Clearlake Capital

Clearlake Capital Group, L.P. is a private equity firm founded in 2006 that focuses on the technology, industrial and consumer sectors.[2][3][4][5] The firm is headquartered in Santa Monica with affiliates in Dallas, London and Dublin.[1][3][4][5] In 2022, the firm was a part of an investor consortium named BlueCo that purchased Chelsea F.C.[3][5][6][7]

Clearlake Capital Group, L.P.
TypePrivate
IndustryPrivate Equity
Founded2006 (2006)
Founders
  • Steven Chang
  • Behdad Eghbali
  • José Feliciano
Headquarters233 Wilshire Blvd, Santa Monica, California U.S.
AUMUS$72 billion (2022)
Number of employees
77 (2022)
SubsidiariesWhiteStar Asset Management
Websiteclearlake.com
Footnotes / references
[1][2][3][4]

In June 2023, Clearlake Capital was ranked 14th in Private Equity International's PEI 300 ranking of the largest private equity firms in the world.[8]

Background

Clearlake Capital was founded in 2006 by Steven Chang, Behdad Eghbali and José Feliciano.[2][3][4][5] The strategy was to shift between buyouts and distressed securities depending on economic conditions.[3] This allowed the firm to take advantage of the 2007–2008 financial crisis to acquire distressed securities and then sell them for a profit after recovery.[3]

In 2015, Chang left the firm leaving Eghbali and Feliciano as the remaining managing partners.[2][9]

In May 2018, Clearlake sold a minority stake of up to 20% of its shares to Dyal Capital, Petershill Partners and Landmark Partners.[10][11] The purpose of the sale was to fund the creation of a credit unit.[11]

In June 2020, Clearlake acquired a majority interest in WhiteStar Asset Management from Pine Brook Road Partners.[3][12] WhiteStar Asset Management serves as the credit platform of Clearlake.[3][12]

In recent years Clearlake has become the biggest user of “GP-led secondaries”.[3] It is a technique where Clearlake will find another private equity firm to buy a large portion of one of its existing investments and then offer investors a chance to sell at a new valuation or roll their stake into a new fund that will hold the investment for a few more years.[3] It discovered this technique during the COVID-19 pandemic when it sold shares of software company Ivanti to TA Associates in August 2020 at a valuation of $2 billion that generated a large windfall gain.[3] Many investors chose to roll their holdings instead.[3] In 2021, Charlesbank Capital Partners invested in Ivanti at a valuation of $4 billion.[3]

Funds
Fund[13] Vintage Year Committed Capital (US$m)
Clearlake Capital Partners I N/A N/A
Clearlake Capital Partners II 2010 410
Clearlake Capital Partners III 2013 785
Clearlake Capital Partners IV 2015 1,380
Clearlake Opportunities Partners 2016 600
Clearlake Capital Partners V 2018 3,600
Clearlake Opportunities Partners II 2019 1,400
Clearlake Capital Partners VI 2020 7,000
Clearlake Opportunities Partners III[14] 2022 2,500
Clearlake Capital Partners VII[15] 2022 14,000

Notable deals

In 2014, Clearlake acquired the women's clothing company Ashley Stewart for $18 million after it had recently filed for bankruptcy.[9] After the company underwent significant restructuring including cost-cutting, Clearlake sold the company to Invus Group for more than $140 million in 2016.[9]

In 2015, Clearlake took a controlling stake in Syncsort.[16] In 2016 Clearlake, took a controlling stake in Vision Solutions.[16] In 2017, Clearlake sold both companies to Centerbridge Partners for $1.26 billion and were merged.[16][17] In 2020 the merged company rebranded to Precisely. In 2021, Clearlake and TA Associates reacquired Precisely for $3.5 billion.[16][17]

In October 2021, the firm acquired Cornerstone OnDemand a NASDAQ listed software company for $5.2 billion and took the company private.[18][19]

On May 30, 2022, an investor consortium named BlueCo co-led by Clearlake and Todd Boehly acquired Chelsea F.C. for $3 billion.[3][5][6][7] Clearlake, which owns about 60% of Chelsea, would share joint control and equal governance of the club with Boehly.[5]

References
  1. "Form ADV" (PDF). SEC.
  2. "Clearlake Capital hits fundraising trail minus a founder | Buyouts". 26 October 2021. Archived from the original on 2021-10-26.
  3. "Clearlake, the US buyout group behind the Chelsea bid". Financial Times. 7 May 2022.
  4. Singh, Preeti (18 May 2022). "Clearlake Capital Wraps Up Latest Fund With $14.1 Billion". Wall Street Journal.
  5. Dowd, Kevin. "Clearlake Follows Its Chelsea Deal With A $14.1 Billion Buyout Fund". Forbes. Retrieved 2023-02-24.
  6. "Wall Street Brings Its Financial Engineering to English Football". Bloomberg.com. 2023-02-17. Retrieved 2023-02-24.
  7. "Consortium led by Todd Boehly and Clearlake Capital completes acquisition of Chelsea Football Club". www.chelseafc.com. Retrieved 2023-02-24.
  8. "PEI 300 | The Largest Private Equity Firms in the World". Private Equity International. 2023-06-01. Retrieved 2023-06-02.
  9. "The Fall and Rise of a Plus-Size Empire". Bloomberg.com. 2017-12-21. Retrieved 2023-02-24.
  10. "Clearlake Capital sells 20% stake to 3 alternatives fund managers". Pensions & Investments. 2018-05-25. Retrieved 2023-02-24.
  11. "Clearlake Attracts Minority Investment From Dyal, Goldman, Landmark". Institutional Investor. Retrieved 2023-02-24.
  12. "Clearlake Capital purchases majority stake in WhiteStar Asset Management". www.spglobal.com. Retrieved 2023-02-24.
  13. "Clearlake Capital Group | Palico". www.palico.com. Retrieved 2023-02-25.
  14. Larin, Marvin (2022-09-20). "Clearlake Capital closes Clearlake Opportunities Partners III with more than $2.5 billion in commitments". Clearlake Capital. Retrieved 2023-02-25.
  15. Larin, Marvin (2022-05-18). "Clearlake Capital closes seventh flagship private equity fund with more than $14.1 billion in commitments". Clearlake Capital. Retrieved 2023-02-25.
  16. Woodie, Alex (2021-03-08). "Clearlake Re-Acquires Precisely In $3.5 Billion Deal". IT Jungle. Retrieved 2023-02-24.
  17. "Two private equity firms take control of U.S. software company Precisely in $3.5 billion deal: source". Reuters. 2021-03-03. Retrieved 2023-02-24.
  18. "Clearlake Capital to take Cornerstone OnDemand private for $3.8 billion". Reuters. 2021-08-05. Retrieved 2023-02-24.
  19. "In $5.2B deal, Cornerstone OnDemand goes private | TechTarget". HR Software. Retrieved 2023-02-24.
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