Blue Wolf Capital Partners Donates $27,000 to Monette, Arkansas Storm Shelters
June 08, 2023 – MONETTE, Ark. – Blue Wolf Capital Partners, LLC (“Blue Wolf”) announced today its commitment to support the community of Monette, Arkansas, with a donation of $27,000 to the City of Monette Community Relief Fund. On Friday, December 10, 2021, Monette was struck by a devastating EF4 tornado. The community created the fund to help with immediate support and improved community safety.
The donation from Blue Wolf will be used to support the installation and maintenance of storm shelters in the area, helping to keep the community safe in the event of future natural disasters. This funding comes at a critical time, as Monette and the surrounding areas continue to recover from the storm’s impact.
“Blue Wolf is honored to support the people of Monette in their ongoing efforts to rebuild and recover from the tornado,” said Jeremy Kogler, managing partner at Blue Wolf. “We believe in giving back to the communities where we live and work, and we are proud to support the City of Monette Community Relief Fund in their efforts to provide vital resources to those in need.”
The City of Monette Community Relief Fund has been instrumental in providing support and resources to local residents and businesses affected by the storm, and Blue Wolf’s donation will help to ensure that the community has the resources it needs to protect its citizens if another storm comes.
“I would like to extend our most sincere and heartfelt gratitude to Blue Wolf Capital Partners for their generous donation of $27,000 to assist with the costs of installing new storm shelters within our city limits. Our hometown and our citizens were changed forever on December 10, 2021,” said the city of Monette Mayor Bob Blankenship. “Homes and businesses were destroyed, and lives were lost. Recovery has been a long and difficult road for us all. We have been immensely blessed with many helpers along the way. This monetary donation from Blue Wolf Capital Partners will ensure that all of our residents will have a nearby safe place to go in the event of another destructive storm. We thank you for your generosity and continued commitment to our hometown.”
Blue Wolf acquired Colson Group in February 2021, including its manufacturing facility in Jonesboro, Arkansas. In 2022, Colson built a new, 135,000 square foot facility on a 25-acre site located in Northeast Arkansas’s newest industrial park. Colson has 170 employees at its Jonesboro and Monette locations. Blue Wolf’s investments in Arkansas also include Caddo River Forests Products, Twin Rivers Paper Company, Conifex, and Carthage Forest Products.
About Blue Wolf Capital Partners
Blue Wolf is a private equity firm that focuses on value investments in middle market companies in the healthcare and industrial sectors. The firm’s integrated team of investment professionals and veteran operating executives work collaboratively to generate returns by driving transformational change using operational and strategic experience. Blue Wolf seeks to invest in businesses that have catalysts for value creation that involve organizational transformation, complex union or human capital issues, significant government or regulatory presence, financial or operational distress or the opportunity to use ESG-informed strategies.
Blue Wolf Capital Acquires Sterling Site Access Solutions
February 08, 2023 – NEW YORK – Blue Wolf Capital Partners (“Blue Wolf”), a New York-based private equity firm, announced today that it has acquired Sterling Site Access Solutions (“Sterling” or the “Company”), a leading, vertically-integrated provider of temporary ground protection and site access services.
Founded in 1949, Sterling is one of the largest providers of mission critical site access solutions in North America. The Company offers a comprehensive suite of products and services including site planning and design, mat rentals and sales, site preparation, mat installation, and final mat removal and site restoration. Sterling operates through two manufacturing facilities in Phoenix, Illinois and Lufkin, Texas, as well as distribution yards across the U.S. Midwest, South and Northeast. The Company serves blue-chip customers in the power transmission and distribution, civil infrastructure, and energy sectors.
“As a leader in the growing market for site access solutions, Sterling has earned a reputation for quality and reliability,” said Aakash Patel, Partner at Blue Wolf Capital. “With its turnkey products and services and industry-leading production capacity, the Company is uniquely positioned to support critical infrastructure projects across North America. We are very excited to partner with Sterling to expand upon the Company’s capabilities and accelerate growth over the next several years.”
“We are pleased to be partnering with Blue Wolf to build on Sterling’s long history of innovative solutions and outstanding customer service,” said Carter Sterling, CEO of Sterling. “Since my family started this business more than 70 years ago, we have grown into an industry leader that provides safe, efficient, environmentally friendly jobsite solutions to our customers. As we enter this next phase of our journey, Sterling will benefit from Blue Wolf’s deep bench of investment and operating professionals and significant industry experience.”
