Deep Value PE firms?
Anyone have any thoughts on funds that traditionally play in the value space? Thinking names like Platinum, Apollo, Cerberus, KPS, Sycamore on the bigger side and HIG, Wynnchurch, Trive, Monomoy on the more MM side. Any thoughts on other firms and how you’d think about these guys?
Siris
value tech take privates which is interesting strategy
Comvest used to do a lot of deep value but stopped.
Everyone hates dealing with HIG and Platinum.
KPS has a gold plated rep, definitely a step above the other two.
Dealt with Platinum twice when I was in IB, both were terrible experiences. Have some friends at HIG and they say it's super sweaty.
Yeah it is very sweaty because IIRC their main fund deploys into deals that are very small cheques relative to fund size. So they end up doing ~30% - 40% more deals than a normal fund would at that size.
Why does everyone hate dealing with Platinum? I heard they shifted their strategy in recent years and aren’t just focused on extreme bargain or broken m&a processes.
They are scumbags that view negotiation as a game. They conduct overly comprehensive diligence on shit that doesn't really matter and try to use that as leverage to fuck the seller any chance they can, whether its related to economic or non-economic terms. Also, their reputation for retrading (similar to H.I.G. and the former Sun Capital) is horrendous.
If you run a good process, there is no reason they should be your final group.
.
sun capital on the MM side
I believe they have shifted strategy a bit, and are now just more MM focused. Historically they were turnaround focused, but the returns suffered quit a bit
This. Thye've undergone a concerted effort/strategy to shed this mentality and reputation and have been overpaying in very competitive auctions across different verticals.
What does "deep value" even mean
For most of those firms it means different things. Over the last 5 years where there wasn't much distress, it tended to mean low multiple buyouts in unloved sectors, corporate carve-outs, and the occasional public-to-private in some value company. In this environment I would expect that more firms pivot toward distressed for control and other special sits.
KPS returns have somehow managed to still be insane even while there strategy wasn't in favor.
helpful
Brookfield also falls under deep value umbrella
Like their corporate PE arm? Can you share any info/details on where they fit in the space? Feel like I don’t here about their PE strat much.
Yes the Corporate PE (buyout). Have their intro deck dated Jan-23: $122bn AUM, latest fund vintage >$10bn, typically focus on following industries: Industrials, Business Services, Healthcare, Infrastructure Services and Technology Services. Typically either buy for value (i.e. cheap) or buy when they have a clear path for value creation (i.e. sending in Ops people to support the business)
Vector is another shop that plays in the deep value tech space
Paceline is another that's a spinout of Lone Star in Dallas
STG and Veritas as well.
STG is a bit smaller than the large players, but is a very solid MM firm with good returns and a good growth trajectory. Veritas is a phenomenal firm with insane returns in the PE world, but they aren't necessarily deep value players more so specialized players with them expanding pretty rapidly out of purely A&D & government services legacy. They do more than deep value buys and would not categorize them in the same space as the firms discussed here; their focus is almost all government related/A&D work and tech-services deals, including like Ed Tech or HCIT.
CD&R and Searchlight comes to mind
Good thread. Kingswood, One Rock, Transom are some other names.
Coverage banker in a space where a lot of these players are interested in:
Apollo, KPS, and HIG are the best deep-value people, IMO. Platnium honestly is great too from the returns perspective but they are a pain in the ass from my perspective as a bank, so out of spite I'll say they are not apart of the top 3 but they realistically are by fund size and performance.
Sycamore's performance leaves much to be desired, and they are significantly smaller than the rest anyway. More of an MM-sized fund and is treated as such by bankers. KPS is prob the best to deal with, and their returns are legendary within the space.
Would note all these firms are naturally very sweaty, but again, they offer good returns for LP, and many promote internally to where you can make a very strong career in the space through going into these seats.
Fascinating - other than size/returns, what would you say separates those groups from others? For example, I’ve never heard a single negative thing about KPS, but can’t say the same about the others when it comes to playing nice in processes. Mainly curious as I’m at a peer/competitor the next rung down from those groups size-wise, though we bump up against them all the time, and am always looking for ways we can compete better.
Magni veniam veritatis ipsum quas aliquam nam autem. Minima cumque ipsa aliquid est perferendis. Veritatis et perspiciatis aspernatur modi ullam voluptate non. Modi ducimus atque voluptatem doloremque ipsam labore rem. Quae laudantium non aut culpa eum.
Autem consequatur omnis harum laudantium magnam sint non. Possimus ut labore aut. Rerum fugit dicta aut porro nisi et. Vel non consequatur quia adipisci voluptatem eum dolor.
Voluptas rerum molestias iusto magni et. Perspiciatis blanditiis recusandae cupiditate numquam nihil. Veritatis facere dignissimos aut culpa est rerum facilis qui. Vitae fuga illum quo deserunt eos voluptatem.
Pariatur rerum dolorum enim nobis. Natus aliquam nisi eos architecto. Ipsa labore modi dolore et iusto enim.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Voluptas officiis aut et esse animi sunt libero. Tempore exercitationem nostrum id aut deserunt dolorem animi. Non et eius quibusdam aspernatur enim.
Repudiandae dolor at officia odit. Reprehenderit asperiores ea mollitia aspernatur.
Repellat beatae qui laboriosam deserunt et reprehenderit commodi. Et sint ex aperiam. Est ullam officia quo consequatur consequuntur maxime possimus. Magnam omnis beatae qui. Et commodi quaerat laborum et vel id reprehenderit.
Eligendi similique facere vel sed minus. Omnis aliquid voluptas accusamus possimus nam qui commodi assumenda. Est dicta iure tempora mollitia aperiam rem aut. Tempora deleniti quisquam ut ipsam. Molestiae nihil id at voluptatem tenetur occaecati. Corrupti ipsam molestiae ex.