AlpInvest to collect $4.6bn for secondaries

AlpInvest Secondaries Fund V has attracted $500m from new investors, raising $150m during the first quarter of 2013.

AlpInvest Partners, the Dutch fund of funds owned by The Carlyle Group, is soon to close a $4.6 billion fund for secondaries, Carlyle co-chief executive officer David Rubenstein said during a recent earnings call.

AlpInvest Secondaries Fund V launched in 2011 and had received commitments of about $3.48 billion as of the end of March, according to Carlyle’s first quarter 2013 earnings report. The fund raised $150 million in new commitments during the first quarter of the year, and has invested roughly $779.6 million. Of the amount raised so far, $500 million comes from new investors to AlpInvest, Rubenstein said.

AlpInvest’s newest secondaries fund comes during a relatively slow period for the private equity secondary market. While secondaries deal volume hit levels of around $25 billion consecutively in 2011 and 2012 – record-breaking deal activity numbers – 2013 is on track to come in well below that number, if the kind of sluggish deal activity seen in the early months of 2013 (and the last months of 2012) continues on through the year.

Across strategies, AlpInvest has mandates to invest about $8.7 billion in primary, secondary and co-investment opportunities between 2013 and 2015.

In February, Carlyle hired former president of Morgan Stanley Alternative Investment Partners Jacques Chappuis as a managing director and head of the firm’s Solutions business, in which AlpInvest is housed. Chappuis is charged with growing the division, which will no longer be comprised solely of fund of funds. A number of existing Carlyle products are to be consolidated into the Solutions business, such as separately managed accounts.

Carlyle’s Solutions business will also include portfolio advisory and risk management services “and other new initiatives that facilitate third party access to Carlyle funds”, according to a statement. Of the firm’s $176.3 billion of assets under management, $47.8 million fall under the Solutions business.

Carlyle is expecting to reach its $10 billion target for its flagship buyout fund Carlyle Partners VI later this year, Rubenstein said during the earnings call. The firm has 13 new or follow-on funds in the market and will introduce additional offerings later in the year.