The Economy is Private

Author

Litquidity Capital
December 11, 2024

Together with

Good Morning,

KKR wants PE in 401(k)s, Blackstone expects US PE exits to double next year, Wall Street sees the hottest money in private markets, Goldman expects 2025 dealmaking to surpass 10-year averages, and SpaceX's latest tender made it the world's most valuable private startup.

With private markets being the hottest topic on the street, it's time to check out 10 East, a membership-based investment platform offering targeted exposure to PE, VC, and more.

Let's dive in.

Before The Bell

As of 12/10/2024 market close.

Markets

  • US stocks slipped further yesterday as investors awaited today's CPI report 

    • Dow notched a four-day losing streak

    • Short interest on the Nasdaq dipped 0.8% in late November

  • UK's FTSE 100 suffered its worst day in four weeks

  • Europe's Stoxx 600 broke an eight-day win streak

  • Aussie dollar hit a four-month low on expectations of a dovish central bank

  • Crypto volatility picked up as Trump-fueled rally starts to wear

Earnings

  • AutoZone missed Q1 EPS and revenue estimates due to higher raw material prices and a stronger dollar (RT) 

  • GameStop reported a surprise Q3 profit, though it missed revenue estimates with a 20% YoY sales decline (BRN) 

  • What we're watching this week:  

    • Today: Adobe, Macy's 

    • Thursday: Costco, Broadcom

  • Full calendar here

The Litquidity Portfolios

  • Litquidity recently released three thematic portfolios that give retail investors the ability to seamlessly copy them in their personal accounts (via Autopilot's technology).

  • The three strategies are:

    • 1) Litquidity Alpha - portfolio of Lit's highest-conviction stock holdings, positioned to benefit from the incoming US administration and advances in emerging technologies such as AI, defense tech, and crypto

    • 2) The Basic Becky Index - captures the latest consumer trends, pop culture staples, and investment preferences of the "everyday Gen Z / millennial"; a basket of stocks spanning consumer & retail, e-commerce, tech, media / social, and more

    • 3) The Finance Chad Index - curates companies that professional men consume and engage with on a regular basis; a basket of stocks spanning AI, financial institutions, consumer goods, food & bev, transportation, and productivity tools

  • To invest alongside Litquidity's strategies, head on over and subscribe on Autopilot. They'll handle the rest!

Headline Roundup

  • US regulator warned remote work could hurt audit quality (FT)

  • US small business sentiment surged to a 3.5-year high (RT)

  • Australia left rates unchanged at 4.35% (RT)

  • Goldman expects 2025 dealmaking to surpass 10-year averages (RT)

  • Goldman expects more large-scale strategic M&A in 2025 (RT)

  • Blackstone expects US PE exits to double next year (RT)

  • KKR CEO makes case for private assets in 401(k)s (BBG)

  • Wall Street wealth chiefs see hottest money in private markets (BBG)

  • Abu Dhabi's $1T SWF seeks more innovation in private credit (BBG)

  • Texas Stock Exchange will open a temporary HQ in Dallas next year (BBG)

  • US high-yield credit is set for best returns in eight years (RT)

  • Volume of structured finance deals hit the highest since 2007 (FT)

  • BlackRock sees investors shifting from cash despite 'modest' rate cuts (RT)

  • Munis ETF launches hit a record high (BBG)

  • Jefferies co-head of IB Alejandro Przygoda will depart (BBG)

  • ​​JPMorgan expects IB fees to rise 45% in Q4 (RT)

  • Government debt glut could rock bond markets in 2025 (RT)

  • Apollo is expanding its 'hybrid' credit, equity business (BBG)

  • Trump named Andrew Ferguson as FTC chair (BBG)

  • PNC sees banks with core retail deposits as M&A targets (RT)

  • UBS overhauled its US wealth business to include less-wealthy clients (WSJ)

  • CPPIB's Asia PE head becomes latest to leave for Middle East (BBG)

  • Google is making its biggest bet on search AI (RT)

  • Amazon entered car sales (TC)

  • GM will wind down its robotaxi business (BBG)

  • Trump has named seven billionaires to his administration (BBG)

A Message from 10 East

Where Sophisticated Investors Access Private Markets

10 East is a co-investment platform where sophisticated investors access private market investments alongside a veteran team with a 12+ year track record of strong performance across over 350 transactions. The firm is led by Michael Leffell, former Deputy Executive Managing Member of Davidson Kempner.

Members have the flexibility to participate on a deal-by-deal basis across private equity, credit, real estate, and venture capital.

Benefits of 10 East membership include:  

  • Flexibility – members have full discretion over whether to invest on an offering-by-offering basis. 

  • Alignment – principals commit material personal capital to every offering.  

  • Institutional resources – a dedicated investment team that sources and diligences each offering.

There are no upfront costs or commitments associated with joining 10 East.

Exec Sum readers can join 10 East with complimentary access here.

