{"id":33053,"date":"2025-07-03T04:29:39","date_gmt":"2025-07-03T04:29:39","guid":{"rendered":"https:\/\/financialrush.com\/?p=33053"},"modified":"2025-07-03T04:29:39","modified_gmt":"2025-07-03T04:29:39","slug":"private-equitys-clash-of-the-titans","status":"publish","type":"post","link":"https:\/\/financialrush.com\/?p=33053","title":{"rendered":"Private equity\u2019s clash of the titans"},"content":{"rendered":"

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One scoop to start: <\/strong>Private equity groups Advent International and Platinum Equity are vying to buy<\/a> $2bn worth of assets, including the Kevlar bulletproof brand, from DuPont, as the chemicals giant undergoes a wider break-up.<\/p>\n

And another thing: <\/strong>An Apollo-backed insurance group is nearing a \u00a36bn takeover<\/a> of the UK-based Pension Insurance Corporation, a deal that would further push the US alternative assets giant into the UK insurance market.<\/p>\n

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Welcome to Due Diligence, your briefing on dealmaking, private equity and corporate finance. This article is an on-site version of the newsletter. Premium subscribers can sign up here<\/a> to get the newsletter delivered every Tuesday to Friday. Standard subscribers can upgrade to Premium here<\/a>, or explore<\/a> all FT newsletters. Get in touch with us anytime: Due.Diligence@ft.com<\/a><\/p>\n<\/div>\n<\/div>\n<\/div>\n

In today\u2019s newsletter:<\/strong><\/p>\n

The KKR vs Advent deal battle in the UK<\/h2>\n

It\u2019s rare to see two private equity bidders going head-to-head for a buyout deal on the UK public markets.<\/p>\n

But that\u2019s how Wednesday kicked off in London, with the news that KKR <\/strong>had topped a bid<\/a> from rival Advent International<\/strong> with a \u00a34.7bn agreement to acquire the listed industrials group Spectris<\/strong>.<\/p>\n

KKR\u2019s takeover deal, which has the unanimous agreement of Spectris\u2019s board, tops a previously negotiated \u00a34.4bn takeover that was announced last month.<\/p>\n

Spectris, which makes high-tech instruments for various industries, is a typical if larger target for buyout firms in the UK. It\u2019s a non-flashy FTSE 250 constituent that had traded sideways recently.<\/p>\n

Private equity dealmakers have been hunting for targets in the UK\u2019s public middle market, where it can be easier to find attractive deals than in the portfolios of other buyout funds.<\/p>\n

Spectris had been on dealmakers\u2019 radars, but Advent took the market by surprise with a deal that represented an 85 per cent premium to the company\u2019s share price before its interest first emerged. KKR\u2019s new takeover agreement represents a 96 per cent premium.\u00a0<\/p>\n

KKR has been increasing its activity in the face of recent market turmoil, and one of its senior dealmakers previously said that Europe is currently experiencing a revival<\/a> as an investment destination.\u00a0<\/p>\n

\u201cAs a consequence of things like the Draghi <\/strong>report [on competitiveness] and tariffs, Europe\u2019s undergoing a bit of a renaissance,\u201d Tara Davies<\/strong>, co-head of Europe at KKR, told DD\u2019s Alexandra Heal in April.<\/p>\n

The US buyout firm has pursued several transactions in the weeks since Donald Trump<\/strong>\u2019s so-called liberation day tariff announcements, although some have failed to materialise. It recently walked away from a high-profile \u00a34bn rescue deal for the UK\u2019s largest water company, Thames Water<\/strong>.<\/p>\n

It had also sought to buy listed NHS <\/strong>landlord Assura<\/strong>. However, Assura has in recent weeks switched its recommendation to a higher offer from rival Primary Health Properties<\/strong>.<\/p>\n

KKR will now undoubtedly be happy to be the one doing the pipping.<\/p>\n

Thiel-backed bros build an SVB rival<\/h2>\n

Silicon Valley Bank<\/strong>\u2019s collapse in 2023 was a body blow for tech start-ups in the US, leaving many fledgling investors without the access to capital that helped the industry boom over the past two decades.<\/p>\n

