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Aberdeen Standard seeks $500m for secondaries

SOF IV is targeting $100m more than its predecessor and has a 10% hurdle rate, according to documents prepared for a US pension.

Aberdeen Standard Investments is back in market with its first post-merger secondaries fund.

The Edinburgh-headquartered investment manager is seeking $500 million for Aberdeen Standard Secondary Opportunities Fund IV, according to documents published by San Bernardino County Employees’ Retirement Association. This is $100 million more than the amount targeted for its predecessor, according to PEI data.

SBCERA’s investment advisor NEPC has recommended a $40 million commitment.

Similar to predecessor SOF III, the fund will invest in niche areas of the market including stakes in funds of funds and secondaries funds. SOF III raised $428 million, against a target of $400 million, by final close in October 2017.

SOF IV is targeting a first close for the first quarter of 2019 and could fundraise for up to 12 months after that, the documents noted. It is targeting a gross internal rate of return of 20 percent and, in a departure from the norm, has a hurdle of 10 percent.

It has an allocation of 40-60 percent to buyouts, 20-40 percent to venture capital and an opportunistic pocket which has previously included credit, natural resources and growth funds. Previous funds have invested 60 percent in the UK, 38 percent in North America and 2 percent elsewhere, the documents noted.

Standard Life and Aberdeen Asset Management merged in August creating an institution with a private equity pot worth £28 billion ($37.8 billion; €31.9 billion).

Aberdeen Standard’s private equity secondaries capabilities comprise SL Capital Partners’ three secondaries opportunity funds and Aberdeen’s secondaries team, which invests opportunistically in the strategy through separately managed accounts. The combined team is led by Patrick Knechtli, a former partner with SL Capital.

Aberdeen Standard did not respond to a request for comment by press time.