“Sterling is a great fit for Blue Wolf’s portfolio,” said James Shovlin, Principal at Blue Wolf Capital. “Through our industrial sector expertise, we have a deep understanding of Sterling’s supply chain and end markets. We see a significant opportunity to collaborate with Carter and the Sterling leadership team to drive value creation through commercial and operational enhancements.”
Terms of the transaction were not disclosed.
About Sterling Site Access Solutions
Sterling is a leading North American site access contractor providing ground protection products and turnkey access solutions, including site planning & design, mat rentals & sales, site preparation, mat installation, and final mat removal & site restoration. Sterling serves a blue-chip customer base, including asset owners and general contractors in the power transmission & distribution, civil infrastructure, and energy end markets, helping them protect the environment and ensure workers’ safety on their jobsites. Sterling is committed to engineering innovative new products and services for the North American ground protection industry. For additional information, please visit Sterling’s website at https://www.sterlingsolutions.com/.
About Blue Wolf Capital
Blue Wolf Capital is a private equity firm that invests in buyouts, recapitalizations, and growth capital opportunities in middle market companies. The firm focuses on making control investments and works collaboratively to generate returns through operational and strategic experience. Blue Wolf manages challenging situations and complex relationships between business, customers, employees, unions, and regulators with the goal of building value for stakeholders. For additional information, please visit www.bluewolfcapital.com.
January 03, 2023 – NEW YORK – Blue Wolf Capital Partners LLC (“Blue Wolf”), a New York-based private equity firm, today named Natalie Marjancik as a Partner of the firm, announced the promotions of James Shovlin to Principal and David Meyers and Jordan Fong to Senior Associate and expanded Kate Spaziani’s role to Director of Government Affairs and Communications.
“We are delighted to welcome Natalie as our newest Partner and to recognize the significant value she brings to the firm and its portfolio companies,” said Jeremy Kogler, Managing Partner at Blue Wolf. “We also are pleased to extend well-deserved promotions and role expansions to four team members, James, Kate, David and Jordan. Over the past year, thanks to our team’s collective experience, market knowledge and core competencies, Blue Wolf has successfully navigated a challenging global environment. We are proud of our performance and look forward to continued success.”
“I am honored to take on this expanded role and join Blue Wolf’s talented, long-standing group of partners,” said Ms. Marjancik. “Since first becoming acquainted with Blue Wolf nearly a decade ago, I’ve been impressed by the depth and investment discipline of the team, and I look forward to continue building on the firm’s proven track record of investment and operational excellence.”
Ms. Marjancik joined Blue Wolf in March 2022 as Managing Director, Capital Markets, bringing significant expertise in complex, multi-dimensional financing strategies. Prior to joining Blue Wolf, Ms. Marjancik spent almost 13 years at Lincoln International focusing on capital and debt advisory. During her time there, Ms. Marjancik served as a key advisor to corporate and private equity clients, including Blue Wolf, on the structuring and arranging of debt financings across multiple sectors, including, among others, industrials, consumer, business services and healthcare. She also assessed and rendered opinions on companies’ debt capacities and various corporate transactional matters, including financing terms and structures available to borrowers. Prior to that, Ms. Marjancik practiced corporate law at Shearman & Sterling LLP, where she advised on domestic and cross-border capital raising transactions, mergers, acquisitions, divestitures and joint ventures.
Ms. Marjancik received a B.S. with honors from Purdue University, a M.B.A. with honors from the Booth School of Business at the University of Chicago and a J.D., magna cum laude, from Boston University School of Law.
Mr. Shovlin joined Blue Wolf in 2015 and most recently served as Vice President. Currently, he serves on the Board of Directors of Blue Wolf portfolio companies C&C Forest Products, The State Group, Vicksburg Forest Products, and Welch & Rushe. Prior to joining the firm, Mr. Shovlin was an Analyst in the Restructuring group at Guggenheim Securities. He received a B.S. in Economics with concentrations in Accounting and Finance from the Wharton School at the University of Pennsylvania.
Ms. Spaziani joined Blue Wolf in 2021 as Director of Government Affairs. Prior to joining the firm, she spent more than seven years at the NewYork-Presbyterian hospital system, serving as Vice President of Communications, External Affairs, and Federal Relations, and worked in both the US House and Senate as a senior staff member. Ms. Spaziani received a B.A., magna cum laude, from Duke University and a J.D., cum laude, from Georgetown University Law Center.
