Abbott Capital returns with sophomore secondaries fund

Details of Abbott Secondary Opportunities II's hurdle rate and carried interest were revealed in US pension documents.

Abbott Capital Management has returned to market with its sophomore dedicated secondaries fund, two years after having closed its debut vehicle.

The fund of funds manager is targeting $250 million for Abbott Secondary Opportunities II and was targeting a first close on 31 January, according to documents posted by Ventura County Employees Retirement Association.

The fund has an eight-year term with two one-year extensions at the general partner’s discretion. It has carried interest of 10 percent and a hurdle rate of 8 percent.

VCERA, whose chief investment officer recommended a $25 million commitment to Secondary Opportunities II, will pay a fee of 1 percent of invested capital from years one to five, and 90 percent of the prior year’s management fee from year six on, the documents noted.

Fund II acquires single limited partner interests and small portfolios, and backs complex deals at the smaller end of the secondaries market. The fund will lean on relationships formed through its primary platform for deal sourcing, and less so on intermediated processes.

Predecessor Abbott Secondary Opportunities raised $208 million by final close in 2017 with VCERA committing $25 million, according to Secondaries Investor data.

As of 31 December it had called $19.1 million and returned a total value to paid-in multiple of 1.22x and a net internal rate of return of 20.1 percent, the VCERA documents noted.

Since 2000, Abbott has delivered a net IRR of 22 percent through secondaries capital put to work via its funds of funds, dedicated vehicles and custom mandates. North American assets account for 92 percent of its capital, with the remainder in Europe and Asia-Pacific.

So far in 2020 secondaries funds holding a final close have raised $20.59 billion, against $37.16 billion for full-year 2019, according to Secondaries Investor data.