Brazil’s Patria plots dedicated secondaries strategy

Patria Investments, Brazil’s largest private markets firm, is planning a dedicated secondaries strategy, Secondaries Investor has learned.

The firm, which is listed on the NASDAQ, is preparing to formalise and widen its secondaries business, which will initially focus mainly on traditional LP secondaries, according to two sources familiar with the matter.

Details of the strategy are likely to be formalised before the end of the year, one of the sources said.

A spokesperson for Patria declined to comment.

Patria already offers secondaries to its investors alongside funds of funds and co-investments via feeder vehicles to global alternatives managers, Secondaries Investor understands. The firm manages more than $1 billion of Latin American investor capital via such structures, chief corporate development officer Marco D’Ippolito said on the firm’s second quarter earnings call last month.

The firm, which is active across asset classes including private equity, infrastructure, credit, public equities and real estate, has previously considered exploring the formation of listed “continuation-driven” vehicles for businesses it considers champions.

“I can give you amazing examples from our private equity fund, from our infrastructure fund, one or two champions per fund,” chief executive officer Alex Saigh said on an earnings call in 2021. “I would love to continue investing in these companies, given that they continue to deliver 20 percent-plus returns per year.”

Patria would join a list of firms that have added dedicated secondaries investment units in recent years, either by organic growth or by acquisitions. These include CVC Capital Partners, Ares Management, Brookfield Asset Management, TPG and Franklin Templeton, as Secondaries Investor has reported.

The São Paulo-headquartered firm is seeking $3 billion for its latest buyout fund, Patria – Brazilian Private Equity Fund VII, according to PEI data.

Patria was founded in Sao Paulo in 2001 by managing partners Luiz Otavio Reis de Magalhães, Alexandre Saigh and Olímpio Matarazzo Neto. In 2010, Blackstone acquired a 40 percent stake in the firm and fully exited its position last year, following Patria’s 2021 IPO, according to regulatory filings.