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It’s a good time to invest in supply chains. Just ask Capital of the Red Arts.
Last December, the fledgling supply chain-focused private equity firm planned its first exit, agreeing to sell a shipping company bearing the name Midwest Motor Express for $150 million – good for a nearly 8x return. Well, the co-founders of Red Arts Nicholas Antoine and Chad Strader are attempting to raise $225 million for their first institutional fund.
Previously, the pair had raised capital on a deal-by-deal basis from a network of powerful backers, which includes John W. Rogers Jr.founder of Ariel Investments, the oldest black-owned mutual fund company in the country. Fresh out of college, Antoine worked as Rogers’ chief of staff and made a lasting impression on his boss. “He has great judgement,” the famous value investor says of his protégé.
Rogers helped fund Antoine and Strader’s early deals and taught them the basics of professional investing. He also set out a model for helping the next generation of black investors — an example the Red Arts co-founders now want to follow in their own firm.
How are Antoine and Strader navigating their way into the big private equity leagues? And what does Warren Buffett have to do with it? Check out my full story on Red Arts for the answers.
Guild grabs more money
Traditionally, when the economy deteriorates and large companies are forced to cut costs, investing in employee training can be one of the first things to abandon. but Rachel Romer Carlson thinks it will be different this time.
Carlson is CEO and co-founder of guild traininga startup that works with people like Walmart and Disney To connect employees with higher education programs. And she’s not the only one who believes Guild’s model can still thrive in the current environment. Oprah Winfreyis also a believer.
Guild has raised $175 million in Series F funding at a valuation of $4.4 billion Wellington management Chaired a panel that also included Winfrey and a list of other supporters. My colleague Jena McGregor has the scoop on the subject – check out her story on what Carlson and Guild are planning next.
The touch of a mega deal
The biggest deal announced so far this week is an aromatic one. Dutch chemical giant Royal DSM has approved the merger with the Swiss fragrance and flavor specialist Firmenichwith DSM valued at €25.3 billion ($27.2 billion) and Firmenich at €19.3 billion.
In a separate deal, DSM has also agreed to sell its engineered materials business to for nearly €3.9 billion Advent international and Lanxess. The two plan to combine the unit with Lanxess’ existing high-performance materials unit. Taken together, the two steps represent a significant turning point for DSM away from manufacturing plastics and towards manufacturing fragrances for perfumes and flavors for food and beverages.
On Thursday, DSM’s share price in Amsterdam has risen about 7% since the deal was announced, taking its market cap to €27 billion. This is the largest transaction in the fragrances and flavors business since 2019 International flavors and fragrances Paid $26.2 billion DuPont‘s nutrition store.
SPACs not tracked
SeatGeek canceled its proposed $1.35 billion SPAC merger on Wednesday, citing unfavorable market conditions that are “particularly impacting growth technology companies.” The ticket sales startup had agreed to a merger in October RedBall acquisitiona blank check vehicle backed by frequent sports investors RedBird Capitalearlier, former Oakland Athletics general manager Billy Beane and basketball star Kevin Durant.
Elsewhere on Wednesday, forbes also called off its proposed SPAC merger, a $630 million deal Acquisition of the Magnum Opus that was announced in August. In February, binance had agreed to invest $200 million in my employer as part of the SPAC combination; The cryptocurrency exchange told the bloc that they “continue to explore all possible options” regarding a potential investment.
The two deals were canceled the same week that Sen. Elizabeth Waren revealed plans to propose a new law to crack down on blank check transactions. But even without legislation, the SPAC market will continue to cool down.
THL’s automation ambitions
Thomas H. Lee Partners Invests in a little bit of everything: health. enterprise software. financial services. insurance broker. Recently, however, the Boston-based buyout firm has become increasingly focused on automation.
These include the THL Automation Fund, a specialized vehicle that closed in late 2020 with $900 million in commitments. This includes the recent $3 billion acquisition Brooks automation‘s semiconductor automation. My colleague Amy Feldman spoke to two investors at THL about why they are pursuing this particular market opportunity.
“Automation is penetrating all end markets,” says THL Managing Director Jim Carlisle, who heads the Automation Fund. “That’s why it’s such a strong technology trend to invest in.”
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