Actionable Ideas for Companies and Sponsors

Financial Sponsor Go-Private Activity on the Rise

With the roll-out of COVID-19 vaccines, financial sponsors have turned their focus to opportunities in the public market arena. With over $1.6 trillion in dry powder, financial sponsors are focused on opportunities of scale which come with publicly listed companies. Further, with stock market valuations soaring, public company boards are once again willing to engage in dialogue with sponsors. Buyout activity is supported by a strong leveraged financed market environment in which many recent offerings have been substantially oversubscribed. In the three months ending December 2020, over $62 billion in go-privates were announced. This amount exceeds all go-private activity for the year up to September 1.

Recent go-privates of scale include:

  • The $11.6 billion portfolio add-on of Dunkin’ Brands to Inspire Brands, which is owned by Roark Capital; the acquisition of Dunkin’ will add the Dunkin’ and Baskin-Robbins brands to Inspire’s existing portfolio which includes Arby’s, Buffalo Wild Wings, SONIC Drive-in, and Jimmy Johns to create a restaurant colossus representing $26 billion in revenue from over 31,000 restaurants.
  • The $3.0 billion acquisition of Endurance International, a leading provider of cloud-based platforms for small-to-medium businesses, by Clearlake Capital.
  • The $1.4 billion acquisition of specialty building products distributor Foundation Building Materials by American Securities Capital.