Deal of the Week: Launch of family office-backed SPAC underlines growing appetite for deals

One of America’s richest individuals and the head of an Ivy League endowment have set up a special purpose acquisition company (SPAC) fund to buy companies as much of the world begins to moves out of the coronavirus lockdown.

Barry Sternlicht, through his family office, Jaws Estates Capital, and Joseph Dowling, the chief executive of the Brown University investment office, have created Jaws Acquisition Corp to buy: “leading, growth-oriented companies across a variety of industries,” according to the SEC filing for the SPAC. 

The move shows family offices are seriously gearing up to do bigger deals as the coronavirus lockdown begins to ease in the big economies

The filing added: “We (Sternlicht and Dowling) do not intend to target industries that are competitive with Starwood Capital Group Holdings…which includes real estate, lodging, oil and gas and energy infrastructure.” Speculation suggests Jaws will target consumer companies. 

Sternlicht, through his investment group Starwood, is one of America’s savviest  investors, particularly in real estate and hotel sector. He’s probably best known for acquiring and running the upmarket hotel chains, Westin Hotels and Sheraton Hotels, but has diversified into other areas like oil and gas, and the energy sector. 

The SEC filing added: “Investment opportunities will be sourced from the founders proprietary network of operating network of executives, investors and advisors.” 

Sternlicht certainly is well connected, both with investment banks – he bought Westin Hotels with the backing of Goldman Sachs – and last year Starwood co-invested with L Catterton, the private equity group backed by Bernard Arnault, Europe’s richest man. 

Dowling is well respected in the investment community having set up an asset management group and worked for hedge fund Tudor Investments before joining the Rhode Island-based Ivy League. At Brown, he achieved top quartile performance for the endowment during much of his time since joining as chief investment officer in 2013. Sternlicht is an alumnus of Brown. 

The move shows family offices are seriously gearing up to do bigger deals as the coronavirus lockdown begins to ease in the big economies.