Marlin Equity joins Luminate Capital in backing StarCompliance in its next phase of growth
ROCKVILLE, Md., Dec. 17, 2020 /CNW/ — StarCompliance (“Star”), a leading provider of employee compliance and regulatory technology solutions to the financial services industry, today announced a majority-control, growth investment from Marlin Equity Partners (“Marlin”). The transaction enables Star to further expand its leadership position within the global compliance market by accelerating product innovation and supporting the company’s ongoing international expansion. Luminate Capital Partners (“Luminate”), the company’s majority shareholder since 2017, will retain a minority stake.
With a client base of over 500,000 users across 83 countries, Star is a market-leading, highly configurable compliance solution trusted by the world’s largest regulated firms, including asset managers, investment banks, hedge funds, private equity firms, insurance companies, professional services firms, and public corporations. The company has a rich history of innovation with its mission-critical Employee Conflicts of Interest platform, complemented by its newest platform, Compliance Control Room – two comprehensive solutions that assist global firms in efficiently and effectively managing critical aspects of the complex compliance ecosystem.
“We are incredibly proud of our tremendous growth and world-class list of clients with whom we collaborate to automate and streamline compliance oversight,” said Jennifer Sun, CEO at Star. “This investment accelerates our vision of serving as the preeminent leader in the employee compliance and conflicts of interest market and better positions us to help our clients navigate evolving regulation and intelligently manage risk across the employee lifecycle – from onboarding to supporting fast-moving day-to-day operations. We look forward to partnering with Marlin and Luminate for our next phase of growth.”
“Regulatory requirements continue to become increasingly complex with escalating penalties for non-compliance. Star is uniquely addressing this global challenge with its industry-leading technology platform,” said Michael Anderson, Managing Director at Marlin. “We are excited to partner with Star and continue to expand the company’s market leadership by building upon its best-in-class product suite through further product investments and strategic acquisitions.”
“StarCompliance has undergone a tremendous transformation since our initial investment, accelerating its growth, bolstering its management team, launching new products, and expanding its global reach. We are thrilled to partner with Marlin and continue to support the company,” said Hollie Haynes, Managing Partner at Luminate. Dave Ulrich, Partner at Luminate added, “Since our initial investment, Star has seen accelerated demand for its software solutions as firms increasingly struggle to maintain compliance and mitigate risk through manual processes. We expect this acceleration to continue and believe Star is uniquely positioned to address key customer requirements.”
The completion of the transaction is subject to applicable regulatory clearances and other customary closing conditions. Financial details of the transaction have not been disclosed. Kirkland & Ellis LLP served as legal advisor to Marlin. Evercore acted as financial advisor to StarCompliance and Luminate Capital, and Kirkland & Ellis LLP served as legal advisor to StarCompliance.
StarCompliance is a leading provider of compliance technology solutions. Trusted globally by enterprise financial firms in over 83 countries—including asset managers, investment banks, broker dealers, PE firms, insurance companies, and stock exchanges—the STAR Platform empowers organizations to achieve regulatory compliance while safeguarding their integrity and business reputations. Through a customizable, 360-degree view of employee activity, STAR software enables firms to automate the detection and resolution of potential areas of conflict while streamlining daily workflows and increasing efficiency. For more information, please visit www.starcompliance.com.
About Marlin Equity Partners
Marlin Equity Partners is a global investment firm with over $7.4 billion of capital under management. The firm is focused on providing corporate parents, shareholders and other stakeholders with tailored solutions that meet their business and liquidity needs. Marlin invests in businesses across multiple industries where its capital base, industry relationships and extensive network of operational resources significantly strengthen a company’s outlook and enhance value. Since its inception, Marlin, through its group of funds and related companies, has successfully completed over 170 acquisitions. The firm is headquartered in Los Angeles, California with an additional office in London. For more information, please visit www.marlinequity.com.
About Luminate Capital
Luminate Capital Partners is a private equity firm investing in growth software companies. Luminate partners with management teams to provide capital to drive strategy, growth, and operational improvements. Luminate’s portfolio of market leaders has also included Conexiom, Fintech, Oversight Systems, LiquidFrameworks, PDI, StarCompliance, and Thought Industries. For more information, please visit https://www.luminatecapital.com.
CONTACT: Melissa Macatuno, 240-599-1098, [email protected]
JPMorgan's profits jump as economy, investment bank recovers – BNN
CHARLOTTE, N.C. — JPMorgan Chase & Co., the nation’s largest bank by assets, said its fourth quarter profits jumped by 42 per cent from a year earlier, as the firm’s investment banking division had a stellar quarter and its balance sheet improved despite the pandemic.
The New York-based bank said it earned a profit of US$12.14 billion, or US$3.79 per share, up from a profit of US$8.52 billion, or US$2.57 per share, in the same period a year ago. Excluding one-time items, the bank earned US$3.07 a share, which is well above the US$2.62 per share forecast analysts had for the bank.
The one-time item was JPMorgan “releasing” some of the funds it had set aside last year to cover potential loan losses caused by the coronavirus pandemic and subsequent recession. Banks had set aside tens of billions of dollars to cover potentially bad loans, and JPMorgan had been particularly aggressive in setting aside funds early in the pandemic.
Releasing those funds goes straight to a bank’s bottom line when it reports its results, but it’s not money that the bank generated from loans, customers or borrowers. It’s just funds that were effectively put into escrow and are no longer in escrow.
