Euro funds in the US offer advice (Cinven/CVC)
Guys, am evaluating some opps with euro funds in the US. Any thoughts on Cinven and CVC?
Cinven
Pros:
- 11bn fund in 2019 and good returns
Cons:
- US office opened in 2014
Questions:
- Culture, US returns, B School?
CVC
Pros:
- ~20-22bn fund (committed so far) with great historical returns. US office opened in 08 and they do direct promotes
Questions/Cons:
- US not key focus? or is it? What is culture like
Hi Analyst 1 in IB - Ind, just because I'm a bot doesn't mean I don't have feelings...I'm hoping these links are helpful. If not, feel free to throw monkey shit at me...
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I hope those threads give you a bit more insight.
Anyone
I mean CVC and Cinven (along with Advent) are the powerhouses in Europe, so anybody would be more than happy to choose from one of these; let alone having both offers.
Having such opps, I doubt that the decision should be focused on fund size, but more about (i) team culture (ii) payment structure (how much cash, how much carry (CVC pays early) (iii) what kind of deals are pursued (iv) LT-perspective. One thing I envy about CVC is that they dont shy away in investing in "debatable"-industries - where normally PE wont even touch it for some ESG reasons - CVC doesnt care and has been nailing it (Gaming industry with Tipico, OTA with etraveli, who knows about Rugby?)
Not sure how the picture looks like over the Atlantic. I mean both firms will maintain their European DNA, while the office dynamic might be different than that of an US PE. As a US guy this might be smth to think about.
In the end, you cant go wrong with either of these.
Good insight. And broadly agree. Advent is also top in the us I’d say.
Anyone else? That has dealt with these funds’ US arms?
Also curious
There are differences among the European funds and their presence and focus in the US.
Many of the European funds have entered the US in the past ~10 years so it is a relatively recent phenomenon. Many US funds increasingly encroached on European funds' territory in the past with European-only funds (KKR, Bain Cap, Caryle etc.) and returns in the US have been stronger so many European funds have decided to make the transatlantic move. US pension funds, endowments etc. have been investing in European funds from the beginning, however.
(1) European funds with strong presence in the US and strong focus on investments in the US: Advent, Permira, Apax, EQT. Hours here are pretty similar to large-cap US funds.
Advent started as a Europe-focused/international fund when it came out of TA Associates. Today, it really is a US-first fund with Boston and NYC being the largest offices. Recent big investments - Conservice, Olaplex, Culligan all US-focused. Some of the most successful (Lululemon) also US focused. Having said, recent Thyssenkrupp deal with Cinven suggests that they're still very strong in Europe.
Permira is the 2nd oldest European-US player (along with Apax in ~2001/2). NYC and Menlo Park are the 2nd and 3rd largest offices after London. Recent big investments have all been in the US: Reformation, Cambrex, Lytx. Growth TMT fund is focused on the US.
Apax is similar to Advent and is quite international. OneCall, Cengage, Coalfire (most recent) all US focused. Apax TMT also quite focused on the US.
EQT is the most recent entrant to the US but has made quite a splash. News is that they intend to invest heavily in the US and build quite a team. Recent buyout of Waystar from Bain Cap and sale of Press Ganey with Leonard Green.
(2) European funds with presence but not a strong investment focus in the US: CVC, Cinven (the two you mentioned), Hg, BC Partners
(3) European funds with ~no presence and ~no investment focus in the US: Bridgepoint, Ardian
Good color.
Also PAI has done some hiring in the US and is looking to expand - did a big add on from nestle in us. Hg has also done hiring to expand here. Would put those two in a "wait and see" bucket. Cinven has been hiring and so has CVC.
On CVC would add, a fifth of their last couple funds have been invested in the US - and it is the single biggest country by portcos (Petco, and Alix partners two big names just glancing online) per their website. Of course europe is still ~75% of the portfolio but the above seems a tad dated
For strong/growing focus would add 3i as well who has done major hiring and a number of investments (both infrastructure and traditional PE e.g. smartcarte).
Any color on Partners Group? Seems to be another European giant foraying into the US.
Yup. Missed both PAI and Partners Group. Agreed that CVC is much stronger player in the US than Cinven.
On Partners Group: Unfortunately, they are quite under-the-radar and don't have much direct color.
However, a quick LinkedIn search shows they've build quite a large senior team in Denver. A good sign.
Their two large recent transactions - $2.2bn EyeCare Partners from FFL and $2.4bn Heathside Food along with Charlesbank suggests that they are basically operating like a large-cap US fund buying mature companies along with/from more growth-y middle market firms.
Of their active portfolio companies on their website, they have nearly the same # of companies in the US and Europe. Overall ~45/45/10 US/Europe/Asia. Overall, I'd put Partners in category (1) above, similar to EQT in terms of big recent splashes.
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