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TPG Is Evaluating a Public Listing

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TPG, one of the last of the original private-equity giants to remain a closely held partnership, is evaluating a public listing, people familiar with the matter said.

The firm is considering a straightforward initial public offering and a merger with a special-purpose acquisition company, with the former being the most likely route, the people said. Such a deal could value the California-and-Texas firm at about $10 billion, some of the people said.

The process is still in its early stages and TPG may not opt to proceed with any deal.

TPG, with nearly $100 billion in assets under management, has flirted with an IPO multiple times, only to end up balking while rivals forged ahead.

Blackstone Group Inc.,

BX -1.83%

Apollo Global Management Inc.,

APO -0.34%

KKR & Co. and Carlyle Group Inc. went public years ago, transforming businesses that have enjoyed rapid growth as the industry is flooded with assets.

“As we have consistently stated, we evaluate various strategic alternatives from time to time,” a TPG spokesman said in a statement. “No decisions have been made and we have nothing to announce at this time.”

With headquarters in San Francisco and Fort Worth, Texas, and offices around the world, TPG’s business lines include private equity, investing in fast-growing companies, socially responsible investing, real estate and public equity.

Founded in 1992 by Jim Coulter and

David Bonderman,

who met while working for investor

Robert Bass,

the firm spent much of its first decade doing big buyouts of companies like Continental Airlines and Burger King. In 2007, it launched TPG Growth, which has had success investing in midsize companies and those with rapid growth profiles including

Uber Technologies Inc.

and

Airbnb Inc.

But it has lagged behind peers in asset growth as some big deals it struck before and during the financial crisis faltered. Among them was TXU Corp., later renamed Energy Future Holdings Corp., which TPG bought with KKR in a $32 billion takeover in 2007. The utility filed for bankruptcy protection in 2014.

Since then, TPG has appointed a new crop of executives to oversee its flagship buyout and growth businesses and launched more than a dozen different investment strategies. It has focused its efforts, including in its buyout strategy, on deals in the technology and healthcare sectors, which it believes have the most growth potential and which require less leverage.

In February, TPG agreed to pay

AT&T Inc.

$1.8 billion for a 30% stake in the telecom giant’s struggling DirecTV unit. It paid $1.2 billion for a majority interest in

LifeStance Health Group Inc.

in April 2020. The outpatient-mental-health company, which went public in June of this year, now has a market value of more than $10 billion.

By moving forward with a listing now, TPG could benefit from a red-hot IPO market and a boom in SPACs, empty vehicles that raise money through listings and then look for businesses to take public through a merger.

The SPAC market has cooled of late, but a number of the vehicles remain on the hunt for a deal, and a well-known, successful business like TPG’s will likely be seen by many as a prize.

A number of SPACs have merged with investment firms, including

Altimar Acquisition Corp.

, which bought and combined Dyal Capital Partners and Owl Rock Capital Partners into Blue Owl Capital Inc.. The new entity began trading recently and has a market value of more than $16 billion. In August, Chicago asset manager

GCM Grosvenor

agreed to merge with CF Finance Acquisition Corp. in a deal valued at $2 billion including debt.

TPG has taken steps in recent months that could help prepare it for a listing. In May, the firm said Mr. Coulter, who had been serving as co-chief executive officer alongside Jon Winkelried, would become executive chairman and focus on the firm’s social-and-environmental impact strategy, with Mr. Winkelried becoming sole CEO.

Mr. Winkelried, who was president and co-chief operating officer of Goldman Sachs Group Inc. before joining TPG in 2015, is widely respected on Wall Street and has helped transform the firm from a buyout shop into a diversified asset manager.

In May 2020, TPG ended its relationship with its former affiliate Sixth Street Partners, with the credit-investing specialist taking back most of TPG’s roughly one-third stake. As part of the deal, both firms agreed not to start new businesses that would take them onto the other’s turf until 2021.

Write to Miriam Gottfried at Miriam.Gottfried@wsj.com and Cara Lombardo at cara.lombardo@wsj.com

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