Alliance Trust winds down private equity unit

The £2.6bn listed UK investment trust is quitting its private equity programme five years after its formation.

Alliance Trust, a 123-year-old listed investment trust with £2.6 billion (€3 billion; $4.2 billion) under management, will wind down its private equity unit.

“This will enable Alliance Trust to focus on its core investment portfolio and the development of its subsidiary businesses, Alliance Trust Savings Limited and Alliance Trust Asset Management Limited,” the group said in a statement earlier this week.

Alliance Trust Equity Partners (ATEP) – led by Raymond Abbott – has been running a fund investment programme for its parent company, backing managers such as ECI Partners and Alcuin in the UK and Polaris Private Equity in Denmark. The group also made commitments to Climate Change Capital, a clean energy and low carbon-focused fund manager.

ATEP managed around £110 million of trust assets as at the end of February 2011.

The ATEP division was created at the height of the private equity boom in 2007 with a remit to increase the group’s exposure to private equity through fund commitments and direct co-investments. Prior to this, Alliance Trust’s private equity activity had been limited to direct venture capital investments made by a VC team acquired by the group in 2006.