2 hours ago

Axios Pro Rata

🎧 Next week is the anniversary of the week America changed. The week that schools, sports and companies closed. Tom Hanks got sick. The WHO formally called COVID-19 a pandemic.

  • Axios Re:Cap will air a special series of podcasts — conversations with key decision-makers from that week, telling their stories. We kick off Monday with Sheryl Sandberg of Facebook, one of the first companies to send employees home.
  • Please subscribe
Top of the Morning

Illustration: Aïda Amer/Axios

When it comes to retail and private equity, what's old is new again.

Driving the news: Insight Partners this morning announced that it will invest $500 million in the e-commerce business of Saks Fifth Avenue, which will become a standalone company valued at $2 billion. Saks owner Hudson's Bay will retain a majority stake, while Saks president and CEO Marc Metrick will move over to run the new company.

  • Just days earlier, Apollo Global Management agreed to take Michaels Stores private.

Deja vu: The idea of hiving off a physical retailer's online biz is familiar to anyone around in the waning days of the last millennium.

  • Take-private buyouts of big box retailers is familiar to anyone around in the "Golden Age" of private equity that drove headfirst into the financial crisis.

This time it's different: Insight's Deven Parekh argues that 1990's splits "were really financial engineering deals" in which the parent companies treated their nascent online businesses as second-class citizens.

  • In terms of Saks.com, the new company will control its own merchandising. It also will get to benefit from the brand halo, without also needing to account for legacy leases.
  • In short, it's a primacy reversal.

This time it's different (part II): Michaels and Apollo both have direct experience with this sort of transaction.

  • For Michaels, that was being bought by Blackstone and Bain Capital in 2006 and then going public in 2014. Both the IPO and the Apollo deal value Michaels below the 2006 buyout price.
  • For Apollo, it was the 2006 buyout of Linens 'n Things (RIP).
  • It’s unclear why either expects better results this time around, save for improved e-commerce strategies, particularly given that the crafting market might have just experienced lockdown-fueled highs.

The bottom line: There are history books for Insight and Apollo to read, really serving as cautionary tales. In the very early going, it feels like Insight has taken its more to heart.


Source: Giphy

WhatNot, a livestreamed collectibles marketplace, raised $20 million in Series A funding led by Andreessen Horowitz.

  • Why it's the BFD: This is a reminder that NFTs are complimenting tactile collectibles, not replacing them.
  • Other investors include Operator Partners, Scribble Ventures, YC, Wonder Ventures, Steve Aoki and Chris Zarou.
  • The bottom line: "The company currently focuses primarily on Pokémon cards, Funko Pops, FigPins and sports cards, but they mention things like comic books, video games and vintage hardware as natural fits. Diving into a new category means building up a community for it, convincing trusted sellers to hop on their platform and marketing to the right buyers to make it worthwhile." — Greg Kumparak, TechCrunch
Venture Capital Deals

SiCepat, an Indonesian end-to-end logistics startup, raised $170 million in Series B funding from Falcon House Partners, Kejora Capital, DEG, Telkom Indonesia, Indies Capital, Temasek, Trihill Capital and Daiwa Securities. http://axios.link/giul

Snapcommerce, a Toronto-based mobile shopping experience startup, raised US$85 million. Inovia Capital and Lion Capital co-led, and were joined by Acrew DCF, Thayer Ventures, Full In Partners and insiders Telstra Ventures and Bee Partners. http://axios.link/7zeU

Stream, a Boulder, Colo.-based provider of chat and activity APIs, raised $38 million in Series B funding. Felicis Ventures led, and was joined by insiders GGV Capital and 01 Advisors. http://axios.link/ijHg

Aero, a luxury air travel startup, raised $20 million in Series A funding. Keyframe Capital led, and was joined by Cyrus Capital Partners and Expa. http://axios.link/3iqC

🚑 Halo Dx, an Indian Wells, Calif.-based developer of diagnostic data stream solutions, raised $19 million in Series A funding led by Zola Global Investors. http://axios.link/QtjT

Hepster, a German insuretech platform, raised $10 million in Series A funding. Element Ventures led, and was joined by Seventure Partners, MBMV and GPS Ventures. http://axios.link/x9UG

Elenas, a Colombian social commerce startup, raised $6 million in Series A funding from Leo Capital, FJ Labs, Alpha4 Ventures and Meesho. http://axios.link/SoYC

OpenComp, a San Francisco-based compensation platform, raised $4.6 million is seed funding led by Marc Benioff’s Time Ventures. www.opencomp.com

ClearGlass Analytics, a British pension fund transparency platform, raised £2.6 million from Lakestar and Outward VC. http://axios.link/OpUp

Flourish, a Berkeley, Calif.-based customer engagement platform for banks, raised $1.5 million led by Brazil’s Canary. http://axios.link/Lltm

Private Equity Deals

Aggreko (LSE: AGK), a British provider of portable power generators, will support a £2.32 billion takeover offer from TDR Capital and I Squared Capital, while Platinum Equity reportedly considers a rival bid. http://axios.link/cyol

Altamont Capital Partners and Fortress Investment Group are part of a group that agreed to acquire Austin-based movie theater chain Alamo Drafthouse Cinema, via a prepackaged Chapter 11 bankruptcy. http://axios.link/sF8V

BayPine and TSG Consumer Partners agreed to buy Millwood, N.Y.-based auto services chain Mavis Tire from Golden Gate Capital (which will retain a minority stake). An earlier Reuters report suggesting the deal could be worth more than $6 billion. www.mavistire.com

