Side Letter: Carlyle’s Africa staple deal, Secondaries roundtable, Guy Hands talks camping

Secondaries' sharpest minds share their thoughts on a $74 billion market, Carlyle mulled stapled deal to raise next Africa fund, Guy Hands on persistence. Here’s today's brief, for our valued subscribers only.

Just happened

Source: Doug Holt

A $74 billion market

Our latest roundtable saw execs from Ardian, Partners Group, Debevoise and others share some insightful nuggets about the future of the secondaries market. This is an industry that has grown 640 percent in the last 10 years, hitting $74 billion in deal volume last year. GPs who don’t show their LPs co-investment opportunities beware: some of these LPs are cutting such relationships and selling them on the secondaries market. Others drivers of sales include LPs looking to offload large portfolios (think $4 billion-$5 billion range) to unload risk ahead of a potential downturn.

“We’re spending an increasing amount of time with CIOs who are conscious of the fact that we are 10 years into a bull market and they’re starting to de-risk,” says Scott Beckelman, a managing director at Greenhill.

Carlyle’s staple deal

The Carlyle Group has been mulling using a stapled deal to raise its new Africa fund, per our colleagues at Secondaries Investor. The firm approached buyers about acquiring stakes in its 2013-vintage $698 million Sub-Saharan Africa Fund and making a stapled commitment to its successor, which sister publication Buyouts reported last week. The status of the deal is not clear. If it goes ahead, Carlyle will join Ares, Oaktree and TPG on the list of brand-name firms that have used secondaries processes in the past six months.

Guy Hands persists

Persistence can get you a long way. This is true for Guy Hands, who tells the BBC he got into Oxford University by camping outside a college and persuading staff to give him an interview in his younger days. A secretary took pity on him and arranged an interview for him days later. The Terra Firma founder is now worth an estimated £265 million ($336 million; €302 million). Fundraising, on the other hand, is not proving as easy as getting into the world’s most famous university.


EQT’s impact investing vision. Don’t expect EQT to get on the impact bandwagon any time soon. The firm has always had a “sustainability filtering mechanism” in how it creates value, chief executive Christian Sinding tells PEI. The firm wants to take a stronger position on climate change and thematic investing with positive societal impact and is leading the Nordic PE community in working to define and measure impact. “There are a lot of initiatives, a lot of different checklists and approaches and what we really want is to help make the system usable, easy to understand and easy to scale,” Sinding adds.

Compliance wisdom. Missed out on our Private Fund Compliance Forum in New York last week? Our colleagues at sister title pfm are sharing their top insights. One thing that won’t surprise you: fees and expenses remain the number one issue the SEC picks up on during exams. And one thing that might: getting everything in writing isn’t always a good thing.

Dig deeper

Prairie state portfolio. Illinois Municipal Retirement Fund has approved $256 million in private equity commitments, according to investment materials from the pension’s May board meeting, including committing $200 million to HarbourVest 2019 Global Fund. Here’s a breakdown of the $42.70 billion pension plan’s portfolio. For more information on IMRF, as well as more than 6,700 other institutions, check out the PEI database.

He said it

“In 2011 Uber had a value of around $60 million… It is now worth around 1,000 times that. That won’t mean we have made a 1,000 times return, because we invested in various stages, but it gives you a flavour of the opportunities private markets offer.”

Richard Hickman, director of HarbourVest Partners’ listed HVPE vehicle, tells The Telegraph about its exposure to the ride sharing app.

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Today’s letter was prepared by Toby MitchenallAdam LeIsobel MarkhamRod JamesCarmela Mendoza.

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