GP-Leds

Many public pensions face governance issues when considering continuation fund opportunities.

Both LP-led and GP-led deals made it to the list this year as market participants seek innovative ways to access liquidity.

Wider discounts in the LP portfolio market drew buyers to fund stake transactions over sponsor-initiated deals in H1, according to Holcombe Green, global head of private capital advisory at Lazard.

In 2023, continuation funds spread to geographic markets anew and niche strategies such as impact funds, while increasingly involving complex situations and assets.

The firm has been in conversations with certain LPs about bringing Fund VI to market, likely next year, it is understood.

Quilvest Capital Partners and Unigestion led the transaction, which is believed to be the first Article 9 continuation vehicle.

Strip sales, along with tender offers, structured/preferred equity and secondary directs, represented around 20% of the about $18bn in GP-led volume in the first half.

The market for GP-led deals has been overshadowed by large LP portfolio sales, but certain deals, especially those with what buyers consider high-quality assets, are finding their way to final close.

Jeff Hammer, global co-head of secondaries at Manulife Investment Management, discusses issues from moral hazard in continuation funds to the ethics of stapled deals with senior editor Adam Le.

The pension fund's proposal covers processes that involve contributing additional capital in continuation fund deals.