BEX completes management buyout in wake of founder’s passing

The firm is gearing up to launch its next fund and could target $1bn, Secondaries Investor understands.

BEX Capital has completed a succession process almost a year after its founder and managing partner passed away due to illness.

Four of the Nice-headquartered secondaries firm’s partners now own 100 percent of the firm’s management company after a management buyout in which they acquired late founder and chief investment officer Benjamin Revillon’s share, held by his estate.

“We want to pursue what has been started by Benjamin and to continue the legacy,” Youssef Kameche, a partner at the firm, told Secondaries Investor.

The firm chose an MBO, as opposed to taking equity capital from a GP stakes buyer, for example, as it allows BEX to remain independent – something integral to its strategy of acquiring stakes in funds of funds and secondaries funds, the managers of which may typically view other secondaries buyers as competitors.

“The core of our strategy is to be independent and not to compete with all the secondaries funds and funds of funds, to be able to transfer those funds without conflicts of interest,” said partner Thomas Carbonel.

Revillon passed away last May after struggling with illness in the prior few years. He founded the firm in 2010 to initially acquire small stakes in high-quality and well-known funds, and soon after discovered the barriers to entry were a little too low and that this part of the market was crowded, he told Secondaries Investor in a 2018 interview.

The firm then pivoted to buying stakes in funds of funds and secondaries funds themselves, in a strategy Revillon referred to as going back to the “original rulebook” of secondaries.

Kameche, Carbonel, Alexis Ferrer and Stephane Chevrier are the four partners now leading the firm, along with partner Erwin Roex.

The firm’s latest fund, the $765 million BEX Fund IV, is now 76 percent deployed, according to Carbonel. Roex, who joined the firm in 2016 and who was previously a partner at Coller Capital, will stay on for the investment period of the next fund, after which he will transition to a senior adviser role, Carbonel said.

BEX’s next fund will seek more than the amount raised by Fund IV and it could even aim to raise around $1 billion by the middle of this year, Secondaries Investor understands.

Carbonel and Kameche declined to comment on any fundraising plans, as well as on the firm’s valuation determined via the MBO process.

Campbell Lutyens advised on the MBO, with Paul Hastings acting as legal adviser.

The firm has 15 staff and has had no departures since Revillon’s passing, according to Carbonel.

BEX’s strategy aims to deliver a 20 percent internal rate of return and 2x money multiple, it is understood.

Carbonel and Kameche described BEX’s strategy as a low-risk and diversified product with shorter investment periods and in a market with less competition. The firm can acquire stakes at a 40 percent discount to net asset value, they said.

“There’s less competition and we can push for our terms as well, with deferred payments and with potential earn-outs,” Carbonel said. “That’s the beauty of our market. We’re in the last part of the private equity market that remains illiquid.”