Evercore: distressed sellers 1% of 2013 market volume

Demonstrating how much the secondaries market has changed, last year only 1% of activity was originated by distressed sellers, according to advisory firm Evercore.

Distressed sellers accounted for 1 percent of secondaries transactions in 2013, according to global advisory firm Evercore.

The advisory firm put the total market volume at $26 billion, making distressed sellers responsible for $260 million worth of secondaries sales. That’s a big change from how the market began years ago, originally fuelled by distressed sellers.

According to a report released by Evercore, the most common reason for sale in 2013 was regulatory pressure, at 35 percent, representing $9.1 billion of sales.

Exit of non-core assets and active portfolio management accounted for 29 percent ($7.54 billion) and 27 percent ($7.02 billion) respectively, while GP restructuring made up 8 percent ($2.08 billion).

Evercore split the sellers in 2013 into types; financial institutions made up a clear majority with 45 percent, followed by pension plans with 20 percent. The participants included:

  • Financial institutions: 45 percent ($11.7 billion)
  • Pension plans: 20 percent ($5.2 billion)
  • GP restructuring: 8 percent ($2.08 billion)
  • Family offices: 6 percent ($1.56 billion)
  • Sovereign wealth funds: 5 percent ($1.3 billion)
  • Endowments: 4 percent ($1.04 billion)
  • Corporate: 3 percent ($780 million)
  • Fund of funds: 3 percent ($780 million)
  • Other: 6 percent ($1.56 billion)

In July 2013, New York-based Evercore Partners set up a secondaries business with the recruitment of two ex-UBS secondaries specialists, Nigel Dawn and Nicolas Lanel, Private Equity International reported at the time.

In March this year, Secondaries Investor reported that Evercore were at the centre of a deal that saw Ardian pick up a $ 1 billion portfolio of 350 fund assets from US heavyweight GE.

Evercore was founded in 1996 and manages more than $13 billion in assets, according to a statement.

[hr] extra reporting by James Regan