American private equity firm based in Santa Monica
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.[3][5][6][7]
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 "General partner-led Private-equity secondary markets".[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]
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 November 2020, Clearlake announced that it would acquire Endurance International Group for around $3 billion.[18] Following the acquisition, Clearlake combined Endurance's Web Presence division with Web.com to form Newfold Digital, a global web presence and domain name registration market leader.[19]
In October 2021, the firm acquired Cornerstone OnDemand a NASDAQ listed software company for $5.2 billion and took the company private.[20][21]
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]
