Partners Group collects €2.5 billion for secondaries

Partners Group, a Switzerland-based private equity firm, has closed its sixth secondaries fund on its upper limit of €2.5 billion.


The Swiss-based group has closed its sixth secondaries fund

The fund, which will invest in the market for second-hand fund stakes, is larger than its predecessor, Partners Group Secondary 2011, which closed on €2 billion in 2012, according to a statement from the firm.

Investors in Partners Group Secondary 2015 include a mix of new and existing institutional investors from public and corporate pension plans, endowment funds and foundations, sovereign wealth funds, insurance companies and global financial institutions, Partners Group said.

In 2015, Partners Group saw significant deal flow and screened over $ 91 billion in secondaries deals but said that, in last year’s “high-price environment”, it declined 99% of these potential deals.

But Stephan Schäli, partner and co-head of private equity at Partners Group, said in the statement: “Given the current volatility in equity markets, we expect prices to come down from recent highs.”

He said: “Since the close of our 2011 programme, the private equity secondary market has further matured and is today an established portfolio management tool among the most sophisticated private markets investors. As a result, we benefit from increased deal flow.”

Partners Group made its first private equity secondaries investment in 1998. Since then, it has invested more than $ 13 billion in the strategy globally.

The fund closing comes as the secondaries market in general continues to grow: deal volume in the global secondaries market has increased to $ 40 billion in 2015, from $ 25 billion in 2011.

Secondary adviser Greenhill Cogent said in its Secondary Market Trends & Outlook report in January that it expects annual market volume to settle into the current band of $ 35 billion to $ 45 billion in 2016.

As a result, many firms have been raising dedicated secondary funds. Paris-based Ardian recently collected $ 10 billion its latest secondaries vehicle. Boston-based HarbourVest Partners is also raising a new secondaries fund, Dover Street IX, which is targeting $ 3.5 billion, while Coller Capital closed its seventh secondaries fund at $ 7.15 billion on December 31, 2015. After accounting for available leverage, Greenhill Cogent said in January that there is more than $ 80 billion of money available to invest in secondaries.

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