NEWS & VIEWS

Global private equity and venture capital news and research

Secondaries

1 August 2013

Secondary pricing for buyout funds rises despite fall in volumep

During the first half of 2013, secondary pricing for buyout funds increased substantially when compared to the second half of 2012, as the average high first round bid for buyout funds was nearly 90 per cent of NAV - compared to 84 per cent in the second half of 2012.

15 June 2012

Secondaries provide key components of value creationp

As banks are selling non-core assets in order to meet capital requirements and institutional investors are increasingly using the secondary market as a tool for active portfolio management, the secondary market is expected to generate a large amount of investment opportunities throughout the remainder of 2012.

24 January 2012

Secondary buy-outs surge in Europep

Secondary buy-outs (SBOs) accounted for six of the top ten deals in Europe last year, according to new research.

1 August 2011

Record secondary deal activity in first half of 2011, reportp

During the first half of 2011, secondary transaction volume was estimated to be $14bn, distinguishing this period as the busiest first six months of any year in secondary market history, according to secondary specialist Cogent Partners.

5 July 2011

Value-based secondary investing across market cyclesp

The private equity secondary market underwent significant changes over the last decade and in particular over recent years as a result of the global financial and economic crisis. Based on Partners Group’s experience as an active investor in the secondary market since the late 1990s with over $7bn invested to date, this paper highlights how the global market for private equity secondaries is linked to economic development and which factors need to be considered in order to successfully create value at different stages of the cycle.

9 November 2010

Private equity secondary market valuation analysis, a report by Arnaud van Tichelenp

During the current liquidity crisis, the private equity industry has been reshaped and experienced a significant increase in the level of interest and activity in the secondary market. However, despite its growth, the market is still inherently inefficient and pricing tends to vary widely among bidders. Investors need to be aware of the challenges and dynamics of this fast evolving market and to carefully analyse each potential sourced opportunity.

28 May 2010

Private equity secondary market, valuation analysisp

During the current liquidity crisis, the private equity industry is being reshaped and there has been a significant increase in the level of interest and activity of the private equity secondary market. However, despite its growth, the market is still inherently inefficient and pricing tends to vary widely among bidders. Investors need to be aware of challenges and dynamics of the market to carefully assess opportunities in this fast-growing market.

28 August 2009

Private Equity Observations – Golden age of secondaries?p

With the collapse in private equity fundraising following record-setting years from 2005-2008, the global decline of public equity markets, frozen credit markets around the world and aggressive asset allocation strategies employed by many institutional investors, the private equity industry and its investors have been beset by challenges in the last year.

24 July 2009

Factors of success for secondary investing in the current market environmentp

The market for private equity secondaries has seen significant changes since the onset of the global financial and economic crisis. Based on Partners Group’s experience the following paper identifies key success factors for secondary investing under these new market conditions. These factors include the proactive sourcing of transactions, a thorough analysis of underlying assets as well as execution excellence in order to take full advantage of the current market disruptions.

5 June 2009

Capital Dynamics: Perspectives – a view of the private equity secondaries marketp

The markets continue to be difficult. Banks are still struggling and availability of longer term liquidity remains low. Most major economies are in a recession and it is currently unclear when the bottom will be reached. The global economic difficulties are also reflected in low valuations in the public markets which are increasingly reflected in private equity valuations. This is easing the pressure on private equity allocations. What seems more daunting is the possible liquidity issues that arise once draw downs start to pick up which we expect to happen prior to the increase in distributions. In addition, the current uncertainty drives up secondary market discounts with the result that there are few sellers at the prices buyers are willing to offer. Thus, currently the secondary market is relatively quiet. Much is being evaluated, but little is transacting. However, with increasing stabilization of the economic situation and an increasing liquidity pressure we expect the bid-ask spread to narrow and activity to pick up.

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