Investcorp

Overview

Investcorp is a global investment manager specializing in alternative investments, founded in 1982 by Nemir A. Kirdar. The firm has grown from its roots in the Gulf to become a major player in the global investment landscape.

Business Lines

Investcorp operates across several key business lines:

• Private Equity: Focuses on mid-market investments, particularly in North America, targeting services-oriented companies with strong growth potential.
• Real Estate: Invests in global real estate opportunities.
• Absolute Return Strategies: Offers investors exposure to a broader array of investment opportunities.
• Credit Management: Launched in 2017 as part of its global growth strategy.
• Infrastructure: Entered through a joint venture with Aberdeen Standard Investments.
• Strategic Capital: Invests in mid-sized alternative investment managers.

Growth and Global Presence

Investcorp has experienced significant growth, with Assets Under Management (AUM) increasing from $10 billion to over $50 billion in the past six years, reaching $53 billion as of June 30, 2024. The firm has expanded its global presence with offices in key locations such as New York City, London, Riyadh, Abu Dhabi, Doha, Singapore, and Mumbai.

Investment Approach

Investcorp is known for its disciplined investment approach, acting as a strategic partner to its portfolio companies. The firm focuses on organic growth, mergers and acquisitions, enhancing team and organization, and improving efficiency and infrastructure.

ESG and Corporate Responsibility

Investcorp places a strong emphasis on Environmental, Social, and Governance (ESG) factors, integrating ESG considerations into its due diligence processes and ongoing investment support.

Leadership

As of the latest information, Mohammed Alardhi serves as the Executive Chairman, leading the firm's global growth strategy and overseeing its continued expansion and commitment to sustainable value creation. Investcorp has established itself as a trusted global alternative asset manager, known for its superior performance, diverse asset classes, and commitment to ESG and corporate responsibility.

Leadership Team

Investcorp's leadership structure has undergone significant changes to support its growth strategy and enhance performance across various asset classes and geographies.

Executive Leadership

• Mohammed Alardhi: Executive Chairman, assumed additional responsibilities previously undertaken by the Co-CEOs, effective September 1, 2024.
• Rishi Kapoor: Appointed as Vice Chairman and Chief Investment Officer (CIO), focusing on delivering optimal performance for clients and shareholders.

Global Business Verticals

Investcorp has consolidated its investment activities under three global business verticals:

1. Private Equity and Private Equity-like: Led by Dave Tayeh
2. Real Assets (Real Estate and Infrastructure): Co-led by Herb Myers and Mike O'Brien
3. Credit: Undergoing leadership transition (see below)
4. Global Distribution Platform: Led by Yusef Al-Yusef

Credit Management Leadership Transition

• Jeremy Ghose: Stepping down as global head of Credit Management to become non-executive Chairman, effective April 1, 2025, retiring on July 31, 2025.
• Tom Shandell: Outgoing head of US CLO and Broadly Syndicated Loans, continuing support until retirement on June 30, 2025.
• Neil Rickard and Corey Geis: Becoming Co-Heads of liquid credit investment strategies, effective April 1, 2025. Neil will be responsible for the European business, while Corey will oversee the US business.

Other Key Roles

• Suhail A. Shaikh: President and CEO of Investcorp Credit Management, BDC Inc., and Chief Investment Officer of CM Investment Partners, LLC.
• Michael C. Mauer: Chairman of the Board of Investcorp Credit Management, BDC Inc. and Vice Chairman of Private Credit at Investcorp. These leadership changes reflect Investcorp's strategy to enhance its structure, leverage its investment platform, and support future growth plans across various asset classes and geographies.

History

Investcorp, founded in 1982, has evolved from a regional investment intermediary to a global alternative asset manager. Here are the key milestones in the company's history:

Founding and Early Years (1982-1990)

• 1982: Founded in Bahrain by Nemir Kirdar and colleagues to bridge Gulf wealth with US and European investment opportunities.
• 1984: Acquired 10% interest in A&W Brands Inc., ManuLife Plaza in Los Angeles, and Tiffany & Co.
• 1987: Acquired 47.8% of Gucci (remaining 50% acquired in 1993).
• 1988: Expanded operations with offices in New York and London.
• 1990: Acquired Saks Fifth Avenue.

Expansion and Diversification (1990-2000)

• 1993: Acquired Circle convenience store chain.
• 1996: Launched dedicated Real Estate and Absolute Return Investment businesses.
• Late 1990s: Hedge fund business grew to manage approximately $3.5 billion in capital.
• 2000: Established Technology Ventures business unit focusing on later-stage startups.

Global Growth and New Initiatives (2000-Present)

• 2015: Set new global growth strategy under new Executive Chairman Mohammed Alardhi.
• 2017: Achieved target of doubling AUM, launched Credit Management Business, and opened Singapore office.
• 2019: Acquired Mercury Capital in the US.
• 2020: Merged hedge fund business with Tages Group in a 50/50 joint venture.
• 2023: Managing over $50 billion in assets across seven asset classes.

