Adams Street Partners has held a final close on $1 billion for its Adams Street Global Secondary Fund V, well above its $750 million target.
Adams Street was in market for roughly a year with the fund, which had a $1 billion hard-cap. Roughly two-thirds of the capital in Fund V comes from existing investors.
“The exciting part was a lot of interest from new clients that are interested in our secondary product that weren’t your typical Adams Street type of a client,” partner at Adams Street Jason Gull told Private Equity International.
The fund close comes during a lull in the secondaries market, as potential sellers of assets have largely decided to hold their LP interests and delay selling, Gull said.
“In the past six months in particular there has been a definite slowdown in the market,” he said. “It’s not that there’s a wide bid-ask spread, it’s just apathy. It’s a seller’s market.”
While the secondary market reached peak levels of around $25 billion consecutively in 2011 and 2012, this year has not seen the same pace of deal activity so far, setting up 2013 for what could be a sluggish year if the current trend continues.
Limited partners in Fund V vary from sovereign wealth funds, public and private pension funds and insurance companies to endowments, foundations and high net-worth individuals. US pensions committing to Fund V include the Chicago Teachers’ Pension Fund, the Minnesota State Board of Investment and the Orange County Employees Retirement System, according to Private Equity International’s Research & Analytics division.
Fund V will invest using the same strategy as Adams Street’s previous secondary vehicles, targeting opportunities in both the small and large ends of the market. The firm’s secondaries group aims to invest between $5 million and $500 million in fund interests, direct secondary transactions and general partner restructurings.
Adams Street has invested less than 10 percent of Fund V to date in two transactions. The firm’s secondary programme now has about $2 billion in new capital to invest, including other managed accounts.
Adams Street manages more than $25 billion of committed capital in strategies including fund of funds, secondaries, co-investments and venture capital.