Mr. Meyers joined Blue Wolf in 2020 and most recently served as an Associate. Previously he was an Analyst in the Restructuring group at Perella Weinberg Partners. Mr. Meyers received a Bachelor of Commerce with First Class Honors in Investment Management from McGill University.
Mr. Fong joined Blue Wolf in 2021 and most recently served as an Associate. Prior to joining the firm, he was an Analyst in the Industrials Mergers & Acquisitions investment banking group at Rothschild & Co. Mr. Fong received a B.A. in Economics from Hamilton College.
About Blue Wolf Capital Partners
Blue Wolf Capital is a private equity firm that invests in buyouts, recapitalizations, and growth capital opportunities in middle market companies. The firm focuses on making control investments and works collaboratively to generate returns through operational and strategic experience. Blue Wolf manages challenging situations and complex relationships between business, customers, employees, unions, and regulators with the goal of building value for stakeholders. For additional information, please visit www.bluewolfcapital.com.
Blue Wolf Capital Names Eve Mongiardo Chief Financial Officer
September 7, 2022 – NEW YORK – Blue Wolf Capital Partners LLC (“Blue Wolf”), a New York-based private equity firm, today announced that Eve Gerriets Mongiardo will be joining the firm’s senior leadership team as Chief Financial Officer (“CFO”) and Chief Compliance Officer, overseeing financial reporting, investor relations and compliance. Ms. Mongiardo, a financial and audit committee expert with over 30 years of private equity experience, most recently served as Blue Wolf’s Interim CFO.
“With the closing of Fund V, Blue Wolf continues to build a team with unparalleled talent and expertise, demonstrating our capacity to effectively manage the portfolio and deliver outstanding outcomes,” said Adam Blumenthal, Chairman and Managing Partner at Blue Wolf. “Eve will be a tremendous asset to Blue Wolf given her deep financial and operational experience, and I am thrilled to welcome her to our leadership team.”
“Eve is a seasoned executive in financial management with extensive experience in complex business environments,” said Jeremy Kogler, Managing Partner at Blue Wolf. “Since joining the firm earlier this year, Eve already has made considerable contributions to our organization, and I am delighted she will be officially joining Blue Wolf as we manage a growing investment portfolio.”
“I am so pleased to join Blue Wolf where the strategy, culture and differentiated investment approach have resulted in a strong growth trajectory and investment portfolio,” said Ms. Mongiardo. “I look forward to leveraging my experience and contributing to the future growth of the firm.”
Ms. Mongiardo is a senior executive with decades of experience leading successful initiatives and optimizing financial management processes. Prior to joining Blue Wolf, she provided consulting and advisory services, including CFO advisory services, best practice, operational excellence review and capital raising initiatives. Ms. Mongiardo spent 12 years with Irving Place Capital, where she was a Partner. Previously she held a senior role at Soros Private Funds Management and also worked for Goldman Sachs. She started her career at Deloitte, where she spent four years in the auditing practice.
Ms. Mongiardo is a Certified Public Accountant and received a B.S. from Lehigh University and a M.B.A. from New York University Stern School of Business.
About Blue Wolf Capital Partners
Blue Wolf Capital Partners LLC is a private equity firm that specializes in control investments in middle market companies. Leading by experience, and with a commitment to excellence, Blue Wolf transforms companies strategically, operationally and collaboratively. Blue Wolf manages challenging situations and complex relationships between business, customers, employees, unions, and regulators to build value for stakeholders. For additional information, please visit www.bluewolfcapital.com.
GCM Grosvenor and Blue Wolf Capital Acquire Hallcon Corporation
Acquisition will accelerate the growth of Hallcon’s footprint through expansion into new North American markets and investment in electric vehicle charging infrastructure
July 5, 2022 – CHICAGO – GCM Grosvenor (Nasdaq: GCMG), a leading global alternative asset management solutions provider, investing through its Labor Impact Strategy, and Blue Wolf Capital Partners LLC (“Blue Wolf”), a New York-based private equity firm with approximately $2.9 billion of assets under management, announced today that they have acquired Hallcon Corporation (“Hallcon” or the “Company”) from Novacap, a Canadian private equity firm. Terms of the transaction were not disclosed.
