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Deal volume topped $130bn last year, say Jefferies, Greenhill

These figures represent an increase of around 120% YoY, driven by pent up buyer demand and a steady stream of high-quality LP- and GP-led opportunities.

The secondaries market did not just beat the $100 billion mark last year, it flew past it, according to full-year data from two major advisers.

Global secondaries transaction volume was $132 billion in 2021, representing a 120 percent increase over last year and a 50 percent increase on the $88 billion seen in previous record year 2019, according to Jefferies’ Global Secondary Market Review, shared exclusively with Secondaries Investor.

GP-led deals accounted for 52 percent of deals by volume  – the second consecutive year they have outstripped LP portfolio sales – and rose 94 percent compared with 2020, Jefferies concluded. More than 100 GP-led processes came to market in 2021, with continuation funds comprising 84 percent by volume.

The volume of LP portfolio sales increased by 156 percent year-on-year, with 74 percent attributable to repeat sellers, Jefferies noted. More than 20 $1 billion-plus transactions closed last year as limited partners used the secondaries market to de-risk their portfolios and reduce exposure to non-core managers.

“High levels of available capital and pent up buyer demand were matched by a remarkable supply of diversified LP portfolios and high-quality GP-led opportunities,” the adviser noted, adding that a stable macroeconomic backdrop and rising public equities helped drive a record year.

Greenhill registered total secondaries deal volumes of $130 billion last year. The adviser found that LP deals accounted for 53 percent of this figure, almost the reverse of the conclusion reached by Jefferies. Multi- and single-asset continuation vehicles represented 84 of GP-led activity, Greenhill concluded.

“We expect volume to grow albeit more moderately” in 2022, the investment bank noted, as strong fundraising from secondaries buyers and positive deal dynamics are counteracted by potentially increased volatility bought about by monetary policy tightening.

Both advisory firm’s full year deal volume figures are higher than that of M2O’s, which estimated $100 billion traded on the secondaries market last year.

Secondaries Investor will publish a closer look at the findings of Greenhill’s and Jefferies’ reports in the coming week.