HarbourVest, AlpInvest to lead €400m BDC secondary deal

The BT Pension Scheme is selling its interest in Bridgepoint Development Capital as part of a reorganisation of its private equity portfolio.

A group of secondary investors led by HarbourVest Partners and AlpInvest Partners are poised to acquire the BT Pension Scheme's €400 million investment in funds managed by Bridgepoint Development Capital, PEI has learned.

The deal has been agreed and could sign as early as Friday, according to a secondary market source.

BDC is the small-cap arm of Bridgepoint, a UK-based upper mid-market investor. BDC came into being in 2009 when Hermes, the group that manages the BT Pension Scheme, appointed Bridgepoint to manage its direct private equity investment. As part of that deal, Hermes' 10-strong direct investment team transferred to Bridgepoint, where they have since operated as a separate division under the name of Bridgepoint Development Capital. 

The BT Pension Scheme was the sole sponsor of the Hermes funds, so its BDC fund investment is a legacy of this transaction. 

The pension could not be reached for comment, but has previously admitted that it is looking to reorganise its private equity portfolio.

The source added that BDC had been able to raise a further €200 million for its current fund, BDC I, as a by-product of this secondary process, taking its total assets under management to €750 million. Almost half of this total is thought to be still available for new investments.

Bridgepoint declined to comment. HarbourVest also declined to comment, while Alpinvest could not be reached for comment at press time.