Private Equity Firms Investing In Automotive

Date:

Montway And Shipcars Have Been Sold To Aea Investors

India’s Tata Motors to invest over $2 billion in electric vehicle business over next five years

Southfield, MI CFI USA is pleased to announce that it served as the exclusive financial advisor to Montway, Inc. and Ship.Cars in their sale to AEA Investors LP .

Headquartered in Schaumburg, IL and Sofia, Bulgaria , Montway and Ship.Cars combine to offer leading automotive logistics solutions to consumers, auto haulers, and vehicle shippers across North America.

Montway is an asset-light, technology-enabled vehicle broker. It was founded to provide a user-friendly, hassle-free, and reliable platform for individual consumers to transport their vehicles. Since its founding in 2007, Montway has grown to become one of the largest business-to-consumer vehicle transport brokers in the United States.

Leveraging its expertise in data analytics and technology in the B2C market, Montway successfully expanded into the business-to-business sector, diversifying its customer base to serve automotive OEMs and their financial institutions, auction houses, rental car companies, and dealer groups for their vehicle transport needs. Today, Montways service-oriented culture and technology-backed solutions provided by the Ship.Cars technology platform have propelled it to become one of the fastest growing vehicle transport brokers in the United States.

The transaction closed in November 2020.

The testimonials may not be representative of the experience of other clients and are no guarantee of future performance or success.

What To Do Now

Timing is everything in investing, but never more so than during periods of disruption. The trends weve just described will create value and emerging profit pools, but only for firms that develop a robust investment strategy. To get started, leaders might consider the following questions and actions:

  • How will your firms investment appetite and aperture need to change to accommodate the wide range of automotive opportunities currently in play?
  • What emerging opportunities are most relevant to your existing investmentsfor example, adjacent plays, expansions?
  • What capabilities will you need to support your portfolio companies in the face of material technological innovation in the automotive space?
  • Investors that do the upfront work today will be ready to capitalize on key moments as they emerge in the automotive industry and capture strong returns for their stakeholders.

    Trying Times For Automotive And Energy

    Many private equity investments in the industrial sector, notably automotive and energy, have hit challenging times as firms diversify their portfolios away from these industries and business models evolve. A global oil & gas glut, U.S. shale and historically lower prices have dramatically reduced the value of E& P concerns. In automotive, sales are notably reversing following the halcyon days of recent times. The industry-wide shift to electric vehicles is playing a role.

    Jeff HibbelerCEO, SPL Inc.

    Jeff Hibbeler, CEO of SPL Inc., says that while private equity deals are difficult on the oil & gas side, opportunity remains for larger operators to buy at optimal prices. We had our mega downturn in 2015-2016 and then we bounced back in 2017-2019. But 2019 doesnt look great for the smaller and medium-sized operators. I think a lot of people got ahead of their skis. It is a buyers market, particularly in E& P. I think youll see some massive deals soon, in the Permian Basin, for example, with some of the supermajors buying up some of the big independents. Its no longer about price its all about how your business operates.

    Though weve been successful with our most recent fund, its a tough time investing in the hydrocarbon energy space. Weve had success starting companies by being very selective with the sector in which to make the investment and choosing the right management teams to work with. Paul McDermott, Managing Partner, Cadent Energy Partners

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    Today’s Private Equity Investments Include Auto Parts E

    Catch up on the top headlines from Thursday, February 23, 2022 below:

    Greenbriar Drives Auto Parts E-Commerce Growth with Acquisition

    Greenbriar Equity Group, a private equity firm focused on the middle-market, announced Thursday its acquisition of automotive parts retailer and distributor JEGS, with plans to help fuel the businesss expansion and drive the industrys embrace of e-commerce. A press release said JEGS marks the eighth platform investment in the last year.

    As an iconic brand in the performance enthusiast segment, JEGS is extremely well-positioned to take advantage of the continued growth of eCommerce in the broader automotive aftermarket, and we are proud to have been selected as their first institutional partner, said Matt Burke, managing director of Greenbriar, in a statement.

    Heritage Capital Advises on Versatrims Sale to Saw Mill Capital

    Floor moldings manufacturing company Versatrim has been acquired by private equity firm Saw Mill Capital, according to investment banking firm Heritage Capital Group, which advised on the deal. The firms said in a press release Thursday that Versatrim founder and president Thilo Hessler prioritizes high-quality manufacturing and excellent customer service, and sought a buyer with these same principles to take the business top the next level. Saw Mill Capital, which specializes in lower-middle market businesses, did not disclose terms of the deal.

    Alpine Investors Adds to SaaS Portfolio with Aplos Buy

    Shifting Investment And Exit Cycles

    List of Private Equity Firms Investing in Ophthalmology ...

    While the private equity industry continues to make deals, find exits and raise capital, many believe that exit cycles are expanding, as it is taking longer to optimize performance and realize the full transformation potential of investments. The market is demanding high PE multiples over the last few years, as compared with 10 years ago, observes Conor Boden, an Advisor with Advent International. It wasnt easy then, but its become tougher now.

