Centerview Unit to Launch Blank-Check Company
May 27 2016 - 4:40PM
Dow Jones News
Another big name Wall Street firm is expected to launch an
acquisition vehicle that would give it a "blank check" to make
deals.
Centerview Capital Holdings LLC, the private-equity arm of
mergers-and-acquisitions advisory firm Centerview Partners, is
planning to launch a blank-check company that would buy
consumer-products companies, according to people familiar with the
matter. Blank-check companies raise money in public offerings to
spend on future acquisitions.
Jim Kilts, a Centerview Capital partner and former Gillette Co.
chief executive, is expected to help lead the venture, which could
launch as soon as July, the people said. Centerview will seek to
raise about $300 million in the offering, one of the people
said.
Centerview has tapped Deutsche Bank AG and Goldman Sachs Group
Inc. to underwrite the deal, according to people familiar with the
offering.
Special-purpose acquisition companies, as they are also known,
are making a comeback during an otherwise lackluster IPO market,
and some well known names on Wall Street are joining the wave.
Centerview Partners, founded by investment bankers Blair Effron
and Robert Pruzan, has advised on some of the largest M&A deals
of the past decade, including General Electric Co.'s sale of
roughly $200 billion in GE Capital assets and Time Warner Cable
Inc.'s $55 billion merger with Charter Communications Inc.
Mr. Kilts joined Centerview in 2006, shortly after the advisory
firm's launch, to build out its private-equity arm. Centerview
Capital now has roughly $500 million in committed capital,
according to its website.
SPACs raised $3.9 billion in 20 deals in 2015, their busiest
year since before the financial crisis, according to Dealogic. So
far this year, five SPACs have raised roughly $1.5 billion in
public offerings.
Landcadia Holdings Inc., a blank-check company formed by the
CEOs of Jefferies Group LLC and Landry's Inc., this week raised
$250 million in an IPO for possible acquisitions in the dining,
hospitality, entertainment and gaming industries, according to
regulatory filings. Last week, a blank-check company run by former
Blackstone Group LP partner Chinh Chu and Fidelity National
Financial Inc. Chairman William Foley raised $1.12 billion,
including $515 million from a private group of investors.
Private-equity firms have been particularly active in the SPAC
market, as both buyers and sellers. TPG launched a SPAC in 2015,
and earlier this year it sold a majority stake in one of its
portfolio companies to a blank-check company controlled by
billionaire investor Wilbur Ross. Energy-focused Riverstone
Holdings LLC owns 20% of a SPAC launched in February to buy up oil
and gas assets.
Because the companies have no operations at first, investors who
buy SPAC shares are betting on the investing prowess of their
sponsors and their target industries.
The Centerview SPAC will target consumer-products companies, an
area of strength for Mr. Kilts. He sold Gillette to Procter &
Gamble Co. in 2005 in a deal valued at roughly $54 billion,
creating the world's largest consumer-products enterprise.
Write to Maureen Farrell at maureen.farrell@wsj.com and Dana
Cimilluca at dana.cimilluca@wsj.com
(END) Dow Jones Newswires
May 27, 2016 16:25 ET (20:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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