Adams Street ups Asia allocation

The Chicago-headquartered firm, which launched its debut private credit fund early this year, has got Seoul, Kuala Lumpur, and Beijing on its investment radar.

Fund of funds Adams Street Partners now has around a 15 percent allocation to Asia, an increase and now consistent with the private equity allocation of its peers across Asia, partner and head of Asian investments Yar-Ping Soo told Private Equity International.

Adams Street, which manages about $28 billion of assets across primary and secondaries fund investments, co-investments, private debt, and direct venture and growth investment, has been investing in Asia for more than a decade. The firm has made commitments to several private equity funds in the region including Beijing-based CDH Investments, Mauritius-based ChrysCapital and Singapore-based KV Asia Capital, according to PEI data.

“In the current environment, returns are lower and funds are getting larger, and private equity [in Asia] is becoming a significantly attractive asset class,” Soo explained.

Aside from increasing its investment in to the region, Ben Hart, who was hired in January this year as partner and business development head in Asia said: “We are certainly looking at expansion in the future and we’ve got a number of places on our radar.”

“Seoul is definitely at the top of the list, and we’re actively monitoring other markets. We’re spending a lot of time in Kuala Lumpur, Hong Kong, Taipei, and Beijing.”

Asked about the increasing trend of LPs picking up GP stakes, Hart says the firm has nothing formal to announce. “At the moment, we’re focusing on launching new funds – we just launched our Private Credit strategy, and have had three successful first closes this year on new funds. We’ve increased our AUM by 10 percent and we’re achieving our strategic goals,” Hart said.

The firm is also keen to tap into Asia’s growing pool of institutional capital. Hart said the firm is “always looking for nascent areas of growth in Asia, as the new capital that’s coming from Asian LPs is substantial.”

“We also make frequent visits to Australia because of its large LP market. It really depends on making the right business case for the company as we go forward.”

The firm launched its first private credit fund in January targeting $500 million and brought in former Oaktree Capital Management executives Bill Sacher and Shahab Rashid to set up that platform.

“We’re providing equity cheques to many of these GPs in a highly complementary space. And, following the addition of our private credit team earlier this year, we’re making significant strides into the credit space by providing direct lending solutions to sponsor-led transactions,” said Hart.

The new strategy will be in addition to the current funds Adams Street is managing. Adams Street is in the process of deploying its 2014-vintage vehicle, Adams Street 2015 Global Fund – consisting of sub-funds 2015 US, 2015 non-US and 2015 direct – which held a final close on $725 million in October this year against a $800 million target. It is also busy raising capital for its global fund of funds programme Adams Street 2016 Global Fund, according to PEI data.

Adams Street works with more than 450 managers and sits on over 330 GP advisory boards.