Hallcon is the leading North American provider of mission-critical transportation services and infrastructure for a broad range of customers including railroads, universities, airports, hospitals and healthcare systems, public transit, technology and industrial companies, and other large employers seeking custom transportation solutions. In addition, the Company provides essential cleaning, disinfecting, and facilities maintenance services to municipal, regional, and national rail and transit providers throughout the United States and Canada. Headquartered in Chicago, Hallcon has a coast-to-coast North American footprint, with direct operations across 29 U.S. states and six Canadian provinces. With Blue Wolf and GCM Grosvenor’s backing, the Company will be able to accelerate Hallcon’s expansion into new North American markets including Seattle, WA, Austin, TX, Atlanta, GA, Washington, D.C. and more. The firms also intend to enhance the Company’s ability to scale its electric vehicle (“EV”) charging infrastructure to continue supporting the evolving needs of its customers that are transitioning to electric fleets.
John R. Stoiber, President and CEO of Hallcon, said, “We are very excited to partner with GCM Grosvenor and Blue Wolf as we accelerate the growth of our services in new geographies and expand our EV charging network across North America. Their commitment to supporting the construction of critical EV infrastructure makes them the right partners for Hallcon, and we look forward to leveraging their relationships, resources, and expertise as we execute on our growth strategy.”
“Blue Wolf is pleased to partner with Hallcon, a leading platform in the outsourced transportation space. The Company has significant opportunity ahead to enhance its leadership position and drive growth as customers electrify their fleets,” said Jeremy Kogler, Managing Partner at Blue Wolf. “Hallcon has a reputation for best-in-class service and reliability, which is evidenced by the Company’s long-standing relationships with its blue-chip customer base. We look forward to joining the Company and GCM Grosvenor in the next phase of growth.”
“Hallcon is led by a management team of experienced operators who are well-equipped to help customers navigate the shift to electric vehicles, and our investment partner Blue Wolf shares our vision for value creation and growth,” added James DiMola, Executive Director at GCM Grosvenor. “In addition, the Company’s highly skilled workforce of drivers and dispatchers are integral to Hallcon’s success, and they do tremendous work to ensure that its customers are safe and satisfied.”
TD Securities served as financial advisor and Greenberg Traurig, LLP served as legal advisor to GCM Grosvenor and Blue Wolf in connection with the transaction. Houlihan Lokey served as financial advisor and Blake, Cassels & Graydon LLP served as legal advisor to Hallcon.
About GCM Grosvenor
GCM Grosvenor (Nasdaq: GCMG) is a global alternative asset management solutions provider with approximately $71 billion in assets under management across private equity, infrastructure, real estate, credit, and absolute return investment strategies. The firm has specialized in alternatives for more than 50 years and is dedicated to delivering value for clients by leveraging its cross-asset class and flexible investment platform. GCM Grosvenor’s experienced team of over 520 professionals serves a global client base of institutional and high net worth investors. The firm is headquartered in Chicago, with offices in New York, Toronto, London, Frankfurt, Tokyo, Hong Kong, and Seoul. For more information, visit: gcmgrosvenor.com.
GCM Grosvenor’s Labor Impact Strategy seeks to originate and execute infrastructure projects that leverage the inclusion of union labor as a contributing factor to enabling attractive risk-adjusted returns. The goal of the strategy is to find attractive infrastructure investment opportunities that can be unlocked through close cooperation across labor, government, and private capital.
About Blue Wolf Capital Partners
Blue Wolf Capital Partners LLC is a private equity firm that specializes in control investments in middle market companies. Leading by experience, and with a commitment to excellence, Blue Wolf transforms companies strategically, operationally, and collaboratively. Blue Wolf manages challenging situations and complex relationships between business, customers, employees, unions, and regulators to build value for stakeholders. For additional information, please visit www.bluewolfcapital.com.
About Hallcon Corporation
Headquartered in Chicago, Illinois with offices in San Jose, California, Lenexa, Kansas, and Toronto, Ontario, Hallcon is the leading North American provider of mission-critical transportation services and infrastructure for a broad range of customers including railroads, universities, airports, hospitals and healthcare systems, public transit, technology and industrial companies, and other large employers seeking custom transportation solutions. In addition, the Company provides essential cleaning, disinfecting, and facilities maintenance services to municipal, regional, and national rail and transit providers throughout the United States and Canada. The Company has a coast-to-coast North American footprint, with direct operations across 29 U.S. states and six Canadian provinces. For additional information, please visit www.hallcon.com.
