Goldman backs DH Private Equity restructuring – exclusive

This is the second GP-led process carried out on Doughty Hanson IV, the first of which HarbourVest Partners backed in 2015.

Goldman Sachs Asset Management has led a group of buyers backing the restructuring of a UK-managed pre-crisis fund, Secondaries Investor has learned.

Investors in DH Private Equity Partners‘ 2004-vintage Doughty Hanson IV fund were given the option to sell their stakes or remain in the fund, according to two sources familiar with the matter. It is unclear how many chose to sell.

There are at least two other buyers in the group, according to the two sources. The identity of those buyers is unclear.

Park Hill advised on the process, Secondaries Investor understands.

Goldman is familiar with asset-level deals involving UK buyout funds. In January the firm backed a deal in which London-headquartered Hutton Collins sold half the portfolio of its 2009-vintage fund to Three Hills Capital Partners, as Secondaries Investor reported. One year prior, Goldman teamed with Arcano Asset Management to restructure Duke Street’s 2006-vintage fund.

Doughty Hanson IV, a €1.5 billion Europe-focused buyout fund, has two remaining assets according to DH Private Equity’s website. These are concrete products manufacturer KP1 and producer of air fresheners and insecticides Zobele Group.

Investors in Fund IV include Ilmarinen Mutual Pension Insurance Company, Michigan Department of Treasury and South Dakota Retirement System, according to PEI data.

This is not the first GP-led process that Fund IV has undergone. In 2015 DH Private Equity, then known as Doughty Hanson, carried out a tender offer on Fund IV and its €3 billion, 2007-vintage Fund V. HarbourVest Partners backed the deal and made a €65 million stapled commitment to the firm’s sixth fund, which launched in 2013 seeking €2 billion, as Secondaries Investor reported.

Fundraising for that vehicle was pulled in 2015, partly due to uncertainty following the death of co-founder Nigel Doughty in 2012. The firm revived plans to raise a successor fund seeking €1 billion in May last year, sister publication Private Equity International reported at the time.

GP-led transactions contributed approximately $16.1 billion of an estimated $46 billion of private equity secondaries deal volume last year, according to the UBS 2018 Secondary Market Survey and Outlook.

Goldman Sachs and DH Private Equity Partners declined to comment. Park Hill did not return a request for comment.

– Adam Le contributed to this report.