Deal Flow

M&A / Investments

  • A judge blocked Kroger's $24.6B acquisition of Albertsons

  • US plans to formally block Japan's Nippon Steel's $14.1B acquisition of US Steel on national security grounds

  • Saudi Arabia's PIF is nearing a deal to acquire a 6% stake in PGA's commercial arm PGA Tour Enterprises at a $12B valuation

  • PE firm Sycamore is in talks to acquire $9B-listed struggling pharmacy chain Walgreens Boots Alliance

  • Japan's Nippon Life Insurance plans to buy global peer Resolution Life for $8.2B from shareholders including Blackstone

  • Denmark's largest mortgage lender Nykredit Realkredit agreed to buy rival Spar Nord Bank in a $3.5B cash deal

  • Prudential is considering selling a 30% stake in its Singapore-based asset manager Eastspring Investments at a $3B valuation

  • Advent, Apollo, and CD&R are exploring bids for $2.2B-listed uniform maker Vestis

  • Cybersecurity giant Gen Digital agreed to acquire fintech MoneyLion in a $1B cash deal 

  • PE firm Story3 Capital Partners made a ~$1B takeover offer for medical-apparel maker Figs

  • Brookfield acquired a US student-housing portfolio for $893M

  • Infrastructure investor I Squared is looking to make an offer for $880M-listed Hong Kong Broadband Network

  • German remote-work software firm TeamViewer agreed to buy autonomous DEX firm 1E from Carlyle for $720M

  • China's Fosun Tourism offered to buy back shares from minority shareholders at a $640M valuation as part of plans to delist

  • Domino's and PE firms KKR, Sixth Street and TSG Consumer Partners are bidding for Wingstop's UK franchise which could fetch a $511M valuation

  • Food investment firm McWin Capital Partners is in talks to buy UK bakery chain Gail's

  • Italy is preparing to sell a minority stake in rail operator Ferrovie dello Stato

  • European discounter Pepco is considering options for its struggling Poundland chain in UK

VC

  • Musk's SpaceX will buy back employee shares at a $350B valuation

  • Clean energy firm Intersect Power raised an $800M round led by TPG Rise Climate

  • Speak, an AI language learning startup, raised a $78M Series C at a $1B valuation led by Accel

  • CarDekho, a Singaporean auto financing service platform, raised a $60M round at a $300M+ valuation from Navis Capital Partners and Dragon Fund

  • Astrix Security, an identity security platform for the AI era, raised a $45M Series B led by Menlo Ventures

  • TruVideo, an AI and AR-driven communication platform for the transportation industry, received a $40M growth investment from TZP Growth Equity

  • AQEMIA, a startup combining quantum mechanics and AI for drug discovery, raised a $38M round led by Cathay Innovation

  • Raptor Maps, a startup building an integrated OS for the solar industry, raised a $35M Series C led by Maverix Private Equity

  • WeaveGrid, a software company enabling EV adoption on the electric grid, raised a $28M round led by Toyota's growth fund Woven Capital

  • Stainless, an AI software startup building SDKs for GenAI firms, raised a $25M Series A led by a16z

  • Thoughtful AI, an AI-powered revenue cycle transformation startup, raised a $20M Series A led by Drive Capital

  • Ask Sage, a GenAI platform for government and commercial use, raised a $17M Series A led by Sapphire Ventures

  • Gavan, an Israeli food tech startup, raised an $8M Series A led by MoreVC

  • Partful, a UK startup specializing in interactive 3D technology, raised $6M in funding led by Northern Gritstone

  • GovSignals, a startup leveraging data across the government to generate compliant proposals, raised a $5.5M seed round led by Unusual VC

  • Mainframe, a startup designing generative productivity software, raised a $5.5M seed round led by Stellation Capital

  • DeFi platform Smardex raised a $4.5M public seed round led by RA2 TECH

  • Contextual AI and data loss protection startup Wald raised a $4M seed round from Inventus Capital, Entrada Ventures, and others

IPO / Direct Listings / Issuances / Block Trades

  • Home services software firm ServiceTitan raised its IPO price, now seeking to raise $590M at a ~$6B valuation

  • Chinese cosmetics firm Mao Geping jumped 85% in its trading debut after its $300M Hong Kong IPO

  • Egypt's state-owned United Bank raised $90.5M in a local IPO

  • Portuguese bank Novo Banco is ready to explore an IPO

  • Food outlet operator SSP Group is planning an Indian IPO of airport lounge operator Travel Food Services

SPAC

  • Japanese crypto exchange Coincheck will list in US in a $1.3B merger with Thunder Bridge Capital Partners IV

Debt

  • Mars is seeking to raise $1B in investment-grade private credit to help finance its $36B acquisition of food maker Kellanova

  • Bank of America sold $1B of bonds as part of Ecuador’s debt-for-nature swap

  • London's Canary Wharf district will raise $777M from Apollo to repay debt

Bankruptcy / Restructuring / Distressed

  •  Party City is planning a second bankruptcy filing in just two years

Fundraising

  • J.F. Lehman & Company, a MM PE firm focused on aerospace, defense, and the environment, closed its sixth flagship fund at $2.2B

Crypto Corner

  • Microsoft shareholders rejected a proposal to invest in Bitcoin (AX)

  • El Salvador and Argentina regulators sign agreement to help develop crypto industry (CD)

If you want to stay up to speed on crypto, subscribe to our crypto-focused newsletter. The same Exec Sum format, dedicated to crypto news.

Exec’s Picks

Financial Services Recruiting 💼

If you're a junior banker looking for your next career move, check out Litney Partners, a recruiting firm established by Litquidity and Whitney Partners (the oldest purely financial services executive search and consulting firm).

We aim to place strong candidates across private equity, hedge funds, venture capital, growth equity, credit, and investment banking.

We're currently seeking talent for some incredible roles. Head over to Litney Partners to drop your resume / create your profile and we'd love to get in touch!

Meme Cleanser

🛒 Merch Store: Visit our merch store to shop our latest apparel, shoes, bags, accessories and more. 

💵 Litquidity Ventures: Accredited investors & qualified purchasers within the Litquidity community can gain access to alternative investments such as venture, late-stage growth, and private equity through Litquidity Ventures. Interested? Fill out this form.

☎️ Book a call with Lit: Want to pick Litquidity's brain on business advice, insights, or just chat to say what's up? Buy his time here.

📧 Launch your own newsletter: Have great content ideas and looking to launch your own publication? We highly recommend Beehiiv to get started.

Reply

or to participate.