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Why Sovereign Funds are Cold on Deutsche Bank

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Very few sovereign funds are heavily invested in Deutsche Bank stock. One can count Norway Government Pension Fund Global, but that sovereign fund is invested in all major European listed equities. The Qatar royal family through vehicles remains a top shareholder and HNA Group peaked up, holdings its shares of the German bank in a complex structure.

Post global financial crisis, Deutsche Bank recruited a bank veteran who had worked at Temasek Holdings – John Cryan – to try and turn the ship around dubbing a program called “Strategy 2020”. Unlike Credit Suisse and UBS, which had resilient private banking franchises to fall back on, Deutsche Bank was overly anchored in trading and investment banking revenues. Cryan’s cost-cutting measures involved selling off business units, assets, solving outstanding legal headaches and layoffs. In 2016, Deutsche Bank was at an inflection point as its stock dropped precipitously and the CoCos (contingent convertible capital instruments) payment scare story flooded financial media, after announcing its first full year loss since 2008. Sovereign funds, especially ones in the Middle East, have an aversion to invest in large Western financial institutions. Many sovereign funds got burned in the global financial crisis – one can recall the Abu Dhabi Investment Authority losing big in Citigroup. Sovereign funds would rather be the contrarian capital, picking up the pieces in broken down entities or cherry picking distressed assets from banks.

Armed with a new CEO, Christian Sewing, the bank’s stock got hammered in May in the equity markets, nearing a market capitalization equivalent to Twitter. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Antares Bain Capital Complete Financing Solution Backs symplr Deal

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On December 10, 2018, Antares Bain Capital Complete Financing Solution provided a senior secured unitranche credit facility for Clearlake Capital Group, L.P. to acquire symplr, a healthcare governance, risk, and compliance software-as-a-service platform from Pamlico Capital and The CapStreet Group. Golub Capital provided financing for the transaction as well.

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PSP Investments Exits Antelliq

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On December 14th, Private equity firm BC Partners, Public Sector Pension Investment Board (PSP Investments), and other minority co-investors have signed a definitive agreement with Merck, known as MSD outside the United States and Canada, to sell Antelliq Corporation, a Vitré, France-based provider of digital animal identification, traceability, and monitoring solutions. Upon close, Antelliq will be a wholly owned and separately operated subsidiary within the Merck Animal Health Division. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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JPMorgan Edges Out Hamilton Lane on Florida SBA In-State Mandate

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The Florida State Board of Administration (SBA) manages a plethora of Florida state funds, including the state’s defined benefit plans. Florida’s SBA awarded a private equity portfolio mandate which targets high-technology businesses in Florida to J.P. Morgan Asset Management. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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