Private Equity Deals & Transactions

CD&R, Waterland and CVC top secondaries pricing list

Stakes in Clayton, Dubilier & Rice's 2008-vintage fund traded at a 15% premium to NAV, according to data compiled by Palico.

By
Rod James
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Clayton, Dubilier & Rice, Waterland Private Equity Investments and CVC Capital Partners topped a list of a dozen firms whose funds sold at premiums to net asset value in the six months to mid-August.

Stakes in CD&R’s 2008-vintage Fund VIII traded at the biggest premium at 115 percent of NAV, according to a list compiled by online private marketplace Palico. According to list, which looked at 25 transactions Palico had deal data for, interests in 12 of those funds traded at a premium.

The average fund stake traded at 99.7 percent of NAV.


Source: Palico
Some secondaries buyers are changing their strategies amid the high pricing environment. Aberdeen Asset Management, which was renamed to Aberdeen Standard Investments after its merger with Standard Life this year, is shifting to “seasoned primaries” – acquiring stakes in vehicles that have already held a first close and by final close hold several portfolio companies, where it feels it can get a better deal amid high pricing.

“Low discounts are definitely a reality, and are here to stay with the increasing efficiency in the secondaries market,” Daniel Dupont, managing director at Northleaf Capital Partners, noted in a guest commentary published in July in secondary publication Secondaries Investor.”Having said that, seeing hefty discounts as the only way to superior returns is a myth. One should never fear paying the right price for a quality portfolio, even at par or premium.”