Architectural Cases

A prevalent strategy within the private equity landscape, known as continuation vehicles, is currently under intense scrutiny following a notable setback involving United Site Services (USS), a company specializing in portable sanitation solutions. This situation has led to considerable financial implications for several prominent investment firms, drawing attention to the inherent risks associated with such investment structures, especially when facing volatile market conditions and operational challenges. The incident serves as a stark reminder of how even seemingly promising ventures can falter, resulting in significant capital depreciation for investors.

Platinum Equity established a continuation vehicle in 2021 with the express purpose of transferring USS from one of its established private equity funds into a newly formed fund. This strategic maneuver appraised USS at a substantial valuation of $4 billion, designed to facilitate an exit for initial fund investors, allowing them to liquidate approximately $2.6 billion of their holdings without an outright sale of the company. This approach has become increasingly common as a mechanism to realize value from assets in a sluggish deal-making and initial public offering environment, offering liquidity to existing stakeholders while retaining a promising asset within a firm's portfolio.

However, the anticipated success of USS did not materialize. Despite initial projections based on a post-COVID resurgence in events and construction activities, the company encountered significant operational and financial headwinds. Elevated interest rates negatively impacted the construction sector, a crucial client base for portable sanitation services, and simultaneously strained USS's own financial health, as debt servicing consumed a substantial portion of its cash flow. Furthermore, the company struggled to effectively integrate its numerous prior acquisitions, exacerbating its operational difficulties.

As a direct consequence of these challenges, Platinum Equity is reportedly preparing to cede operational control of USS to its lenders, which include Clearlake Capital and Searchlight Capital Partners. This impending handover is widely expected to result in a complete financial loss for investors who participated in the continuation vehicle, highlighting the severe consequences of a highly concentrated, single-asset fund strategy. The situation underscores the precarious nature of such investments, where a singular focus on one asset can amplify exposure to specific market downturns and operational failures, leading to irreversible financial damage.

This case vividly illustrates the potential pitfalls of continuation vehicles, a financial instrument that accounted for nearly 20% of all private asset exits during the first half of 2025, according to analyses from financial institutions. While these vehicles provide private equity firms with enhanced flexibility to extend their ownership of high-potential assets, the considerable losses incurred by USS investors demonstrate that such structures can expose new capital providers to illiquid, concentrated, and ultimately unsuccessful investments. The experience serves as a crucial cautionary tale for investors navigating the complex landscape of private equity strategies.

Novo Nordisk recently took a significant step in expanding its chronic weight management treatment portfolio by submitting a supplemental marketing application to the U.S. Food and Drug Administration (FDA). This application seeks approval for a new, higher dose of its semaglutide injection, Wegovy, specifically 7.2 mg, building on the success of its existing 2.4 mg formulation.

This initiative follows a parallel review process in Europe, where the European Medicines Agency, along with regulatory bodies in the U.K. and other countries, is already evaluating the 7.2 mg dose. Novo Nordisk projects a regulatory decision from the EU in the first quarter of 2026. The FDA's review, facilitated by the Commissioner's National Priority Voucher (CNPV) expedited program, is anticipated to conclude within one to two months after the agency accepts the filing.

The application for this higher dose is bolstered by robust findings from the STEP UP clinical trial, a 72-week, phase 3 study. This trial rigorously assessed the effectiveness and safety of once-weekly semaglutide 7.2 mg against both a placebo and the established semaglutide 2.4 mg dose in a cohort of 1,407 adults suffering from obesity, explicitly excluding individuals with diabetes. The results showcased a remarkable average weight reduction of 20.7% in patients receiving the 7.2 mg dose, significantly surpassing the 17.5% achieved with the 2.4 mg dose and a mere 2.4% in the placebo group. Furthermore, a substantial 33.2% of participants on the higher dose achieved a weight loss of 25% or more, a notable improvement over the 16.7% for the 2.4 mg dose and zero percent for placebo, highlighting the enhanced efficacy of the new formulation.

This development signifies a promising advancement in the treatment of obesity, offering a more potent option for individuals seeking effective chronic weight management. The positive outcomes from the STEP UP trial underscore the potential of this higher-dose semaglutide to significantly improve health outcomes and quality of life for a broad patient population. The expedited review by regulatory bodies reflects the urgent need and high anticipation for such innovative therapeutic solutions in addressing the global health challenge of obesity.