News & Analysis

Audax plots secondaries build-out

Last year, the Boston mid-market GP carried out a $1.7bn process on its 2012-vintage fund, backed by AlpInvest, Lexington and Hamilton Lane.

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A private equity firm that executed one of the largest GP-led deals of recent years is looking to enter the secondaries market as a buyer.

Audax Private Equity has hired an executive search firm to find candidates to lead the build-out of a platform focused on GP-led deals, according to three sources familiar with the matter.

The search has been ongoing since last month, Secondaries Investor understands.

Audax Private Equity is part of Audax Group, which also includes a private debt business. It is not clear if the proposed secondaries platform will invest in both asset classes.

Founded in 1999, Boston-headquartered Audax is a mid-market GP focused on business services, consumer, healthcare, industrial services, software and financial services. It has around $9 billion in private equity assets under management out of a group-wide total of $27 billion, according to its website.

Audax employs a buy-and-build strategy and in August made its 1,000th add-on acquisition.

In January, the firm closed a deal that involved multiple assets held by 2012-vintage Audax Private Equity Fund IV being moved into a continuation fund worth $1.7 billion, Secondaries Investor reported. AlpInvest Partners, Lexington Partners and Hamilton Lane led the process, advised by Evercore.

It was the 10th-largest continuation fund ever raised, according to Secondaries Investor‘s map of continuation fund deals.

The 2018-vintage Audax Private Equity Fund VI raised $3.5 billion, against a target of $3 billion, according to PEI data. A follow-up fund has been formed, according to a lobbyist registration form filed with the Los Angeles City Ethics Commission in January 2021.

A handful of new entrants have entered the secondaries market in recent years, though few of Audax’s size.

At the start of the year, Blackrock held a $2 billion final close on its debut fund, managed by a team that spun out of Goldman Sachs Asset Management in 2018. TPG is targeting as much as $2 billion for its debut vehicle focused on GP-led deals, affiliate title Buyouts reported in December.

Audax did not reply to requests for comment.

Chris Witkowsky contributed to this report