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Providence Equity Said to Sell Stake in Firm to Investors

Jonathan Nelson, CEO of Providence Equity Partners Inc., at the 2012 Allen & Co. Media and Technology Conference in Sun Valley, Idaho. His firm sold a minority stake to Florida's state pension system and a sovereign-wealth fund. Photographer: Scott Eells/Bloomberg
Jonathan Nelson, CEO of Providence Equity Partners Inc., at the 2012 Allen & Co. Media and Technology Conference in Sun Valley, Idaho. His firm sold a minority stake to Florida's state pension system and a sovereign-wealth fund. Photographer: Scott Eells/Bloomberg

Sept. 25 (Bloomberg) -- Providence Equity Partners Inc., the buyout firm with holdings in Univision Communications Inc. and the cable-television network of the New York Yankees, sold a minority stake to Florida’s state pension system and a sovereign-wealth fund, said a person with knowledge of the move.

Proceeds from the sale, which will give the two investors less than 10 percent in the company, will be used to expand the business, said the person, who asked not to be identified because the transaction was private. Dennis MacKee, a spokesman for the Florida State Board of Administration in Tallahassee, confirmed the state invested $150 million in Providence’s management company.

“We’ve invested in the area of $450 million in their funds since 2007,” MacKee said by telephone. “They have been good performers for us. We have a good relationship with them.”

Providence follows competitors such as TPG Capital and Apax Partners LP in selling stakes of their management companies as the firms seek capital to expand beyond traditional leveraged buyouts. CVC Capital Partners Ltd., based in London, told investors this month it agreed to sell a 10 percent stake to three sovereign-wealth funds, one in the Middle East and two in Asia, according to two people with knowledge of the move.

The two largest private-equity firms by assets, Blackstone Group LP and Carlyle Group LP, sold interests in their management companies through initial public offerings.

New Fund

Andrew Cole, a spokesman for Providence at Sard Verbinnen & Co., declined to comment.

The person didn’t disclose the identity of the wealth fund that bought part of Providence Equity.

Providence, which is based in Providence, Rhode Island, and which manages about $27 billion with a focus on investments in media and education, raised more than $4 billion as of May for its latest buyout fund, two people with knowledge of the matter said at the time. The firm is seeking as much as $6 billion and expects to close the fund by the end of the year, the people said.

Dow Jones’s LBO Wire reported Providence’s stake sale yesterday.

To contact the reporter on this story: Devin Banerjee in New York at dbanerjee2@bloomberg.net

To contact the editor responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net

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