Blue Wolf Commits to Institute Employee Ownership Programs in Partnership with Ownership Works
Colson Group, A Blue Wolf Portfolio Company, Announces New Equity Participation Program
April 5, 2022 – NEW YORK – Blue Wolf has partnered with Ownership Works, a new nonprofit with a mission to increase prosperity through shared ownership at work, which launched today with the support of more than 60 partners across the private, public and nonprofit sectors. Ownership Works will develop and help implement broad-based employee ownership programs to create better work environments and financial opportunities for employees with a goal to generate at least $20 billion of wealth for working families by 2030. At the same time, Ownership Works will also help businesses improve their performance by attracting and retaining engaged employees who are invested in their company’s success. Read more about Ownership Works and Blue Wolf’s involvement as a founding partner here.
Through this partnership, Blue Wolf has made a commitment to institute employee ownership programs in at least three of our portfolio companies by the end of 2023. In alignment with that commitment, Colson Group, a Blue Wolf portfolio company, has unveiled a new equity participation program which grants employees shares in the company. Read more about Colson’s new program here.
Blue Wolf Capital Successfully Closes Fund V at $1.1 Billion
Oversubscribed Fund at Hard Cap Doubles Prior Fund
Fund to Continue Investment Strategy in Middle Market Companies Across Key Verticals
April 4, 2022 – NEW YORK – Blue Wolf Capital Partners LLC (“Blue Wolf”), a New York-based private equity firm, today announced it has successfully closed Blue Wolf Capital Fund V (the “Fund”) at its hard cap. The Fund was oversubscribed with strong support from existing investors along with a diverse base of new partners, including pension funds, endowments, foundations, fund-of-funds, family offices and consultants.
The Fund will continue Blue Wolf’s investment strategy by targeting investments in middle market companies across its healthcare and industrial sectors. Through the Fund, Blue Wolf will continue to build upon its proprietary investment approach, which combines financial and operational discipline with Environmental, Social and Governance (ESG) principles. Blue Wolf has deployed this strategy across its previous funds and with this capital raise, now manages approximately $2.9 billion in assets.
“We are proud to have closed Fund V with participation from both existing and new investors, enabling us to continue to deploy capital in our core verticals,” said Adam Blumenthal, Founder, Chairman and Managing Partner of Blue Wolf. “This successful fundraise is a testament to the excellent performance our team has delivered over 17 years as we’ve executed on our differentiated and proven investment strategy. We are excited about our future with Fund V, which we are confident will be a prosperous investment program because our team and strategy are well suited to the dynamic times in which we are currently operating.”
Jeremy Kogler, Managing Partner of Blue Wolf, added, “With the significant growth in capital, we have enhanced our team and capabilities to meet the growing demands of our portfolio. We look forward to leveraging our investment team, proven operational expertise and ESG principles to strategically deploy Fund V capital and execute on our pipeline of attractive opportunities, often proprietary ones, available to Blue Wolf due to our investment approach. We are confident in our ability to continue growing our firm with a focus on creating value for our investors.”
During 2021, Blue Wolf added three new platforms to its portfolio, including the first platform for Fund V, exited three long-term investments and increased the size of its integrated team of investors and operators by 35 percent. The firm’s integrated team of investors and operating partners continue to work closely with management teams to transform middle market businesses into market leaders.
Credit Suisse Securities (USA) LLC acted as private placement advisor and placement agent for the Fund, and Kirkland & Ellis served as legal counsel to Blue Wolf.
About Blue Wolf Capital Partners Blue Wolf Capital Partners LLC is a private equity firm that specializes in control investments in middle market companies. Leading by experience, and with a commitment to excellence, Blue Wolf transforms companies strategically, operationally and collaboratively. Blue Wolf manages challenging situations and complex relationships between business, customers, employees, unions, and regulators to build value for stakeholders. For additional information, please visit www.bluewolfcapital.com.
Blue Wolf Capital Names Natalie Marjancik as Managing Director, Capital Markets
March 14, 2022 – NEW YORK – Blue Wolf Capital Partners LLC (“Blue Wolf”), a New York-based private equity firm, today announced that Natalie Marjancik will be joining the firm’s senior leadership and investment team as Managing Director, Capital Markets. Ms. Marjancik most recently served as Managing Director at Lincoln International, a leading global investment banking advisory firm, where she focused on capital and debt advisory.
“We are pleased to officially welcome Natalie, a trusted advisor who has worked with us extensively during her time at Lincoln, to the Blue Wolf team,” said Jeremy Kogler, Managing Partner at Blue Wolf. “Natalie brings deep expertise in advising companies on capital markets activities including debt and equity transaction structures, financing execution, negotiation of terms and the selection of financing providers across the sectors in which we operate. I am confident we’ll benefit from her experience and expertise as we expand on our value creation record.”
