Kapnative Newsletter Edition 30
B&B Hotels Attracts Private Equity Bids Exceeding €3 Billion
B&B Hotels, the French budget hotel chain, has garnered significant interest from private equity firms, with bids exceeding €3 billion. According to a report by the Times, New York-based KKR and Luxembourg-based CVC have submitted offers ranging between €3.2 billion and €3.3 billion. This valuation marks a substantial increase from the €1.9 billion Goldman Sachs paid to acquire the company in 2019.
Founded in Brest, Brittany in 1990, B&B Hotels has expanded its footprint to 17 European countries. The chain currently manages 650 hotels, including 352 in France and 153 in Germany, alongside properties in Italy, Spain, Portugal, the Czech Republic, Belgium, Austria, Poland, and Brazil.
Goldman Sachs, which had anticipated fetching €3.5 billion for B&B Hotels, has received these competitive bids, reflecting the chain's significant growth and appeal. The unnamed sources also noted that PAI Partners, the French private equity firm that sold B&B Hotels to Goldman Sachs in 2019, is reportedly in the running to reacquire the chain.
KKR, known for its investments in companies like the British recycling firm Viridor and the Wella haircare brand, and CVC, currently considering a takeover of the London-listed investment platform Hargreaves Lansdown, are the leading contenders in this bidding process.
The strategic interest from these major private equity firms underscores the strong market position and growth potential of B&B Hotels in the competitive budget hospitality sector.
MIM Closes $1.2 Billion Private Equity Partners Fund II
MetLife Investment Management (MIM), the institutional asset management arm of MetLife, has launched a new $1.2 billion private equity fund of funds, significantly increasing the private capital the insurer manages for external investors. The newly formed MetLife Investment Private Equity Partners II marks a substantial step in MIM's private equity expansion.
The new fund acquired a portfolio valued at approximately $860 million in private equity and equity co-investment interests, with total funded and unfunded commitments of $975 million from MetLife affiliates. This managed secondary sale transaction was anchored by funds managed by Lexington Partners, which served as the lead investor.
To broaden its investor base, MIM syndicated a portion of the transaction to other unaffiliated institutional clients. The fund plans to deploy around $250 million in new private equity opportunities.
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The acquired portfolio comprises nearly 50 private equity and equity co-investments diversified across the globe. This strategic move follows strong returns from MetLife’s general account private equity portfolio, which held $14.3 billion in private equity assets as of March 31, 2024.
MIM’s private equity team has a proven track record, having deployed over $20 billion in alternative investments from 2010 to 2023. Evercore served as the advisor for this transaction, ensuring a seamless and efficient process.
This latest fund underscores MIM's commitment to expanding its private equity footprint and delivering robust returns for its investors.
South Korea’s Hahn & Co Raises $3.4 Billion for New Buyout Fund
Hahn & Co, a leading South Korean private equity firm, has successfully raised $3.4 billion for its latest buyout fund, marking the largest single-country focused vehicle in Asia this year. The fundraising effort, which includes a $140 million co-investment, attracted significant interest from a diverse set of global investors.
According to sources familiar with the matter, Asian investors contributed 35% of the total capital, while investors from the US and Canada accounted for 30%, and those from the Middle East contributed 20%. The fund exceeded its $3.2 billion target, surpassing the $2.8 billion raised by Carlyle Group for a Japan-focused vehicle earlier this year. This success comes at a time when other firms, such as PAG and Carlyle, have faced challenges in meeting fundraising expectations for larger Asia funds.
More than 93% of investors from Hahn & Co’s previous fund, each with commitments exceeding $100 million, have reinvested in the new fund with increased amounts. The firm's reputation for acquiring controlling stakes in subsidiaries of Korea’s family conglomerates and its high distributions to paid-in capital among Asian peers have bolstered investor confidence.
Hahn & Co’s previous $2.7 billion fund from 2019 has already returned 30% of its capital. The company’s first two funds have delivered net returns between 20% and 25%, while the third fund has generated an impressive 31%, according to sources.
Founded by former Morgan Stanley banker Scott Sang-Won Hahn, Hahn & Co continues to demonstrate strong performance and investor trust, solidifying its position as a prominent player in the Asian private equity market.