Warburg Pincus to explore secondaries process – exclusive

The deal by one of the world's biggest private equity managers could be in the 'multi billions', sister publication Secondaries Investor has learned.

Warburg Pincus, the world’s fifth-largest private equity firm by assets raised in the last five years, is considering a GP-led secondaries process, Secondaries Investor has learned.

The New York-headquartered buyout firm is working with investment bank Lazard to advise on a potential deal, according to two sources familiar with the matter. One of the sources said the deal will be a “multibillion dollar” transaction. 

It is unclear which assets or funds Warburg Pincus has identified it wants to sell in the process.

Warburg Pincus’s most recent flagship vehicle is the 2015-vintage Warburg Pincus Private Equity XII, which closed above its $12 billion target on $13.4 billion, according to PEI data. The firm has raised at least $30.8 billion as of April, according to sister title Private Equity International‘s PEI 300 ranking of the biggest fundraisers since 2012.

Limited partners in that fund include Washington State Investment Board, which committed $750 million, New York State Common Retirement Fund, which committed $240 million and Michigan Department of Treasury, which committed $175 million.

GP-led processes such as fund restructurings and tenders offers accounted for 22 percent of secondaries deal volume last year, according to a June survey by advisory firm and placement agent Campbell Lutyens.

Prominent deals this year, such as London-headquartered buyout firm BC Partners’ stapled process on its 2011-vintage fund and Abu Dhabi sovereign wealth fund Mubadala Capital’s $2.5 billion stapled deal with Ardian, have demonstrated that GP-led processes are becoming mainstream, market sources told Secondaries Investor. 

Warburg Pincus and Lazard declined to comment.

 Adam Le, Marine Cole and Rod James contributed to this report.