Axiom Asia ups secondaries allocation as it closes FoF IV

The fund of funds manager will increase the vehicle's secondaries and co-investment allocation to more than 20%.

Axiom Asia Private Capital, a Singapore-headquartered investment firm, has held a final close on its fourth fund of funds on a little over $1 billion and expects to target more secondaries deals than it did from the predecessor fund.

The manager began fundraising for Axiom Asia IV in November 2015 with a $750 million target and garnered strong support from its existing investors, the firm said in a statement.

“We had a strong re-up rate and are very grateful for the support from our existing and new investors,” said Edmond Ng, a managing partner with Axiom Asia.

Managing partner Marc Lau told sister publication Private Equity International: “One of the reasons why we’ve had a high re-up rate is that we’ve shown we are a true extension of our LPs’ team on the ground in Asia. They see the value in both the service and intelligence that we provide, and at the same time we provide them a good return that’s above the public market benchmarks.”

Limited partners in Axiom Asia IV include the Montana Board of Investments, the Michigan Department of Treasury and Caledonia Investments, according to PEI data.

Around half of Fund IV’s portfolio will be in China-related investments, while the remaining half will be spread across India, Japan, Australia, South Korea, and also South-East Asia. Axiom invests in buyout, venture capital, growth capital and secondaries. This is a similar strategy to the previous vehicle, the 2012-vintage $1.15 billion Axiom Asia III.

In the past the firm has made commitments to Hong Kong-based secondaries firm NewQuest Capital Partners, China Everbright Investment Management and CDH Investments, PEI data indicated.

Axiom Asia allocates the lion’s share of its portfolio to private equity funds, while the remaining 20 percent is in secondaries and co-investments.

“For Fund IV, we expect to grow our proportion of secondaries commitments compared with Fund III because the market has grown both in size and sophistication,” managing partner Alex Lee said.

“We’re actually seeing a wide variety of transaction types, from bank spinouts to GP restructurings. But we’ve been most productive buying LP positions in Asian funds that are not the so-called ‘flow names’. We have a deep knowledge of these funds so we can offer competitive pricing than others.”

Ng added the firm has already deployed some capital out of Fund IV, which raised $1.028 billion. He declined to provide details on the investments.

Probitas Partners served as the exclusive placement agent for Axiom Asia IV.