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Electra picks up secondaries stakes

This is at least the fourth secondaries deal for the London private equity firm's EP1 Secondary Portfolio which invests from Electra's own capital.

Electra Partners, which manages the portfolio of London-listed Electra Private Equity, has acquired interests in two private equity funds at a discount to net asset value (NAV) as part of its secondaries platform.

The private equity firm acquired the stakes for £7 million ($10 million; €9 million), according to a statement.

“These latest secondary fund purchases show how we are continuing to make use of our flexible investment strategy to deploy Electra’s capital in attractive new assets,” Chris Hanna, a partner at Electra who works on the firm’s secondaries portfolio, said in the statement.

The two funds are cash generative and have mature underlying assets.

Electra has invested about £94 million in secondaries through its EP1 Secondary Portfolio which is 60 percent focused on the US and 70 percent aimed at buyout funds. The portfolio is managed by Hanna and Tom Sternhouse and invests out of Electra’s own capital.

EP1 currently holds nine positions in funds representing about 1,100 underlying private equity funds across various geographies, strategies and vintages. The portfolio purchased five secondaries stakes in 2012, two in 2013 and two in 2014, according to its website.

EP1 has a 1.6x return multiple and has distributed more than 80 percent of cost in cash to the firm, according to the statement.

In January, Electra announced it had appointed Alex Fortescue to take over as managing partner from Hugh Mumford, with Bill Priestley succeeding Fortescue as chief investment partner.

Electra Partners had over £1.8 billion in assets under management as of 30 September, according to the statement. The firm focuses on buyouts and co-investments as well as secondaries and debt.