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Evercore runs single-asset process on BC Partners’ 2011-vintage fund

The chairman of BC Partners' investment committee had previously said that single-asset deals and cross fund transactions were 'not worth the headache'.

Evercore has emerged as the advisory firm working with BC Partners on its GP-led secondaries process as the market for single-asset deals heats up.

London-headquartered BC Partners, Europe’s ninth-largest private equity firm according to the PEI 300, is exploring options to move academic publishing giant Springer Nature into a continuation vehicle, according to two sources familiar with the matter.

Springer Nature is held in BC Partners’ 2011-vintage BC European Capital IX fund, which raised €6.69 billion, according to Private Equity International data. Investors that have committed to Fund IX, either on a primary or secondary basis, include Aberdeen Standard Investments, Ardian and California State Teachers’ Retirement System, PEI data show.

The Financial Times first reported that BC Partners was exploring options to hold on to the asset.

The deal could value Springer Nature, one of the world’s biggest academic publishers by revenue, at around €6 billion.

“It’s a very resilient company with strong cash generation and an ideal fit for a continuation fund,” said a source familiar with the transaction.

BC Partners has tapped the secondaries market before. In 2017 it hired Campbell Lutyens to run a stapled deal on Fund IX to help it hit the €7 billion target of its BC European Capital X fund, as Secondaries Investor reported. That deal closed with Lexington Partners acquiring around €700 million worth of LPs’ stakes at a 14 percent premium to the 31 March 2017 net asset value and committing around €300 million to Fund X.

The firm appears to have done an about-turn on single-asset restructurings. In October last year, Jean-Baptiste Wautier, chairman of BC Partners’ investment committee, told Secondaries Investor that single-asset restructurings came with so many potential conflicts of interest, they were not worth undertaking.

“On paper it looks like a good idea and we did consider it,” Wautier said, referring to both single-asset deals and cross fund sales. “But when you start implementing it, it’s not worth the headache.”

He added that finding a market price at which the GP is happy to be both a seller and buyer throws up complications, including conflicts of interest, while running a bid process and ultimately not selling the asset can also affect a GP’s reputation in the market as a serious seller.

GP-led secondaries deals involving sole assets accounted for 30 percent of asset-level deals in the first half of this year, up from 20 percent in the same period last year, according to Evercore’s H1 2020 Secondary Market report.

A spokeswoman for BC Partners did not return a request for comment. Evercore declined to comment.