ICG expects 2018 launch for next secondaries fund

The firm's latest secondaries fund, the $1.1bn Strategic Secondaries II, was 50% invested as of the end of September.

Intermediate Capital Group is likely to return to the market next year with its latest secondaries fund, according to the asset manager’s half-yearly results.

Its Strategic Secondaries II fund is investing “ahead of its linear investment pace”, the results note, which means a follow-up fund can be expected “during the next 12 months”.

The fund, which focuses on end-of-life restructurings, was 50 percent invested as of the end of September through six assets acquired through three deals.

ICG’s secondaries business raised £9.6 million ($12.6 million; €10.7 million) in fees in the first half of the year, an 88 percent increase on the same period last year, in line with the close of Fund II and fees derived from its investments.

Hawkins: leads secondaries unit

Returns expectations for the firm’s secondaries fund, as a percentage of the whole, are listed in the 15-20 percent range. Secondaries accounted for 9 percent of total returns, the results note.

Strategic Secondaries II held its final close in April on $1.1 billion, above its $1 billion target, according to PEI data. The total included a $200 million commitment from ICG’s balance sheet, the results note.

Its investments so far include the restructuring of EdgeStone Capital Equity Fund II and EdgeStone Capital Equity Fund III, buyout funds managed by Toronto-based EdgeStone Capital PartnersSecondaries Investor reported in April.

Strategic Secondaries II Fund has a 1.15 percent target management fee on committed capital, according to a March presentation on the firm’s website.

The London-listed firm manages €27.2 billion of assets in third-party funds and proprietary capital, principally in closed-end funds. It launched its secondaries platform at the end of 2014 by hiring a specialist team from NewGlobe Capital, including its founder Andrew Hawkins who leads the unit.