Key Acquisitions and Investments

• Real estate division has acquired over 1,000 properties valued at approximately $23 billion since 1996.
• Expanded presence in China and other regions.

Leadership and Ownership

• 2015: Nemir Kirdar stepped down; Mohammed Alardhi became Executive Chairman.
• Current: Mubadala Investment Company is the largest external shareholder with a 20% stake. Investcorp's history reflects its transformation into a diverse, global alternative asset manager with a strong presence across multiple investment sectors and geographies.

Products & Solutions

Investcorp, a global manager of alternative investment products, offers a diverse range of asset classes and solutions tailored to meet the needs of private and institutional clients:

Private Equity

Investcorp's private equity operations cover mid-size companies in North America, Western Europe, the MENA region, and Asia. Their specialized team, Investcorp Technology Partners (ITP), focuses on European-headquartered technology companies with proven products and B2B end markets. Typical investments target companies with revenues of $10 million or more and positive EBITDA, with equity investments ranging from $20-100 million.

Real Estate

Active since 1996, Investcorp's real estate division, based in New York and London, sources, performs due diligence, arranges financing, and acquires properties in the US and Europe. They also invest in US commercial mortgage debt positions. To date, they have acquired over 1,300 properties valued at approximately $25 billion.

Credit Management

Investcorp Credit Management, operating in London, New York, and Singapore, manages funds investing primarily in senior secured corporate debt issued by mid and large-cap corporates in Western Europe and the US. The credit management team oversees assets under management of over $23.3 billion.

Absolute Return Investments

Investcorp has a 50/50 joint venture with Tages Capital, known as Investcorp-Tages Limited, managing more than $7 billion in revenue-generating assets. This platform is known for continuous product innovation and alignment with investors' interests.

Infrastructure

A joint venture with Aberdeen Standard Investments focuses on infrastructure investments in the GCC region, leveraging Investcorp's extensive private equity expertise and market reach.

Strategic Capital

The Strategic Capital Group acquires minority interests in alternative asset managers with strong track records, exceptional teams, and attractive growth prospects, expanding Investcorp's suite of offerings and enhancing its capabilities.

Insurance Solutions

Launched in October 2021, Investcorp Insurance Solutions provides investment management services tailored to insurers' unique needs, helping them allocate to private investments as a source of alpha.

Other Asset Classes

Investcorp also manages assets in GP stakes and has investments in areas such as technology, food, and logistics, as seen in portfolio companies like FreshToHome and XpressBees. Investcorp's diversified portfolio and global reach position it as a significant player in the alternative investment management sector.

Core Technology

Investcorp's core technology investment strategy, particularly through its Investcorp Technology Partners (ITP), focuses on several key areas:

Investment Focus

ITP targets growing B2B technology companies with proven products and end markets, operating in sectors such as software, data/analytics, cybersecurity, and fintech.

Investment Criteria

Investcorp seeks companies with:

• Revenues of around $10 million or more
• Positive EBITDA
• Equity investment requirements between $30-75 million (can range from $20-100 million in some cases)

Geographic Reach

ITP invests globally, with a particular emphasis on European-headquartered businesses, but also includes investments in North America, Asia, and the GCC.

Post-Acquisition Support

After investment, Investcorp provides value-added management and oversight support, combining financial, operational, and strategic expertise. This includes partnering with founders and management teams to drive accelerated growth through add-on acquisitions, global expansion, and operational improvements.

Recent Funds

The latest fund, Investcorp Technology Partners V (ITP V), closed at $570 million, exceeding its $500 million target. It has already invested in companies such as VEDA (HR software, Germany), HWG Sababa (cybersecurity, Italy), Zift Solutions (PRM software, USA), and NetRom (software engineering, the Netherlands).

Long-Term Strategy

Investcorp maintains a disciplined approach to entry valuations and focuses on a small subset of sectors with long-term tailwinds. This strategy has enabled the firm to consistently achieve attractive returns for its investors over the past 20 years.

Industry Peers

Investcorp, a global alternative investment firm, operates alongside several notable peers and competitors in the private equity and alternative investment space:

Private Equity Firms

• Bain Capital: A global private investment firm
• The Carlyle Group: A global investment firm managing funds across various asset classes
• BlackRock: While primarily known for asset management, it also has significant private equity operations
• Fortress Investment Group: A global investment management firm specializing in private equity and other asset classes
• H.I.G. Capital: A private equity and alternative assets investment firm
• Thoma Bravo: A private equity firm focused on software and technology-enabled services
• Cerberus Capital Management: A global private equity firm

Investment and Management Firms

• Lone Star Funds: A private equity firm investing in real estate, equity, and credit
• Cumulus Companies: An investment and management firm
• Pantheon International: An investment trust investing in private equity funds globally

Other Alternatives

• Advent International: A global private equity firm
• HMC Capital: An investment firm operating in various asset classes These companies compete with Investcorp in various sectors, including private equity, real assets, credit, and liquid strategies. Each firm has its unique strengths and investment focus, contributing to a diverse and competitive landscape in the alternative investment industry.