“We thought that to start with as a first step into the private equity world, having a large fund of funds platform was a good idea,” Nicolas Chaput, global chief executive of Oddo Asset Management, told Private Equity International.
“That’s a way for us to get a better understanding of the dynamics of some of the direct managers and we will probably launch additional direct investing initiatives in the future.”
Oddo – a global wealth manager and investment bank with €110 billion under management – entered private equity on 17 April with the acquisition of ACG Capital, the €1.8 billion fund of funds and secondaries arm of ACG Group. The move came amid growing demand for unlisted assets from the firm’s institutional and high-net-worth client base.
“Within a month we will go on a capital raising tour in Europe because we want to start offering a new product to clients, investing mostly in secondary deals,” Chaput said.
“The first one we want to concentrate on is this secondaries idea because we believe that’s probably where a good amount of value resides today. It’s also a good way to shorten the J-curve effect for clients and get a good deal for the money.”
The newly-rebranded Oddo BHF Private Equity will seek €300 million for secondaries from its existing client base of European and Middle Eastern institutional investors, Chaput said. The fund will have at least a 70 percent allocation to European and US buyout secondaries opportunities, as well as buckets for growth venture and infrastructure. Up to 30 percent of the fund will be deployed via primary fund commitments.
Oddo snapped up Ferdinand Dalhuisen, former global head of primary investments at Deutsche Bank Private Equity, in January to serve as co-head of the private equity fund of funds business and build on its German presence, according to Dalhuisen’s LinkedIn.
“The traditional investment base for ACG was very Frenchcentric, but what we’re bringing to the table is a large and deep client base in Germany, both on the institutional and high-net-worth side,” Chaput said, noting that the firm also has clients in Switzerland, Italy and the Nordics, among others.
Its asset management arm oversees around €61 billion for its clients, of which roughly 70 percent are institutional investors.
Oddo Group has also partnered with Hong Kong asset manager to launch Alpha Intelligence Capital, a $100 million venture capital fund targeting artificial intelligence companies in Asia. Oddo BHF Private Equity will serve as GP to the fund, which was expected to hold a first close on $45 million with commitments from only high-net-worth individuals this week.