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KKR follows peers with changing of the guard; VC post-money valuations soar

S&P Global Market Intelligence offers our top picks of global private equity news stories and more published throughout the week.

A signal that private equity is moving to the next stage came after KKR & Co. Inc.'s founders and senior leaders Henry Kravis and George Roberts stepped down as co-CEOs, handing off to co-presidents and co-COOs Joe Bae and Scott Nuttall.

Kravis and Roberts plan to "remain actively involved" in the business, taking up the role of executive co-chairmen of KKR's board as the next generation takes over. KKR's business model has evolved dramatically during the leadership of Kravis and Roberts, who oversaw, for example, the transformation into a publicly listed firm and the balance sheet acquisition of insurance company Global Atlantic Financial Group Ltd.

The planned succession follows peer firms The Carlyle Group Inc. and Apollo Global Management Inc., whose founders also handed the reins to the next generation.

CHART OF THE WEEK: Startup valuations take flight

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The average valuation of venture capital-backed firms globally breached $2 billion as of the end of the third quarter, exceeding pre-pandemic levels.

Financial technology and startups with business models focused on the move to online services benefited the most.

➤ Pressure is now on for strong exits via public markets.

➤ Read more about venture capital post-money valuations here.

FUNDRAISING & DEALS

* GlaxoSmithKline PLC is attracting buyout interest from private equity firms such as Advent International Corp., Blackstone Inc., Carlyle, CVC Capital Partners Ltd., KKR and Permira Advisers Ltd. for its consumer unit, which could be worth £40 billion or more. The British pharmaceutical company is also preparing for an IPO of the business, Bloomberg News reported.

* EQT AB (publ) is divesting Spanish fiber-to-the-home operator Adamo Telecom SL to Ardian Infrastructure for an undisclosed amount in a deal slated to close in the first quarter of 2022. Separately, the $5.3 billion all-cash acquisition of Covanta Holding Corp. by the firm's EQT Infrastructure V fund has been approved by the waste-to-energy facility operator's shareholders.

* Clayton Dubilier & Rice LLC and KKR wrapped up their takeover of enterprise data cloud group Cloudera Inc. for $5.3 billion.

* Bain Capital LP is seeking to partner with French investors in its bid to acquire Engie SA's technical service provider Equans, people familiar with the matter told Bloomberg. Under the proposal, Bain would own a 60% stake in Equans, Engie will hold a 20% stake, and the remainder will be held by the prospective French partners.

ELSEWHERE IN THE INDUSTRY

* Hunter Point Capital LP is seeking to obtain as much as $2.5 billion for its latest fund that will target minority stakes in private equity, credit and real estate-focused firms, Bloomberg reported, citing people with knowledge of the matter.

* An affiliate of Cerberus Capital Management LP formed a direct-to-consumer mattress platform with its acquisitions of Brooklyn Bedding LLC and Helix Sleep Inc.

* Bridgepoint Group PLC could sell Element Materials Technology Ltd. at a potential valuation of about €4 billion, as it reviews alternative options for the British testing company, people familiar with the matter told Bloomberg.

* Wellspring Capital Management Group LLC bought compounded sterile medications provider Pentec Health Inc.

FOCUS ON: MUSIC

* Blackstone is aiming to deploy $1 billion into the acquisition of music rights and management of catalogs through a partnership with an advisory firm affiliated with music investment company Hipgnosis Songs Fund Ltd.

* A consortium led by KKR and former The Goldman Sachs Group Inc. partner Stephen Hendel's family office are in advanced discussions to acquire a majority interest in indie music company Kobalt's song catalog, which also received interest from an Apollo-led investor group and Eldridge Industries LLC, London's Financial Times reported, citing people familiar with the talks.

* Spirit Music Group Inc.'s portfolio, comprising mature music royalty assets managed by music rights investor Lyric Capital Management Group LP, secured a $500 million strategic investment led by Northleaf Capital Partners Ltd.-managed funds.