Lexington collects record $7bn for secondaries

The firm has closed its seventh fund on $7bn and has raised an additional $650m for Lexington Middle Market Investors II, a complementary vehicle to invest in ‘young’ private equity interests.

Lexington Partners has closed its seventh secondaries fund on $7 billion, attracting commitments from more than 200 investors in 20 countries for what is understood to be the largest secondaries fund ever raised.

Launched in early 2009 with a $5 billion target, Fund VII attracted interest in excess of its $7 billion hard-cap and received commitments from a record number of new limited partners, according to a statement. Approximately 60 percent of investors in the fund came from the US, with the remaining 40 percent coming from the UK, Europe, China, Canada, the Middle East, South America, Australia and the Asia-Pacific region. Park Hill Group has worked as placement agent for the fund, approximately 40 percent of which has been committed to transactions with banks, financial institutions, endowments, foundations and pension funds.

Lexington has also collected $650 million for Lexington Middle Market Investors II, a complementary vehicle to acquire “young” private equity interests less than 50 percent invested. Lexington’s first mid-market fund closed in 2005.

The firm, which closed its sixth fund on $3.8 billion in 2006, counts some of the biggest LPs in the industry in its funds, including Florida’s state pension system, Australia-based ESI Super and Australia Post Superannuation Scheme and the China Investment Corporation. Lexington’s investor list includes more than 200 corporate and public pension funds, sovereign investment authorities, insurance companies, financial institutions and endowments.

Last year, the Florida State Board of Administration bought an undisclosed stake in the firm for about $41 million.

Lexington was formed in 1994 by Brent Nicklas, who was a founding partner of Landmark Partners. The firm, with offices in New York, Boston, Menlo Park, London and Hong Kong, has completed more than 290 secondaries transactions, 98 co-investments and over 200 fund commitments, investing a total of $14.34 billion, according to the firm's web site.