Big lenders such as JPMorgan<\/strong> and newer entrants like First Citizens<\/strong>, which relaunched SVB, have tried to fill the gap in the two years since.<\/p>\n

Now a group of billionaires including Peter Thiel<\/strong> are trying to launch their own successor, according to DD\u2019s Tabby Kinder, who scooped the news.<\/p>\n

Thiel\u2019s Founders Fund<\/strong>, together with his Anduril<\/strong> co-founder Palmer Luckey<\/strong> and Palantir <\/strong>co-founder Joe Lonsdale<\/strong>, are teaming up to launch and invest in a bank<\/a> named Erebor<\/strong>, after the famous \u201clonely mountain\u201d in The Lord of the Rings<\/em>.<\/p>\n

It hopes to become the go-to lender for riskier companies and crypto groups that might be rejected by more rarefied institutions.<\/p>\n

The bank\u2019s charter application says it plans to target the \u201cinnovation economy\u201d, with a focus on virtual currencies, artificial intelligence, defence and manufacturing.<\/p>\n

Those are areas of special interest to the group behind the bank. Lonsdale, Luckey and Thiel are longtime crypto advocates and Anduril and Palantir are both defence tech contractors.<\/p>\n

Erebor\u2019s co-founders first discussed launching a bank after SVB\u2019s demise. Its emergence will probably come as welcome news for the early-stage enterprises and venture capital backers that SVB famously bankrolled.<\/p>\n

Wall Street did its best to get a slice of the pie after the Valley-based bank collapsed but never matched up<\/a> to the appeal of the old SVB.<\/p>\n

Luckey and Lonsdale aren\u2019t expected to be involved in the day-to-day operation of the bank. Instead it would be run by co-CEOs Jacob Hirshman <\/strong>and Owen Rapaport<\/strong>.<\/p>\n

Hirschman previously worked as an adviser at crypto group Circle<\/strong>, while Rapaport is chief executive of Aer Compliance<\/strong>, the digital assets software company he co-founded.<\/p>\n

DD hopes that the replica SVB will handle things such as asset-liability management and any potential mismatches better than the original one<\/a>.\u00a0<\/p>\n

Private equity\u2019s M&A roll-ups reach Silicon Valley<\/h2>\n

Venture capital firms are taking a page from the private equity playbook, supercharging start-ups with cash and then merging them to achieve scale.<\/p>\n

It\u2019s a strategy that\u2019s long been used by PE firms to build industry-conquering conglomerates, but marks a new turn for venture capitalists.<\/p>\n

Take Thrive Capital<\/strong>, the group best known for backing OpenAI <\/strong>and Stripe<\/strong>. It\u2019s involved in a $72mn funding round<\/a> for Savvy Wealth<\/strong>, a wealth management start-up.<\/p>\n

That cash will be used to buy up smaller advisory firms, hire individual advisers and integrate AI into the platform\u2019s operations.\u00a0<\/p>\n

And Thrive\u2019s not the only one: General Catalyst<\/strong>, another major VC, has set aside $750mn as part of a plan to roll up call centres, legal services firms and property lettings.<\/p>\n

Other groups exploring the strategy include Khosla Ventures<\/strong>, Bessemer Venture Partners <\/strong>and 8VC<\/strong>.<\/p>\n

The so-called roll-ups offer VCs a chance to breathe new life into a wave of start-up investments made in the go-go years of 2021 and 2022 that haven\u2019t fully scaled.<\/p>\n

Of course, venture capital investors are pinning their roll-up plays on the hot item du jour: artificial intelligence.<\/p>\n

While PE roll-ups often focus on striking waves of debt-funded deals and cutting costs, venture capitalists want to use AI to achieve efficiency and higher margins.<\/p>\n

Not everyone is convinced.<\/p>\n

\u201cI would be sceptical of any strategy that involved transforming a pre-AI business into an AI-based business,\u201d said one US foundation investment head.<\/p>\n

He told DD\u2019s George Hammond that the strategy \u201cwould require the corporate equivalent of a brain transplant\u201d.<\/p>\n

Job moves<\/h2>\n