GIC, the worlds second-largest investor in private equity according to the GI 100, has emerged as an investor in a deal run by KSL Capital to move its ski resort company Alterra out of an older fund and into a continuation pool, sources told affiliate title Buyouts.
The deal is one of the higher profile GP-led secondaries to emerge from the slowdown in activity in the second half of 2022. Continuation fund deals remain popular and may become more so as M&A activity slows and GPs look for ways to hold investments through the down cycle.
GP-led processes like single-asset deals tallied around $52 billion last year, a 24 percent decline from the prior year, according to Jefferies’ full-year 2022 secondary volume report. Evercore found that single-asset deals remained popular, making up about 42 percent of the total $48 billion of GP-led deals last year, according to Evercore’s full-year volume report.
The KSL deal would give investors in an older fund the option to cash out of their stakes in Alterra, or reinvest in the company through the continuation fund. Morgan Stanley is working as adviser on the process.
While the process has a lead investor, Morgan Stanley also ran a process to make sure investors were getting the best price, according to an LP with knowledge of the deal. “It’s kind of in a go-shop period,” the LP said in October. It’s not clear if the deal has closed yet.
A spokesperson for KSL declined to comment. A spokesperson for GIC did not respond to a comment request.
KSL, alongside Henry Crown & Co, began the creation of Alterra in 2017 when it acquired Intrawest, Mammoth Resorts and Deer Valley Resorts. KSL already owned Squaw Valley Alpine Meadows. Then, in 2018, the two firms combined 12 resorts in the US to form Alterra, according to a press release at the time.
Another recent single-asset deal that successfully closed was Lorient Capital’s process for ShiftKey, which provides software helping licensed professionals to connect with healthcare facilities with workforce needs. The deal valued ShiftKey at more than $2 billion, according to a statement earlier this month.
Goldman Sachs and Aviditi Advisors worked as advisers on the deal. The continuation fund deal was led by Ares Management’s secondaries fund and Pantheon along with Lorient. Other investors included Clearlake Capital and Health Velocity Capital.