    According to McKinsey, successful exits are becoming far more complex. The past four years saw over 2,000 exits, with the global value of PE exits surpassing $500 billion per year. As the sheer number of deals increases, management teams must think far more critically about how to successfully complete their investment cycles.

    You need to find the right window of opportunity for a value-maximizing exit, asserts Burkhardv. Wangenheim, a Partner with Munich-based private equity firm AFINUM.If you miss that window of opportunity, firms may need to be prepared to wait for another four to five years.

    Danny WeingeistManaging PartnerKayne Anderson

    According to Francesca DArcangeli, Global Leader of Boydens Industrial Practice and a Managing Partner of Boyden United Kingdom, in some cases it depends on the size of the asset base. The greater the capital investment and the size of balance sheets that are the asset base, the longer the cycle needs to be, she says.

    Paul McDermottManaging Partner,Cadent Energy Partners

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    Before Giving Billions To Jared Kushner Saudi Investment Fund Had Big Doubts

    Before committing $2 billion to Mr. Kushners fledgling firm, officials at a fund led by the Saudi crown prince questioned taking such a big risk.

    Crown Prince Mohammed bin Salman of Saudi Arabia with Jared Kushner, a close ally during the Trump administration, and Ivanka Trump.Credit…Jonathan Ernst/Reuters

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    By David D. Kirkpatrick and Kate Kelly

      Six months after leaving the White House, Jared Kushner secured a $2 billion investment from a fund led by the Saudi crown prince, a close ally during the Trump administration, despite objections from the funds advisers about the merits of the deal.

      A panel that screens investments for the main Saudi sovereign wealth fund cited concerns about the proposed deal with Mr. Kushners newly formed private equity firm, Affinity Partners, previously undisclosed documents show.

      But days later the full board of the $620 billion Public Investment Fund led by Crown Prince Mohammed bin Salman, Saudi Arabias de facto ruler and a beneficiary of Mr. Kushners support when he worked as a White House adviser overruled the panel.

      Ethics experts say that such a deal creates the appearance of potential payback for Mr. Kushners actions in the White House or of a bid for future favor if Mr. Trump seeks and wins another presidential term in 2024.

      This Is What Pe Leaders See As Challenges And Opportunities

      We asked 120 private equity executives currently working on ESG investment strategies about the most important and the toughest areas of change when it comes to ESG investing.

      While every PE firm is unique, grouping responses paints a picture of what executives feel is most important to change, versus the level of difficulty of that change. Some highlights:

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      How Private Equity Creates Value

      Private-equity firms perform two critical functions:

      Deal origination involves creating, maintaining, and developing relationships with mergers and acquisitions intermediaries, investment banks, and similar transaction professionals to secure both high-quantity and high-quality deal flow: prospective acquisition candidates referred to private equity professionals for investment review. Some firms hire internal staff to proactively identify and reach out to company owners to generate transaction leads. In a competitive M& A landscape, sourcing proprietary deals can help ensure that funds raised are successfully deployed and invested.

      Additionally, internal sourcing efforts can reduce transaction-related costs by cutting out the investment banking middleman’s fees. When financial services professionals represent the seller, they usually run a full auction process that can diminish the buyer’s chances of successfully acquiring a particular company. As such, deal origination professionals attempt to establish a strong rapport with transaction professionals to get an early introduction to a deal.

      It is important to note that investment banks often raise their own funds, and therefore may not only be a deal referral, but also a competing bidder. In other words, some investment banks compete with private equity firms in buying up good companies.

      Why Grant Thornton Germany

      Trinitas Private Equity acquires a 70% stake in Auto Industrial Group

      Thanks to numerous client engagements, we have gained considerable experience in the private equity industry. In addition to lending classical support to the investment process through due diligence and negotiation assistance, we also assume a value-oriented advisory role for the portfolio company by performing financial statement auditing, tax consulting and restructuring advisory services as well as M& A consulting for sales processes. Furthermore, we audit and provide tax and legal consulting to the private equity firms themselves.

      As one of the first Mittelstand audit firms, we have bundled our multi-faceted experiences from the private equity industry into one industry group. With knowledge of the needs, expectations and challenges of private equity firms, this interdisciplinary team can offer one-stop networked support in all phases of the business cycle.

      Given our client structure, we have an especially high acceptance and comprehensive understanding for the needs of Mittelstand clients and portfolio companies. Fast reaction times and high quality standards are the success factors that distinguish our services.

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      Boost Your Portfolio Outlook

      Our team is ready to help you with a variety of service packages that deliver only what you need to succeed. We can help you deep dive on one investment target, find and vet a group of prospects, guide decisions based on market expertise, and help you avoid contracts pitfalls. From IP analysis to partnership evaluation and technology integration assessment, we are ready to help you today.

      The Automotive Revolution: Can Private Equity Find A Role To Play

      Barely a day passes without reading about a new development in the transition towards the electrification of vehicles. In the UK, all new cars and vans sold in 2030 will need to be hybrid or fully electric. Norway has become the first country in the world where the sale of electric cars has overtaken those powered by petrol, diesel and hybrid engines. In 2020, sales of fully electric and hybrid vehicles in Europe grew by 137% to reach 1.4 million vehicles.

