He said it
“Somewhat ironically, the rise of remote investment – a fait accompli in other asset categories – leaves more time to meet in person with new and emerging managers; these managers take a record 22 percent of 2021’s fundraising.”
In a series of outrageous PE predictions for 2021, Antoine Dréan, founder of fund advisory Triago, says less established managers will benefit from the pivot to virtual fundraising.
Basketball courts PE
Buying a stake in a National Basketball Association team could be widened to include more firms than Dyal Capital Partners, according to Sports Business Journal (subscription required). The NBA is considering expanding the rules to allow additional private equity funds to acquire minority stakes, though no specific timetable has been set and nothing has yet been approved, the report said, citing league insiders. Key issues the NBA wants to debate first include limits on the size of any minority investment, the number of teams a fund could buy into and minimum periods of ownership.
PE investment in sports leagues and franchises – a trend that’s been catalysed amid the pandemic due to liquidity concerns – is an area we examined in our December Deep Dive, which you can read here.
Russian to close
Russia’s Elbrus Capital has reached a first close on its third fund, Private Equity International reported last week. Elbrus Capital Fund III closed on $165 million in December and has raised commitments of more than $260 million, some of which will be made available later in the fundraise. LP appetite for Russian PE has been uncertain in recent years due to the 2019 arrest of Baring Vostok Capital Partners founder Michael Calvey and several colleagues.
Co-investments in 2021
What next for the co-investment market? Asset management consultancy MJ Hudson has made a number of predictions for the year ahead. Here are some highlights:
- Spin-outs drive activity. More spin-outs will launch this year on a deal-by-deal basis and may use co-investments to seed their blind-pool funds in future.
- Blurred lines. The proliferation of GP-led secondaries transactions means the line between what constitutes a co-investment or a secondaries deal will become increasingly blurred.
- More transparency. Competition for LP capital may prompt emerging and smaller managers to outline more transparent co-investment allocation policies in their LPAs.
Paris-listed Eurazeo raised €2.8 billion across private market strategies last year, an 18 percent increase from 2019, according to a statement. The firm’s venture and growth funds raised more than €700 million last year, almost three times its 2019 total, while its China-focused vehicle partnered with the Chinese Investment Corporation and BNP Paribas to raise an initial tranche of €200 million. The firm also collected €290 million from retail investors. We profiled the firm in 2019 as one of three managers changing the PE landscape.
Making rain in Spain
Investor appetite for Spanish PE and VC does not appear to have been dented by the pandemic. Fundraising by Spanish PE vehicles climbed 6 percent to €2 billion last year, while VC funds collected a record €700 million, according to the Spanish Association of Private Equity & Venture Capital. Deal value fell 34 percent year-on-year to €5.6 billion across 765 transactions, though 2019’s total was bolstered by a number of sizable deals. Read our Q&A with ASCRI president Aquilino Peña from last year.
LP meetings. It’s Monday, so here are some LP meetings to watch out for this week.
- Ohio Bureau of Workers’ Compensation
- City of Philadelphia Board of Pensions & Retirement
- Tennessee Consolidated Retirement System
- Chicago Policemen’s Annuity & Benefits Fund
- State Universities Retirement System of Illinois