Evercore: secondaries funds target $30bn

Evercore, the global advisory firm, has predicted over $30.2 billion will be raised in 2014, according to its research.

It interviewed 70 market participants excluding sovereign wealth funds, of which 33 buyers indicated they would be raising secondary capital.

In aggregate, the 33 buyers told Evercore that they had plans to raise $30.2 billion of new capital this year, and of the 33 respondents;

–          Seven respondents said they would target real estate

–          Six respondents said they would target early secondaries

–          Six respondents said they would target infrastructure secondaries

–          Two said they would target credit secondaries

Evercore put last year’s dry powder at $45 billion, based on its own estimates and publicly available data.

Nigel Dawn, senior managing director at Evercore, said Evercore had seen a resurgence of complex deals in 2013, which Dawn said didn’t surprise him.

“When there is a significant amount of dry capital raised, and we had $45 billion in dry powder left at the end of last year, with about $30 billion to be raised this year, capital will seek more complex homes,” said Dawn.

“This includes GP restructurings, direct company transactions and transactions involving leverage structures which are harder for new entrants to execute, as you need a certain amount of sophistication: also if a big portfolio is involved, an investor needs information, a database, etc. Those aspects give an inherent advantage to experienced investors in the asset class.”

In July 2013 Evercore got into the secondaries advisory business with a bang, bringing on long-time UBS secondaries veteran Nigel Dawn and former UBS senior secondaries executive Nicolas Lanel to run its newly launched secondaries business.

Last week Secondaries Investor reported that Evercore were at the centre of the deal that saw Ardian pick up a $1 billion portfolio of 350 fund assets from US giant GE.