Ardian, the second-biggest secondaries firm according to the SI 50, is planning to close its latest flagship fund next year after a record period for deployment.
The Paris-headquartered firm expects to hold the final close on Ardian Secondary Fund IX in the second quarter of next year, according to documents prepared by consultant StepStone for the Pennsylvania State Employees’ Retirement System‘s 22 September investment committee meeting.
ASF IX is seeking $15 billion, according to Secondaries Investor data.
StepStone identified Ardian’s successful and stable track record of net returns, its experienced investment team, and diversified sourcing channels and active monitoring database among reasons why PA SERS should consider committing to the fund.
The consultant also noted that senior level investment departures, a secondaries market “flooded” with capital by a factor of 13 times over the past 16 years, and that Ardian’s team is not solely dedicated to secondaries, as potential risk factors.
StepStone recommended a $100 million commitment to ASF IX and a $50 million commitment to a no fee/no carry co-investment vehicle that will invest alongside the fund.
A supply and demand imbalance in the secondaries market favours the buy side, Ardian founder and president Dominique Senequier told the committee, which was live streamed and viewed by affiliate title Buyouts.
“Many LPs are now looking to sell assets to free up private capital. It has created an unprecedented opportunity for secondaries, particularly in the areas where we are focused,” Senequier said.
Ardian’s secondaries team has delivered a consolidated performance of a 1.64x multiple and an 18 percent net internal rate of return since inception, according to a slide presentation for the PA SERS meeting. It has offered more than $18 billion of co-investment dealflow to LPs since its ASF IV, which closed in 2007, to March this year.
The firm expects the market will see more than $300 billion of annual secondaries deal volume by 2030, according to the slides.
Ardian was planning to hold a first close on more than $10 billion for ASF IX in the autumn, Secondaries Investor reported in July. The firm closed a record number of secondaries deals last year by volume, with $16.8 billion across 27 secondaries deals, according to figures published in its annual activity report.
This means that of the $30.9 billion the firm invested across all its business strategies, 54 percent was for secondaries transactions. More than 85 percent of those secondary transactions were LPs portfolios, according to the report.
A spokesperson for Ardian declined to comment on fundraising and the PA SERS documents.
– Gregg Gethard contributed to this report.