The US$1.9 billion release is only a fraction of what JPMorgan set aside last year, and with the pandemic raging across the globe and particularly here in the U.S., it’s uncertain how much more the bank will release in the upcoming quarter.
“While positive vaccine and stimulus developments contributed to these reserve releases this quarter, our credit reserves of over US$30 billion continue to reflect significant near-term economic uncertainty,” said JPMorgan CEO Jamie Dimon in a statement.
The driver of JPMorgan’s profits this quarter was the investment banking business. The corporate and investment bank posted a profit of US$5.35 billion compared with US$2.94 billion in the same period a year earlier. JPMorgan said it saw higher investment banking fees — money banks collect to advise companies on going public or buying other companies — as well as higher fees from its trading desks.
Shares in China’s Xiaomi tumble after US investment ban – Financial Times
Shares in China’s Xiaomi sank after the US government added the smartphone group to an investment blacklist, in a move that is likely to thin its ranks of American shareholders.
The Beijing-based company’s stock dropped 10.3 per cent in Hong Kong trading on Friday, hours after the Pentagon added it to a list of companies with suspected ties to the Chinese military. That, in conjunction with a separate executive order, will block US investors from buying its shares 60 days from now and will require Americans to eventually sell their holdings.
The move marks a significant blow for Xiaomi, which had been a big beneficiary of Washington’s campaign of sanctions against Chinese competitor Huawei. That had helped Xiaomi’s sales to surpass US group Apple’s, making it the world’s number three phonemaker by units sold in the third quarter.
Its shares soared 227 per cent last year, pumping up its market value at the end of 2020 to $108bn. Large Xiaomi shareholders include US fund managers BlackRock, Vanguard, Fidelity and State Street, according to Bloomberg data. Friday’s share price fall cut Xiaomi’s market capitalisation by more than $10bn.
State Street declined to comment on its Xiaomi holdings. Vanguard, Fidelity and BlackRock did not respond to requests for comment.
“Xiaomi’s political risks have dramatically increased,” said Wu Yiwen at Strategy Analytics, adding that the blacklisting could threaten the company’s “aggressive expansion plan and affect partners’ confidence”.
An executive order from US President Donald Trump in November targeted US investments in Chinese businesses alleged to have ties to the country’s military. The Pentagon’s list included China’s three big state-owned telecom carriers, prompting the New York Stock Exchange to de-list the companies.
S&P Dow Jones Indices, MSCI and FTSE Russell all removed China Telecom, China Mobile and China Unicom from their global equity indices. But State Street decided that its $13.4bn fund that tracks Hong Kong’s Hang Seng index, which contains two of the telecom groups, could continue trading in securities of the sanctioned companies.
Wendy Wysong, a partner at the Hong Kong office of law firm Steptoe & Johnson, said the Trump executive order did not apply to foreign subsidiaries of US companies. However, she added that “a US company cannot evade the prohibitions by directing their Asian subsidiary to deal in the securities”.
The US defence department said the move against Xiaomi and eight other newly listed Chinese companies aimed to counter the country’s “military-civil fusion development strategy” but offered no evidence of the smartphone maker’s involvement in this.
Xiaomi said in a statement to the Hong Kong bourse on Friday that it was not controlled by, or affiliated to, the Chinese military and that it was “reviewing the potential consequences of this to develop a fuller understanding of its impact on the [company]”.
China’s foreign ministry said on Friday the US was abusing its state power, adding that it would “take necessary measures to protect the legitimate interests of Chinese companies”.
Analysts say the case against Xiaomi is thin and could be reversed under the incoming Biden administration.
“Although it won’t be Biden’s priority to undo each and every one of Trump’s outgoing moves, the Xiaomi investment ban’s deadlines could be postponed — most likely for a few weeks at first, then possibly more durably,” said Andrew Bishop, head of research at policy risk consultancy Signum Global.
CK Lu, an analyst at research firm Gartner, said the investment ban would not affect Xiaomi’s products or supply chain but could hit its ability to raise capital if US shareholders could not buy its shares.
Nian Liu contributed reporting from Beijing.
Couche-Tard Plans $3.6 Billion Investment in Target Carrefour – BNN
(Bloomberg) — Alimentation Couche-Tard Inc. plans to pump 3 billion euros ($3.6 billion) into Carrefour SA as the Canadian convenience-store operator seeks to defuse mounting French political concerns over the proposed $20 billion takeover of the French retailer.
Couche-Tard plans to spend that amount over five years, prioritizing investment over cost cuts or job reductions, according to a person familiar with the situation who asked not to be identified because the information isn’t public.
Carrefour shares fell as much as 5.2% after French Finance Minister Bruno Le Maire said Friday that he was prepared to give a “clear and definitive no” to the deal. He previously cited concerns about a French supermarket chain falling into foreign hands, saying the country needs to maintain domestic control over its food supply.
Bloomberg reported Thursday that the finance ministry is ready to study the proposal once the Canadians officially present it, citing people familiar with the matter who didn’t want to be identified. They said President Emmanuel Macron’s administration plans to take as long as needed to assess its impact on jobs and the sector.
Carrefour employs around 100,000 people in France and is the country’s largest private employer. The company has been implementing a turnaround plan under Chief Executive Officer Alexandre Bompard that involves investments in online shopping and organic food. Analysts point to the absence of geographical overlap between the companies.
The investment plan was reported first by Les Echos, which is owned by Bernard Arnault’s LVMH. Arnault also controls a 5.5% stake in Carrefour.
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