      Jean-Marc Gales has worked at the top of some of Europes largest OEMs, including Mercedes-Benz where he was Global Head of Sales, and PSA where he ran Peugeot-Citroen Automotive globally. His most recent role was as CEO of Lotus Cars, which he ran from 2014 to 2018, turning the business around from loss-making to achieve a successful sale to the Chinese OEM giant Geely. He has recently joined the board of private equity backed EuroGroup, an Italian supplier of components for electric motors.

      Jean-Marc is convinced about the shift we are observing: We are at the start of a disruption which will take 10 years. Some say longer, but I think it will happen quickly. By 2030, we will be close to a fully electrical society, with partly autonomous cars also gaining ground. Decarbonised mobility is going to dominate from now on, and there will be significant changes in consumer behaviour. The last thing my daughter wants, who is at university, is to buy a car. She prefers to use electric scooters and public transport.

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      List Of Private Equity Companies/ Funds In India

      Private Equity is an essential part in understanding the concepts of Finance. There are two types of sources available for any company to raise money one if equity and the other is debt. Wherein, Equity is further divided into two parts Public Equity and Private Equity.

      When a company issues shares through IPO or through any public market, then the equity raised is termed as a Public Equity. However, when it is raised through Private sources or through institutions in a private company, then it is called Private Equity.

      There are various Private Equity Funds that are available across the globe and constantly look for opportunities in private space for funding. Typically Private Equity Investors earn more returns through investing in private companies as they invest in growth companies and not the already matured ones. Their investment tenure varies as per the fund strategy and majority of the private equity players take exit either through IPO or strategic sales.

      Like Investment Banking companies, Private Equity Companies or Private Equity fund houses are located in tier- 1 cities only . If youre looking to join a Private Equity Company as well, then you are required to shift to tier 1 cities only.

      The Private Equity Profession

      Carried Interest Guide for Private Equity Professionals

      The private equity business attracts the best and brightest in corporate America, including top performers from Fortune 500 companies and elite management consulting firms. Law firms can also be recruiting grounds for private equity hires, as accounting and legal skills are necessary to complete deals and transactions are highly sought after.

      The fee structure for private equity firms varies but typically consists of a management and performance fee. A yearly management fee of 2% of assets and 20% of gross profits upon sale of the company is common, though incentive structures can differ considerably.

      Given that a private-equity firm with $1 billion of assets under management might have no more than two dozen investment professionals, and that 20% of gross profits can generate tens of millions of dollars in fees, it is easy to see why the industry attracts top talent.

      At the middle market level$50 million to $500 million in deal valueassociates can earn low six figures in salary and bonuses, while vice presidents can earn approximately half a million dollars. Principals, on the other hand, can earn more than $1 million in compensation per year.

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      Private Equity Takes The Drivers Seat In Italian Automotive Deals

      By Andrea Novarese and Cataldo Piccarreta

      Italy is poised to help steer automotive deal activity in the final weeks of what has been another bumper year for the industry. According to PwC, global automotive deals reached US$59.3 billion in the first three quarters of 2018 marking the highest year-to-date value in a decade. As the end of 2018 approaches, automotive deal value is on course to race past previous years at a promising time for sector consolidation and innovation. In particular, private equity firms are on track to play a crucial role in driving deals in the country as Italian businesses seek external investment.

      A combination of factors is causing Italys automotive companies to increasingly turn to PE funding. For starters, Italys autonomous driving development is moving at the wrong speed. According to Roland Berger in Automotive Disruption Radar #4 , Italy ranks 13th among European countries for electric vehicle public charging infrastructure.

      In addition, Italys automotive industry is highly fragmented and mostly family-owned, which will likely lead to increased demand for investment from financial sponsors. The Italian auto market is currently dominated by small and medium-sized enterprises , many of which will require significant additional capital to develop next-generation products. An increase in deal making is probable as companies seek funding and PE firms scour the market for buyout opportunities.

      Why Private Equity Likes Automotive Retail

      While much of the medias attention is on solutions and companies poised to take advantage of the pending Connected Car era, the investment community has made some big plays in automotive retail technology.

      Within the last 42 months, according to data compiled by The Banks Report nearly $50 billion in capital has changed hands through IPOs, mergers, investments and acquisitions involving automotive retail vendors most of whom focus on technology solutions for car dealers.

      And the trend is likely to continue as numerous P/E firms, hedge funds and other investment companies are taking a hard look at various vendors in the space. The list involves big name firms that have already made big investments Thoma Bravo, KKR, Elliott Management, Vista Equity and Warburg Pincus.

      From our perspective, four dynamics are driving this increased interest from large investors.

      1. First, is the historical dynamic. Over the last decade, investors have made nice returns in the space.

      2. A second dynamic that drives investor interest is the innovative nature of automotive retail technology. The industry is fragmented and entrepreneurial in nature and that has created an innovative mindset. Small entrepreneurial focused individuals come up with an idea, turn it into a solution that dealers and automakers use, and then have been able to sell their companies to larger players.

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