Amy Carroll
LPs are turning to the secondaries market to address liquidity constraints amid improved pricing, as compelling supply/demand dynamics and structural innovations help fuel LP-led dealflow.
Despite a record year for fundraising, growth in the secondaries market has been hampered by a lack of liquid capital.
Money continues to flow into what many say is the most undercapitalised corner of private markets.
If they are not addressed appropriately, legal complexities such as tax issues can knock a deal off track.
Even with the best laid plans, GP-led processes can become delayed, but there are steps sponsors can take to mitigate common holdups.
Sponsors and management teams need to demonstrate their commitment to the next phase of growth.
Sponsors and management teams need to demonstrate their commitment to the next phase of growth.
A collaborative approach is key to helping de-risk transactions and develop long-term relationships.
Early engagement and regular communication with LPs are vital to avoiding roadblocks in the GP-led secondaries process.
Muted M&A activity and liquidity demands are prompting more sponsors to consider moving assets into continuation funds, but successfully completing a GP-led deal is more easily said than done.