Investments

Private Equity Co-Investments

Buyout of Middle Market European Online Retailer

euro-online-retailer

Type: Co-investment
Date: October 2016
Sector: Retail
Geography: Europe

Overview

  • Buyout of rapidly growing online retail business in middle market Europe
  • The business is a leading Nordic online retailer of home improvement products
  • Strong online presence with 17 sales websites, 680,000 active customers, 31% repeat orders, and 1.5 visits per second
  • Additional sales from 21 physical stores, which support the websites and act as showrooms for its top products

Investment Rationale

  • Rapidly growing business with strong management team and significantly positive customer feedback
  • Company has consistently remained a leading online retailer in its product segments
  • Strong tailwinds as market segment is less cyclical than broader retail, and online penetration expected to reach developed market levels
  • Trusted fund partner with expertise and experience investing in middle market Nordic companies, and executing on rapid growth plans

Corporate Carve-out of Software Businesses

software-business

Type: Co-investment
Date: October 2016
Sector: Technology
Geography: USA

Overview

  • Complex carve-out of the software division of a large technology company consisting of seven unique software business lines
  • The businesses acquired span a range of infrastructure software markets, including Windows Management, Information Management, Endpoint Management, Performance Monitoring, Data Protection, Identity and Access Management and Network Security

Investment Rationale

  • The complex nature of the transaction enabled Caledon’s partner to acquire the business at an attractive entry multiple
  • The businesses generate ~$350 million of EBITDA across a diverse set of end markets and use cases
  • Approximately 55% of revenues are recurring, and the combined businesses serve over 180,000 customers across 60+ countries with limited customer concentration
  • Significant potential for performance improvement given fund partners experience of optimizing similar businesses
  • Trusted, experienced fund partner with expertise and experience in executing corporate carve-outs

Central USA Physiotherapy Clinic Chain

clinic-chain

Type: Co-investment
Date: June 2014
Sector: Medical Services
Geography: USA

Overview

  • Provider of outsourced rehabilitation services in the Midwest operating 80 physical therapy clinics
  • The company has 212 licensed athletic trainers working with over 180 affiliations and an established base of over 8,000 referring physicians

Investment Rationale

  • Partnership with a strong performing fund manager well known to Caledon with significant experience evaluating the physical therapy sector
  • Attractive overall returns to equity with modest leverage in a stable and growing business
  • Healthy industry dynamics with strong growth forecast throughout the hold period
  • Experienced management team with a proven track record and a well-differentiated business model

Upstream Oil and Gas Asset Operator

gas-asset

Type: Co-investment
Date: December 2013
Sector: Energy
Geography: USA

Overview

  • Company backed by a well-known private equity fund manager to acquire and operate upstream oil and gas assets in the southern US
  • The Company will target assets with 30% – 60% proved, developed and producing low-risk reserves while developing the remaining proved, undeveloped reserves using the management team’s operational skills
  • The Company will be led by the former management team of a well-known US petroleum company

Investment Rationale

  • Partnership with a strong performing fund manager well known to Caledon with significant experience backing businesses and management teams in need of capital to drive growth
  • Attractive overall returns to equity with modest low-cost leverage
  • Experienced management team with a proven track record investing and operating oil and gas assets in the target basin

Private Equity Fund Commitments

European Mid-Market Manager

european-manager

Type: Fund
Closing Date: May 2016
Strategy: Buyout / Growth
Geography: Europe

Overview

  • Established new relationship with a sought-after European niche-focused manager based in France
  • Sixth generation fund focused on investing in global B2B businesses headquartered in targeted European geographies
  • Caledon’s clients received desired allocations despite a significantly oversubscribed fundraise

Investment Rationale

  • Highly sought after mid-market manager who consistently demonstrated exceptional performance through various economic cycles
  • Very low loss ratio
  • Exposure to global market-leading B2B businesses headquartered primarily in French-speaking Europe, a region that has historically been difficult to access for “non-local” managers
  • Opportunity for co-investment

Distressed / Special Situations Fund

prime-sport

Type: Fund
Closing Date: June 2015
Strategy: Distressed and special situations investments
Geography: North America

Overview

  • Investment with an existing Caledon manager relationship
  • Secured desired allocations in an oversubscribed fundraise for Caledon clients
  • Fourth generation fund of a very highly sought-after manager with strong track record, experienced team, and a differentiated strategy targeting distressed and special situations private equity investments in North America

Investment Rationale

  • Caledon diligenced the manager extensively in 2011 / 2012 and committed to the previous fund when the GP was significantly less proven and well-known
  • Caledon consistently maintained close dialogue with senior professionals, and served on the Fund’s LPAC
  • Caledon recognized the opportunity required urgency and pro-actively diligenced the opportunity; completed full due diligence and negotiations for several clients within the manager’s tight fundraising process to make the pivotal first closing and maintain an LPAC seat

Deep Value Fund

deep-value-fund

Type: Fund
Closing Date: November 2014
Strategy: Middle Market Value-Oriented Buyouts
Geography: North America

Overview

  • Investment with an existing Caledon manager relationship
  • Secured allocations in an oversubscribed fundraise for two Caledon clients – one existing LP, one new LP
  • Fourth generation fund of a very highly sought-after manager with strong track record, experienced team, and a differentiated strategy targeting value-oriented, operationally focused investments in North America

Investment Rationale

  • Caledon diligenced the manager extensively in 2009 / 2010 and committed to its previous fund when the GP was significantly less proven and well-known
  • Manager subsequently ranked as a most consistent top performer by Preqin
  • Caledon had consistently maintained close dialogue with senior professionals, and served on the Fund’s LPAC
  • Caledon recognized the opportunity required urgency and certainty of closing; Completed full due diligence and negotiations for two of Caledon’s client mandates within the manager’s exceedingly tight fundraising process to make the “one-and-done” closing, and maintain an LPAC seat

Trans-Atlantic Fund

trans-atlantic

Type: Fund
Closing Date: January 2013
Strategy: Flexible Capital
Geography: North America, Europe

Overview

  • New private equity fund relationship for Caledon’s clients
  • Fourth generation fund of a very highly sought-after manager with strong track record, large and experienced team, and a differentiated strategy focused on complex / flexible capital investments in North America and Europe

Investment Rationale

  • Caledon team members had invested with and known the manager in previous roles and been a board member on one of the portfolio companies
  • Caledon had consistently maintained dialogue with senior professionals as the manager prepared to launch a new fund in the fall of 2012
  • Caledon recognized the opportunity required urgency and certainty of closing; Completed full due diligence and negotiations for two of Caledon’s clients mandates within the manager’s three-month fundraising process to make the “one-and-done” closing