Pictet closes on $175m co-investment fund – Exclusive

The fundraise was limited in size due to a lack of investment opportunities.

Pictet Alternative Advisers, Pictet Group’s private equity, real estate and hedge fund management arm, has held the first and final close on its latest co-investment fund, Private Equity International has learned.

The firm amassed $175 million for Monte Rosa Co-investments III, which will primarily target buyout opportunities in Europe and North America, as well as a small number of Asian deals, according to Nicolas Campiche, chief executive of Pictet Alternative Assets.

The fund closed on 30 June after three months of fundraising, with the majority of commitments coming from Pictet’s asset management clients and several institutional investors.

The move follows an $815 million fundraise for Pictet’s flagship private equity fund of funds, Monte Rosa IV, in May. The fund was more than twice the size of its predecessor, which closed in 2015 on $304 million, according to PEI data.

Pictet has made almost 110 co-investments since 1992, of which 64 are realised. The firm has achieved an internal rate of return of around 35 percent across its realised investments, Campiche said, though it is unclear whether this applies to net or gross IRR.

“There is not enough capacity of quality co-investments in our view,” Campiche said. “We want to preserve [our] track record and not dilute the return achieved over the long term.

“We know that we could raise probably a multiple of [$175 million] easily but we are disciplining the process and I have decided to limit [the fund] to what we think is our ability to deploy in high quality deals over the next two to three years.”

The latest fund will take an “opportunity driven” approach, Campiche said. Pictet will itself offer co-investments to clients with primary, secondaries and existing co-investments with the firm.

Pictet analysed 26 co-investment opportunities last year and chose to invest in five.

Founded in 1991, Pictet Alternative Advisers manages around $20 billion on behalf of institutional and private clients, of which $9.2 billion is in private equity.