Quite a turnaround
As recently as a few years ago, portfolio management was still a fairly undeveloped concept, and there was still a degree of stigma attached to secondary sales. So when The Carlyle Group announced an offer to provide potential investors in it latest fund with a mechanism for selling their fund interests to secondary buyers, it really did feel like a watershed moment.
A mechanism like this represents quite a turnaround. Whereas once GPs would actively discourage LPs from selling their fund interests to a third party, or at best approve it only grudgingly, now they’re actively coming up with ways to facilitate the process. A sign of the times, if ever there was one.
The articles in this supplement clearly illustrate that as LPs have become more and more sophisticated, portfolio management has become increasingly sophisticated too. This is partly driven by necessity – compliance with regulatory pressures, for example, or the need to reduce GP relationships to a more manageable number.
In any case, expect more GPs to follow Carylyle's lead and accept this as the new reality.
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Portfolio Management Atlas 2012 Supplement