“I am excited to join Blue Wolf, a firm I’ve admired for years for its distinct approach of partnering with portfolio company management teams to deliver financial and operational discipline while prioritizing Environmental, Social and Governance principles,” said Ms. Marjancik. “I look forward to working alongside my new colleagues to advance the firm’s efforts of transforming and strengthening businesses through complex, multi-dimensional strategies.”
Prior to joining Blue Wolf, Ms. Marjancik spent almost 13 years at Lincoln International focusing on capital and debt advisory. During her time there, Ms. Marjancik served as a key advisor to corporate and private equity clients on the structuring and arranging of debt finance across multiple sectors, including, among others, industrials, consumer, business services and healthcare. She also assessed and rendered opinions on companies’ debt capacities and various corporate transactional matters, including financing terms and structures available to borrowers. Prior to that, Ms. Marjancik practiced corporate law at Shearman & Sterling LLP, where she advised on domestic and cross-border capital raising transactions, mergers, acquisitions, divestitures and joint ventures.
Ms. Marjancik received a B.S. with honors from Purdue University, a M.B.A. with honors from the Booth School of Business at the University of Chicago and a J.D., magna cum laude, from Boston University School of Law.
About Blue Wolf Capital Partners Blue Wolf Capital Partners LLC is a private equity firm that specializes in control investments in middle market companies. Leading by experience, and with a commitment to excellence, Blue Wolf transforms companies strategically, operationally and collaboratively. Blue Wolf manages challenging situations and complex relationships between business, customers, employees, unions, and regulators to build value for stakeholders. For additional information, please visit www.bluewolfcapital.com.
Using the SDGs as a Guiding Light: PEI Keynote Interview
Aligning investment strategies with the UN’s Sustainable Development Goals provides a compelling route for value creation, says Blue Wolf Capital’s Adam Blumenthal
The UN’s 17 Sustainable Development Goals are often referenced as part of efforts to promote social and economic development in developing countries. New York-headquartered Blue Wolf Capital Partners, however, also sees the goals as valuable in helping to guide its strategy for a portfolio that largely consists of US-based healthcare and industrial companies.
Adam Blumenthal, the firm’s founder and managing partner, tells Private Equity International that by providing a framework for stakeholder value creation, the SDGs complement ESG frameworks that emphasise quantitative reporting of key performance indicators. Blue Wolf, he says, has found that ensuring portfolio companies deliver on the SDGs puts these businesses on a stable long-term footing and helps generate returns for investors.
Question: Why is private equity investing suited to promoting ESG principles and the SDGs?
As a private equity firm, we design the strategy through which our portfolio companies generate value and secure returns for our investors. We take seriously the choices we make in doing that – there is more than one path to value creation. As a private equity GP, you have the ability to make those choices and to control critical aspects of how companies behave.
At Blue Wolf, we think of environ-mental, social and governance considerations as being a crucial part of our strategy for building companies that are going to have long-term sustainable value. Every time we make a decision to focus on ESG, we make a choice to create value for our investors – and I argue this approach has been critical to our ability to generate top-quartile re-turns over our history.
The Sustainable Development Goals represent a global consensus on what kind of companies and societies are going to support long-term sustainable growth. It is important to us that we take into account the SDGs, since these set the parameters for the long-term macro environment within which our businesses operate.
Question: What do LPs expect from you in terms of ESG?
There is a range of investor sentiment. We have LPs that are purely interest-ed in whether we are delivering on our return forecasts. They are less interested in the underpinnings of our strategy. All they know is that it works, and that is fi ne with them when we post the numbers.
Then there are investors for which the SDGs and other global regulatory or ESG frameworks are important. We have a sustained dialogue with investors that look for GPs to align their strategies with the SDGs while generating attractive returns – and some of these investors have become loyal and substantial investors in our funds. One of the great things about the strategy we have embraced is that we can draw a direct link between the achievement of ESG goals and financial performance.
Question: To what extent is a standardised framework helpful to private equity investors looking to manage ESG risk and opportunities?
There is a lot of discussion around frameworks in the ESG world. It is worth bearing in mind that some 2,000 years after the initial development of double-entry bookkeeping, we still have not come up with a standardised financial accounting framework that people accept across the globe. To get to a standardised framework for dis-cussing the ESG aspects of investment will take time.
It is positive that there is so much effort today being put into creating those frameworks. It is helpful that frameworks are emerging that allow for the quantification of easily report-able KPIs, because quantification and standardisation are important for the development of data that can be measured and managed. However, these frameworks are often not easily correlated with value creation.
