The Alternative Investor | November

Combining firepower

Another tie-up between sovereign wealth funds and private capital is in the co-investment space. An old hand at this is once again Mubadala, which took a minority stake in Silver Lake back in 2020. This gives Silver Lake added firepower and Mubadala access to all important proprietary deal flow, which so far has included the likes of Waymo and Jio Platform. Their latest potential joint investment is a takeover of Endeavor Group. And while there are no figures yet given for this transaction, this promises to be a sizeable deal, with the talent agency’s market cap standing at around $11 billion.

Glasses half empty...

At the Future Investment Initiative in Riyadh, there was a general air of pessimism from leading figures in our space.

JPMorgan’s Jamie Dimon talked about his concerns on the size of the US fiscal deficit and risks of an expanding war. Bridgewater founder Ray Dalio discussed the widening social divisions between the rich and poor. While Carlyle CEO Harvey Schwartz said that he sees more “headwinds” than “tailwinds” as we adapt to the new rate environment, but then went on to add that these markets are likely to offer

“incredible alpha opportunities”. The Future Investment Initiative is an event to watch and has grown in prominence, attracting many of the biggest names in financial services.

There was further pessimism, this time from Citadel’s Ken Griffin, who was speaking at the Bloomberg New Economy Forum, saying that higher baseline inflation is here for “decades,” with further interest rate rises to come, to keep the house in order having “[spent] on the government level like a drunken sailor.”

Pulling the IPO rug

The past few weeks must have been tense at CVC Capital Partner's Luxembourg headquarters as they decided on their potential Amsterdam listing. If this had happened, it would have been a massive shot in the arm for the globally depressed IPO market. There were plenty of rumours that this was set for mid-November; then came the news that it was on hold, with the possibility of revisiting next year. The market was hardly surprised, with IPO volumes depressed and of the handful of big-banner IPOs this year, there have been few successes, with most trading below initial offering prices. The IPO window now looks to be closed for the rest of the year. Unfortunately for CVC, while the internal stars had looked very much aligned, with the PE giant on a roll and good stories to tell, having just closed the largest-ever private equity fund at €26 billion, the external reality was just too risky.