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Today’s secondaries technology can provide flexible solutions for GPs and LPs during times of market turmoil, say Mary Lavelle, Daniel Quinn and Fadi Samman at Akin Gump Strauss Hauer & Feld.
Times of uncertainty offer the buyside a window of opportunity, while sellers can benefit from liquidity, says Miguel Zurita, a managing partner at AltamarCAM Partners.
Such transactions can generate liquidity for LPs, validate a mark and allow a GP to retain control of a well-performing asset, says Todd Miller of W Capital Group.
The significance of a low take-up rate in a sponsor-initiated secondaries process isn't as cut and dried as it may seem.
LP portfolios accounted for close to half of the roughly $106bn in volume last year, according to the advisory firm and placement agent's 2023 Secondary Market Overview.
Pricing of assets and LP stakes remain points of contention between buyers and sellers, which has made it challenging for secondaries deals to reach final close.
The team behind the market’s biggest dedicated GP-led fund has a reputation for being clear, efficient and an intermediary’s dream via its 'sole buyer' strategy.
As managers and investors continue to struggle with liquidity issues, it is no longer business as usual for real estate recapitalisations.
Most fund sponsors invested additional capital on top of carry rollover in such processes last year, according to the investment bank's debut Secondary Market Survey Report.
Tender offers plus staples remain challenging because if the price isn't right, limited partners can simply choose not to sell.