The Blackstone Group is in talks to buy a minority stake in Indian communication infrastructure firm Sify Technologies, at an enterprise value of at least $1 billion, per Bloomberg. http://axios.link/iqIn

🚑 DCP Capital Partners is in talks to acquire Meihua Hospital, a Chinese chain of maternity and pediatric hospitals, per Bloomberg. http://axios.link/vsFV

KPS Capital Partners agreed to buy the Rolling unit of Norwegian aluminum maker Norsk Hydro for €1.38 billion. http://axios.link/kojq

Public Offerings

Fix Price, a Russian discount retailer, increased the size of its proposed IPO to $2 billion (at an $8.3b market cap), which would be the largest Russian IPO since 2014. http://axios.link/kmMH

🚑 Pathology Asia Holdings, a Singapore-based pathology business owned by TPG Capital Asia, is prepping an IPO, per Bloomberg. http://axios.link/dsbA

SPAC Stuff

Illustration: Aïda Amer/Axios

Cipher Mining, a cryptocurrency mining company formed by Bitfury, agreed to be acquired by Good Works Acquisition (Nasdaq: GWAC) at an implied valuation of around $2 billion. http://axios.link/ZAu1

  • Coming crypto attractions: Check out my interview with Ripple CEO Brad Garlinghouse, on this Sunday night's "Axios on HBO."

🦛 Hippo, a Palo Alto, Calif.-based home insurance startup, agreed to be acquired at a $5 billion implied valuation by Reinvent Technology Partners Z (NYSE: RTPZ), a SPAC co-founded by Mark Pincus and Reid Hoffman. Hippo had raised over $700 million from firms like Propel Venture Partners, Lennar, RPM Ventures, Bond, Dragoneer, Ribbit Capital, Felicis Ventures, Zeev Ventures, Fifth Wall, Comcast Ventures and Mitsui Sumitomo Insurance Co. http://axios.link/87Db

Shutterfly, the photo products company owned by Apollo Global Management, is in talks to be acquired for an implied valuation of between $4 billion and $5 billion by Altimar Acquisition Corp. II (NYSE: ATMR), a SPAC sponsored by HPS Investment Partners, per the WSJ. http://axios.link/wILE

10X Capital filed to raise $250 million and $350 million for its second and third tech SPACs, respectively. http://axios.link/oeub

🚑 Alpha Healthcare Acquisition III, a health care SPAC led by Rajiv Shukla (ex-CEO of Reliance Defense & Engineering), filed for a $150 million IPO. http://axios.link/sx6l

Live Oak Crestview Climate Acquisition, SPAC formed by Live Oak Merchant Partners and Crestview, filed for a $250 million IPO. http://axios.link/Iggd

Model Performance Acquisition, an Asia-focused SPAC led by Claudius Tsang (ex-Templeton Asset Management), filed for a $50 million IPO. http://axios.link/5C67

Liquidity Events

Clayton, Dubilier & Rice agreed to sell Capco, a London-based management and technology consultancy, to Wipro (NYSE: WIT) for $1.45 billion. www.capco.com

Clearlake Capital Group and TA Associates are seeking a buyer for DigiCert, a Lehi, Utah-based online authentication company that could fetch around $8 billion, per Bloomberg. http://axios.link/b46M

TDR Capital is considering exit options for Dutch fleet management firm LeasePlan, which could fetch more than $10 billion, per Bloomberg. http://axios.link/xQwr

More M&A

🚑 Agilent Technologies (NYSE: A) agreed to buy Resolution Bioscience, a Redmond, Wash.-based liquid biopsy developer, for upwards of $695 million (including $550m upfront cash). http://axios.link/ic7K

Onward Holdings, a Japanese apparel maker, agreed to sell its Jil Sander brand to Italian group OTB. http://axios.link/ytOv

Raytheon (NYSE: RTX) is considering a $1 billion sale of its services unit, per Bloomberg. http://axios.link/4iHQ

WeCommerce (TSX: WE) agreed to buy Stamped.io, a Singapore-based e-commerce marketing platform, for up to US$110 million. www.wecommerce.co


BlockTower Capital raised a $25 million fund focused on decentralized finance, or "DeFi," projects and assets, per Axios. http://axios.link/GLpj

Newbury Partners secured $1.3 billion so far for its fifth private equity secondaries fund, which is targeting $1.75 billion, per an SEC filing. www.newbury-partners.com

PSL Ventures of Seattle raised $100 million for a new fund focused on Pacific Northwest startups. www.psl.com

It's Personnel

Katie Chan stepped down as a Hong Kong managing director for placement firm Probitas Partners, per PE International. www.probitaspartners.com

KKR named two independent directors: Arturo Gutiérrez, CEO of Coca-Cola bottler Arca Continental, and Dane Holmes, CEO of Askalera. www.kkr.com

Deborah Shufrin is joining Colby College as chief investment officer. She previously was deputy CIO at Brandeis University. http://axios.link/ASnP

Final Numbers
Data: FRED; Chart: Axios Visuals

February jobs report:

  • +379k jobs, more than double economist estimates. January's number was +49k.
  • Unemployment down from 6.3% to 6.2%.

Go deeper: Vaccine dreams juice jobs

Thanks for reading Axios Pro Rata! Please ask your friends, colleagues and shopaholics to sign up.