest in the media rights for the league. (Financial Times)

26North, the new private equity firm founded by Josh Harris, is raising $4 billion for its first buyout fund. The firm’s dealmakers are targeting buyouts in industrial, financial services, technology, media, and telecom. (Bloomberg)

Shannon Crespin has joined One Rock Capital Partners as an operating partner. She’ll be focused on working with the firms portfolio companies on supply chain operations. Previously, Crespin was chief operations officer of Tonal, a fitness equipment company. (One Rock Capital)

David Rubenstein wants to be the new owner of the Baltimore Orioles. (CNN)

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