He said it

“On one hand, we’re worried about retention of staff in GPs, but more people coming into the industry will make Japanese private equity more sophisticated in the long term, we believe.”

Hikojiro Iida, co-head of PE at Nissay Asset Management, discusses the pros and cons of global firms entering Japan.

Just happened

Everything Evercore

Investment bank Evercore appears to be on a roll. The firm’s private capital advisory business, which works with LPs and GPs on secondaries sales, has usurped long-time king Greenhill as the biggest advisor in the sector, according to sister title Secondaries Investor‘s Advisory Survey 2020, published on Wednesday. The PCA unit, led by global head Nigel Dawn (pictured), worked on a whopping $18.4 billion of secondaries transactions, a 40 percent increase on its 2018 figure. It’s little wonder Evercore cleaned up in the PEI Awards 2019 with six wins including Placement Agent of the Year in North America and Asia, as well as its GP stakes specialist Saul Goodman being named PEI‘s Game Changer of the year.

The question is: can the firm maintain its momentum? The coronavirus crisis has largely put the M&A market on hold and caused some deals to be terminated as principals are sidelined until the economy and markets recover, Evercore warned in its Q1 results yesterday. “We have faced dislocations before, but never one like that facing all of us now,” Evercore founder Roger Altman noted.

Wafra’s advice to GPs

At a time when LPs are taking a more cautious approach to their PE allocations, here’s what GPs should be doing: focus on deals. So says, Wafra CIO Russell Valdez, who tells us that those that will get done in this environment are not through competitive auction processes but those that bank on “strong existing relationships”. Another word of advice: overcommunicate to LPs. This provides valuable info to LPs and informs on their capital deployment plans for the remainder of the year. Look out for the Q&A later today.

Essentials

Infra webinar take 2. The Infrastructure Investor team is back with the second webinar available exclusively to delegates to its Global Summit event (rescheduled for 12-15 October 2020). For those who haven’t signed up for the event, the three key takeaways from this discussion – which was about evolving sentiment towards co-investment and direct investment – were:

• Co-investment take-up in infrastructure is still not as high compared with other asset classes (PE, for example);
• If you’re going direct, the ability to attract and retain talent is key, with scale a close second (both also useful for your co-invest programme);
• It’s not just about underwriting, asset management is crucial too (particularly if you’re going direct).

A special time for special sits. We flagged a scoop earlier this week about some former Apollo execs making headway in their sophomore fundraise to invest in western European asset-backed corporate and real estate special situations. On a similar theme, York Capital Management has just closed its third special opportunities fund on $800 million, sister publication Buyouts reports.

Sad but true. Thanks for the Twitter user who alerted us to the below. It’s enough to put you off your coffee … nearly.

Inside tip

Have news or views you’d like to share with us, on this or else? We’d love to hear from you.

Dig deeper

What’s up with WSIB. Washington State Investment Board will make a commitment up to $300 million to Francisco Partners VI, a contact at the pension informed Private Equity International. The US public pension has a 23 percent target allocation to private equity that currently stands at 16.9 percent. The LP has made 16 commitments to funds of 2019 or 2020 vintage, which combined constitute $4.4 billion.

For more information on WSIB, as well as more than 5,900 other institutions, check out the PEI database.

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Today’s letter was prepared by Toby Mitchenall, Adam Le, Bruno Alves, Carmela Mendoza and Alex Lynn.

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