Ares backs BlueCove; Thoma Bravo closes Coupa deal; plus Black History Month interviews

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Ares backs BlueCove; Thoma Bravo closes Coupa deal; plus Black History Month interviews

Good morning, Hubsters. MK Flynn here with today’s Wire.

There’s a lot of private equity deal news this morning.

Ares is betting on tech-driven fixed income asset management, as it takes a stake in BlueCove.

Thoma Bravo has closed its $8 billion acquisition of Coupa.

And we’ve got a final interview in our Black History Month series.

Let’s get to it!

Going mainstream. Ares Management Corp. announced this morning that it is acquiring a minority equity stake in BlueCove. The deal includes an option for Ares to acquire control of the business over a multi-year term.

Based in London, BlueCove specializes in “scientific” fixed income asset management.

“BlueCove immediately stood out as an ideal partner in this sector, given its specialized team across investment, research, and engineering capabilities and institutional infrastructure,” Boris Okuliar, partner and co-head of liquid credit at Ares.

Taking private. Thoma Bravo continues its prolific dealmaking streak, closing the $8 billion deal for Coupa Software, a pioneer in the Business Spend Management category. The deal, which includes a significant minority investment from the Abu Dhabi Investment Authority, was announced in December.

"Coupa created the Business Spend Management category and is well-positioned to capitalize on this large and expanding global market," said Holden Spaht, a managing partner at Thoma Bravo. "Our partnership with Coupa will leverage Thoma Bravo's deep software expertise to help accelerate growth, drive continued investment in product innovation, and better serve the company's world-class customer community.”

I interviewed Spaht for PE Hub’s Outlook 2023 series back in January. You can read that Q&A here.

Inspiring the next generation. Throughout the month of February in observance of Black History Month, PE Hub has been featuring interviews with private equity professionals who are Black.

Today, we conclude our series with a Q&A with Nick Jean-Baptiste, founder and managing partner of Jacmel Growth Partners.

Headquartered in Brooklyn and founded in 2015, Jacmel invests in family-operated, lower-mid-market companies. The firm focuses on “combining traditional private equity best practices with low-cost, high-impact strategies that promote growth while also benefiting employees and their communities,” according to its website. “Since inception, the Jacmel team has invested in eleven companies across five platforms, achieving strong growth, while progressing a range of inclusive economy initiatives, including workforce development, increased Board representation of BIPOC leaders, and educational benefits for employees.”

Here is an excerpt from my interview with Jean-Baptiste:

What’s the biggest mistake PE firms make when it comes to underrepresented groups?

It’s promising that many private equity companies are signing pledges, but there isn’t always long-term thinking. But many firms are only focused on new talent, versus a more concerted effort to attract future private equity firm leaders. One key point is that when you have diverse leaders at the highest levels of a company, then you can inspire the next generation of diverse talent. There is progress being made here as well, as tracked by National Association of Investment Companies.

Finally, another area of improvement is within the portfolio companies owned by private equity firms. If DEI is truly a core value for private equity firms, then they can push for substantial diversification within the companies they acquire across senior management and junior ranks.

As a private equity investor who is Black, are there any experiences or insights you want to share with PE Hub‘s audience?

The biggest challenges for minority investors are overcoming the status quo and combating implicit biases. This can be hard for everyone to understand, but the additional roadblocks are unfortunately felt by nearly all diverse executives within the industry.

This issue can’t be solved overnight, and it’s great to see all the steps taken to embrace diversity and hopefully create a new class of successful diverse-led firms, where this type of implicit bias is no longer felt or important.

For more PE Hub Black History Month interviews, see our Q&As with:

• Chad Strader, managing partner and co-founder of Red Arts Capital

• Milwood Hobbs, Jr,managing director and head of North American sourcing and origination, Oaktree Capital Management

• Tarrus Richardson, CEO of IMB Partners

That wraps things up for today.

Tomorrow, Buyouts’ Chris Witkowsky will write the Wednesday Wire.

All the best,

MK

Read the full wire commentary on PE Hub ...

Also of note (may require subscriptions)

Music royalty investor Lyric Capital nabs $800m for sophomore fund. In recent years, a handful of shops have launched to invest in the royalty-generating creative property of artists and songwriters. (Buyouts)

MiddleGround Capital, which has grown quickly from its early roots as a first-time manager targeting investments in industrials and manufacturing, is preparing its next fundraising round that will target, for the first time, more than $1 billion, a person with knowledge of the firm told Buyouts.

Sabina Sammartino, Mercury Capital Advisors’ head of secondaries advisory who helped build the practice at the firm, is leaving the adviser and placement agent. (Secondaries Investor)

It’s possible that the much-anticipated audited fourth-quarter valuations won’t show the kind of steep write-downs some limited partners are expecting, according to Bain & Co’s latest global private equity report, published this week. (Buyouts)

Spex Capital, a London-based venture capital firm, is seeking to raise €100 million for its early-stage healthcare technology fund. (Venture Capital Journal)

"Oaktree Capital is seeking to raise $10bn for a new fund that will help finance large private equity takeovers, taking advantage of a void on Wall Street as other lenders are sidelined." (Financial Times)

"Peter Clare, one of the most senior dealmakers at Carlyle Group who was passed over as a candidate to lead the US buyout group earlier this month, is retiring after over three decades at the group." (Financial Times)

"Alternative assets manager Investcorp Holdings has closed on more than $1.2 billion in commitments for its debut North America private-equity fund to make control investments in middle-market services businesses." (Wall Street Journal)

The FT gives its readers a primer on equity crowdfunding, which allows investors a low-cost way to invest in private companies.