Morgan Creek bolsters Asia team

The US-headquartered fund of funds has hired Anand Prasanna from Squadron Capital as a director in Shanghai.

Anand Prasanna will join Morgan Creek Capital Management in Shanghai as an investment director, according to a company statement. The move comes just weeks after Prasanna’s departure from Squadron Capital. 

Prasanna will begin his role in December, the firm said, and focus on Asia — in particular on India. Previously he worked at McKinsey & Company and Sequoia Capital in India. Morgan Creek now has eight investment team members in Shanghai. 

Prasanna left Squadron in November, shortly after US-based fund of funds FLAG Capital acquired the firm, PE Asia reported earlier. By partnering with Squadron, which has $1.5 billion of assets under management, FLAG brought its total assets from about $4.7 billion to more than $6 billion. The deal marked the first time FLAG has acquired another fund of funds in its 18-year history.

FLAG’s acquisition was part of a wider trend in the funds of funds industry, where a number of firms are consolidating. In September, BlackRock Asset Management acquired the fund of funds arm of insurance company Swiss Re.

“The fund of funds model in Asia is challenged in many of the same ways it is in the US and Europe and the principal issue is the double layer of fees,” said Nirav Kachalia, managing director at Morgan Creek, in a recent interview with PE Asia. 

“This is a particular issue at a time when LPs are lowering their return expectations for private equity. But there is added pressure on the model as many of the more successful GP groups here are doing a very good job of brand-building and developing their investor relations capabilities.”

Morgan Creek has four offices worldwide, with two in Asia located in Singapore and Shanghai. The firm has $8 billion in assets under management, first investing in private equity in 2005, according to PE Asia’s data division.