CVC set to buy Glendower amid secondaries M&A frenzy

CVC Capital Partners, the third-ranked manager on the PEI 300 and top-ranked European manager, is set to be the latest mega firm to enter the secondaries market.

The Luxembourg-based firm is in the advanced stages of talks with mid-market private secondaries specialist Glendower Capital, according to two sources familiar with the matter. It is understood that Glendower’s management will stay on as part of the deal and that the firm will continue to operate under the Glendower name.

Affiliate title Secondaries Investor first reported in May 2020 that CVC had been in talks with potential candidates about building a secondaries business but stopped due to the onset of the pandemic, among other reasons.

The development comes as Glendower eyes the target of its latest vehicle. The London-headquartered firm has amassed $2.5 billion out of a $3.5 billion target for Glendower Capital Secondary Opportunities Fund V, according to a source familiar with the fundraise.

News of the potential tie-up was first reported by Bloomberg.

Glendower spun out of Deutsche Asset Management in 2017, as affiliate title Secondaries Investor reported.

The firm is also raising its inaugural Glendower Capital Strategic Partnership fund. The exact strategy of the fund is not clear.

Among the deals it has backed in 2021 are a €700 million single-asset process on DomusVi Group, one of Europe’s largest care home providers.

For CVC, which has $79 billion of assets under management, the acquisition adds a secondaries product offering to its private equity, credit, growth and long-duration strategies.

Glendower was named in a 2019 Pitchbook list of the most attractive firms for a GP stakes investment, as Secondaries Investor reported.

At least five secondaries firms have been acquired so far this year. In July alone, Swiss secondaries firm Montana Capital Partners was acquired by PGIM, the asset management arm of insurance company Prudential Financial; StepStone Group acquired Baltimore-based Greenspring Associates to bolster its capabilities in secondaries, among other strategies; and Tikehau Capital acquired Singapore-headquartered Foundation Private Equity to expand its footprint into Asian secondaries.

Continued consolidation in the secondaries market was to be a key future theme, as Glendower’s own managing partner Carlo Pirzio-Biroli predicted to us in late 2019.

Glendower and CVC declined to comment.