The SDGs are a type of framework that can link to strategy, outcomes and value creation, considered broadly – that is value creation not just for the company, but for societies and economies as a whole. They provide a framework for stakeholder value creation and having a common language for discussing stakeholder value creation will ultimately be an important part of the maturation of the ESG movement. Of all the frameworks out there, that aspect of what ESG is about is extremely well captured by the SDGs.
Question: Looking forward, how can the private equity industry better align with the SDGs?
The growth of private capital markets and private equity into a significant force in the global economy has been one of the defining economic developments over the course of my career. As the private equity industry has matured, its responsibility to the broader economy has become more evident.
As it continues to mature, we need to focus more on the principles through which the private equity industry contributes to the global economy. For instance, many private equity funds – both at the largest level and in the mid-market – have been pursuing the idea of employee ownership as a way of addressing inequality. Over the course of the nextfive years, I think we are going to see that idea sweep through the private equity toolkit. After all, what is more in keeping with private equity’s reason for being than creating aligned incentives to drive growth throughout the portfolio? That is what the private equity industry is about.
Question: How has Blue Wolf operationalised its approach to ESG integration and alignment with the SDGs?
Like most private equity firms, we are strong believers that you cannot man-age what you do not measure. So, if we are committed to an ESG strategy, we need to capture core metrics, report them consistently over time, and drive them towards a value-creating outcome.
For example, we have established a safety, health and environmental programme that seeks to establish top-quartile safety, health and environ-mental performance and compliance at every portfolio company. We have developed a disciplined, metrics-based approach to measuring our progress, and we tie progress to executive compensation. By doing that on a consistent basis, we have had a great deal of success in moving the portfolio in the right direction.
Aside from capturing metrics, we integrate core ESG themes into the creation of our investment strategies. We have identified seven core ESG themes – every one of which is easily linked to one or more of the SDGs – that are fundamental to our investment strategy, and we look at those thematically as foundational to the value-creation strategy in our portfolio. By linking the metrics-based and thematic approaches to value creation, we think we have created a broad and robust programme.
Question: Blue Wolf is mainly focused on the US market– are the SDGs as relevant in this context as in emerging markets?
There is a growing problem of inequality in industrialised societies. This is broadly recognised as something that needs to be addressed to sustain competitiveness and growth, and I think the SDGs are an excellent framework for discussing those kinds of issues.
About half of our portfolio is health-care-related and one of our principles is to support the healthcare framework Triple Aim – which means achieving better health, at a lower cost, with a higher level of patient satisfaction. An-other principle is to invest in under-served communities, both in rural and urban areas. Both principles are well aligned with the SDG goals of improving health and wellbeing and reducing inequality.
An example of this in practice is Blue Wolf’s investment in Modern-MD, a healthcare company in Brooklyn, New York. We established the company in a joint venture with a local hospital in 2014, after the passage of the Affordable Care Act. Our ESG scan highlighted that the influx of newly insured people would give us the opportunity to address the large unmet demand for primary care in Brooklyn and to create jobs in an underserved community. Fast forward to today, and that company has delivered primary care, plus covid vaccines and testing, to more than 225,000 people during the past year. Naturally, that makes ModernMD a vital part of the community. That is a great example of using ESG principles and the SDGs to have an impact while generating returns for our investors.
Question: Outside of Blue Wolf’s healthcare portfolio, how do you implement your ESG principles?
Our firm began life making industrial investments, so we have a long, proven track record of building companies through this strategy. Some of the in-vestments we made along this route have been in the rural American South, building sawmill companies. We initially invested in a sawmill located in rural Dixie County, Florida, which has one of the highest poverty rates in the state. The sawmill was a vital local employer, but it also had significant environmental contamination issues that had put the company at risk.
We had the opportunity to acquire the company and then put our capacity for brownfield remediation – which we developed in connection with our ESG goals – to work. We became part of a broader community effort to promote economic development and, as a result, became an employer of choice in the region.
That company then doubled profit-ability and became marketable because of the brownfield remediation. We did something similar with a closed saw-mill in Arkansas, which we reopened and revitalised. That generated great returns for our investors, and for those communities in Florida and Arkansas it created jobs and a clean environment for people who may otherwise have had to move away to find employment opportunities.
