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BlackRock joins Apollo on Behrman electronics deal

The $500m deal centred on Micross Components, which has grown its revenue 10x over the last five years.

BlackRock has emerged as an anchor investor on a single-asset deal involving a top-performing microelectronics business, six weeks after Secondaries Investor reported that Apollo Global Management was backing the process.

The world’s largest asset manager, which is investing its debut Secondaries and Liquidity Solutions fund, joined Apollo in backing $500 million continuation vehicle Behrman Capital Micross CF alongside other new and existing investors, according to a statement.

Secondaries Investor reported in January that Apollo was backing the deal to transfer Orlando-based microelectronics business Micross Components out of Behrman Capital VI into a single-asset vehicle. It is understood the deal gave Micross an enterprise value of $800 million. Jefferies advised.

This is at least Apollo’s second GP-led deal, both of which have been technology focused. Secondaries Investor reported in May that it was set to lead its first deal in the private equity secondaries market, moving online advice platform Ingenio out of Alpine Investors’ 2013-vintage fund into a continuation fund. Apollo’s GP solutions team, which is understood to have seed capital from the firm’s Hybrid Value fund, backed the deal.

A spokesman did not confirm whether the capital for the Micross deal came from the Hybrid Value fund, which offers mixed debt and equity financing. Partner Jason Scheir said in the statement that the deal is “indicative of the solutions Apollo provides to GPs as a value-added capital partner”.

The 2017-vintage Behrman Capital VI closed on $421.8 million, according to PEI data.

Behrman acquired Corfin Industries in 2018. The business merged with Micross Components in 2020, allowing Micross’s owner Insight Equity to exit. The company has increased its revenue by 10 times since 2018, according to a spokesperson for Behrman.

Behrman has run a GP-led secondaries deal before. In 2012 it completed a $1.2 billion restructuring on its 2000-vintage Fund III, Secondaries Investor reported. Cogent Partners, whose core team is now at Jefferies, advised on the process led by Canada Pension Plan Investment Board. That team also advised on this deal. Goodwin Procter and Ropes & Gray served as legal counsel for Behrman.

Secondaries professionals report they have been seeing impact from the public markets volatility that have roiled markets since the beginning of the year, affiliate title Buyouts reported last week. Pricing had been rich for buyout funds as of the fourth quarter, and buyers and sellers are watching closely to determine how exactly to price assets and portfolios.

It is unclear which reference date was used to price the Micross continuation vehicle. Apollo did not respond to a query by press time and Behrman declined to comment.