Ardian’s secondaries dealmaking falls on back of record year for activity

The firm deployed 45% less capital in 2022 than its record of $16.8bn in 2021.

Ardian put the brakes on its secondaries deal activity last year on the back of its record period during the prior year.

The Paris-headquartered firm closed 16 secondaries transactions in 2022 with a deal volume of $9.3 billion, according to figures published Friday in its annual activity report. That compares with 27 deals closed worth $16.8 billion in 2021.

Overall secondaries transaction volume last year fell around 17 percent, according to data from investment bank Greenhill.

LPs’ needs to rebalance their private markets exposures due to the denominator effect “produced an unprecedented opportunity” for Ardian to “select portfolios of the highest-quality private companies at double-digit discounts to NAV on exceptionally favourable terms”, the report noted.

It added that its position to pick up these stakes was “further reinforced by the relative lack of competition to acquire the largest, multi-billion-dollar portfolios and our extremely high coverage of the best-performing private equity funds, most of which are already represented in Ardian’s secondary portfolio”.

Ardian’s largest secondaries transaction last year was a $2.2 billion deal, which it invested in during December, followed by a $2.1 billion deal which happened in September. Those two transactions made up 46 percent of the firm’s total secondaries deal volume for the year.

It made its first deals out of its latest flagship in 2022, the report noted. ASF IX is in market targeting $15 billion, according to Secondaries Investor data. The vehicle, which launched in February last year, had raised $10 billion as of October, the data shows.

Its $14 billion ASF VIII fund was 85 percent deployed at year end, the report added.

Abu Dhabi Investment Authority committed a total of $6 billion to Ardian to manage for secondaries, Secondaries Investor reported last year. The commitment was understood to comprise $4 billion to Fund IX and $2 billion for secondaries co-investments. It marked one of the largest known commitments to a standalone secondaries fund and commingled private markets fund.

Ardian invested in a portfolio of fund stakes and direct investments held on the balance sheet of Mubadala Capital, the asset management unit of sovereign fund Mubadala Investment Co, last year. The fund interests are with top-tier GPs mainly located in North America and Europe and were transferred to Mubadala Capital’s balance sheet during its spin-off from Mubadala Investment Company in 2021, Ardian’s report detailed.

Simultaneously, Ardian kicked in a primary commitment to Mubadala Capital’s fourth private equity fund.

Ardian also invested into GP-led secondaries, backing a process on Nordics-focused Norvestor VII, a 2016-vintage fund managed by Norvestor Equity. EurazeoNorthleaf Capital Partners and Rothschild Merchant Bank‘s Five Arrows unit were among the other investors in the continuation vehicle, which closed on €730 million, including €150 million of follow-on capital. Evercore advised on the deal.

The four assets in the continuation vehicle are campsite operator United Camping Holding, energy sourcing business Veni Energy Holding, compressed air provider Sperre Compressors Holdings and systems integration business NetNordic Holding.