Private Equity Industry’s First-Ever ESG Data Convergence Project Announces Milestone Commitment of Over 100 LPs and GPs
Global LPs and GPs representing $8.7 trillion USD in AUM and more than 1,400 private companies commit to collaborative ESG reporting system in its inaugural year
NEW YORK, January 28, 2022 – Since its launch in September 2021, the ESG Data Convergence Project, which seeks to standardize ESG metrics and provide a mechanism for comparative reporting for the private market industry, has announced a milestone commitment of over 100 leading general partners (GPs) and limited partners (LPs) from across the globe to its partnership. The collaboration now represents $8.7 trillion USD in AUM and over 1,400 underlying portfolio companies with new involvement from firms including Apollo Global Management,Ares Management,Goldman Sachs Asset Management, Hermes GPE, and Oaktree Capital Management.
The group is working to streamline the industry’s historically fragmented approach to collecting and reporting ESG data, enabling greater transparency and more comparable portfolio information for LPs. With increased portfolio company representation, the partnership will continue to expand its collection of industry representative data which is expected to increase the quality, availability and comparability of ESG data in private markets.
In Spring 2022, the inaugural data from the ESG Data Convergence Project members will be aggregated into an anonymized benchmark by Boston Consulting Group (BCG) for the 2021 calendar year. The initial data covers the following six categories: greenhouse gas emissions, renewable energy, board diversity, work-related injuries, net new hires, and employee engagement.
Intent on creating a long-term mechanism for improving comparative reporting, the group will meet annually to review and assess the prior year’s data, and to build upon and add to the initial metrics. As part of these efforts, the group is also working to expand more broadly in private markets to include asset classes such as private credit.
Private equity industry stakeholders are encouraged to join this partnership of over 100 members to gather better, more informed ESG data, and in turn collectively drive greater progress on critical ESG issues. To learn more about this initiative and how to get involved, click here.
Companies committed to the ESG Data Convergence Project:
Accel-KKR
Adams Street Partners
Advent Partners
AE Industrial Partners
AEA Investors LP
AlpInvest Partners
Ambienta Sgr
American Industrial Partners
AP6
APG
Apollo Global Management
Appian Capital Advisory LLP
Ares Management
Artá Capital SGEIC
Astorg
Audax Private Equity
Avista Capital Partners
Base10 Partners
Birch Hill Equity Partners
Blackstone
Blue Horizon Corporation AG
Blue Wolf Capital Partners
Bregal Investments
Bridgepoint Group Plc
British Columbia Investment Management Corporation (BCI)
California Public Employees’ Retirement System (CalPERS)
Capital Innovations
CapMan
Carlyle
Centerbridge Partners
CenterOak Partners
Cerberus Capital Management
Cinven
CPP Investments
Crestview Partners
CVC
Dai-Ichi Life Insurance Company, Limited
DPE Deutsche Private Equity
EIG
EMK Capital
Employees’ Retirement System of Rhode Island
EQT AB
Everstone Group
FCDE
Fifth Wall
Forgepoint Capital
Frazier Healthcare Partners
Freshstream
Frumtak Ventures
FullCycle Climate Partners
G Squared
GCM Grosvenor
GENUI
Georgian
Gilde Buy Out Partners BV
Goldman Sachs Asset Management
Grain Management LLC
Hermes GPE
Hg
IK Partners
Insight Partners
Investindustrial
Investment Management Corporation of Ontario (IMCO)
Jada
Japan Post Bank
Kinneret Group
KLAR Partners
LGPS Central Limited
LGT Capital Partners
Lindsay Goldberg
Linzor Capital
LongRange Capital
Mayfair Equity Partners
Mizuho Bank
Montagu Private Equity
Moonfare
New York State Common Retirement Fund (NYSCRF)
Nordic Capital
Oaktree Capital Management
Onex
Palladium Equity Partners
Parcom Capital Management
Permira
PGGM
Pollen Street Capital
Portobello Capital
PSP Investments
Quadriga Capital
Rabo Investments
Riverstone Holdings LLC
San Francisco Employees’ Retirement System (SFERS)
SEB Private Equity
Sumitomo Mitsui Trust Bank
Summa Equity
The Pictet Group
The Rohatyn Group
Tikehau Capital
Tishman Speyer Properties
TowerBrook
Unigestion
Universities Superannuation Scheme
Vista Equity Partners
Wellcome Trust
Wellington Management
Contacts Carlyle Brittany Berliner +1 (212) 813-4839 brittany.berliner@carlyle.com
CalPERS Megan White +1 (916) 795-3991 newsroom@calpers.ca.gov
