CCMP Capital is looking for more time and money to grow two companies it bought in the past few years, as managers of all sizes turn to the secondary market to sort out older investments.
CCMP’s deal, which could total $1 billion or more, is one of a flood of single-asset and concentrated-asset deals on the market. The market is saturated with GP-led deals, sources told affiliate Buyouts, to the point that many deals either won’t get done or will take longer than expected, they said.
GP-led deals like CCMP’s anticipated process represented a much larger portion of secondaries deal volume last year and this year to date. However, that balance is shifting as traditional LP portfolios have made a comeback in the second half of the year.
It’s not clear if CCMP’s deal is live in the market or if the firm is still considering the transaction. The deal would involve two assets: BGIS, which provides facility management services, and Truck Hero, which provides aftermarket accessories for pick-up trucks and jeeps. CCMP invested in BGIS in 2019 and in Truck Hero in 2017.
The two assets are held in CCMP’s third fund, which closed on $3.6 billion in 2014. Fund III was generating a 12.7 percent gross internal rate of return and a 1.63x gross multiple as of 31 December 2020, according to performance information from the City of San Jose Police and Fire Department Retirement Plan.
The deal would allow existing LPs in Fund III to either cash out of their interests in the two assets, or reinvest in them through the continuation fund. Jefferies is working as secondaries adviser on the deal, one of the sources said.
A representative from CCMP declined to comment.
Secondaries volume in the first half was estimated at around $50 billion, according to Campbell Lutyen’s half-year volume report. GP-led deals accounted for around 55 percent of total volume, the report said.
Single-asset deals themselves represented about 40 percent of total GP-led deal volume, the report said.
Other firms either considering single- or concentrated-asset deals either in market with them include Corsair Capital, which is eyeing a process for asset manager First Eagle; and Centerbridge Partners and Vistria Group, which plan to run a secondaries process on Sevita.