ICG’s Strategic Equity to back Onex single-asset continuation fund

The new vehicle will house Onex’s stake in global tax services and software provider Ryan, Secondaries Investor has learned.

ICG’s Strategic Equity unit is set to back another sizeable GP-led for an asset held by Canada’s Onex, Secondaries Investor has learned.

The GP-led-focused unit of the London-listed asset manager will back an around $700 million single-asset continuation fund, according to four sources familiar with the matter.

The process has been in the market for less than two months, one of the sources said.

The new vehicle will house Onex’s stake in global tax services and software provider Ryan. Onex initially acquired a 42 percent stake in Ryan in 2018 for $317 million, valuing the company at $1.1 billion, according to a statement at the time. Last year, Ares Management acquired a significant minority interest valuing Ryan at $2.5 billion, with Onex’s flagship private equity platform also retaining a significant minority interest, according to a statement.

Jefferies is understood to be advising on the process, according to three of the sources.

Onex did not respond to a request for comment by press time. Both ICG and Jefferies declined to comment.

ICG Strategic Equity is targeting $6 billion for its latest GP-led focused flagship ICG Strategic Equity Fund V, according to Secondaries Investor data. The raise comes on the heels of the close of its predecessor with the group closing on $5.3 billion for Strategic Equity IV last year, which beat its $5 billion target.

ICG’s chief investment officer and chief executive Benoît Durteste said on its Q3 earnings call that Fund V “finds itself in a sweet spot of the market, with very significant supply-demand imbalance”.

Explaining its strategy, global head of ICG Strategic Equity Ricardo Lombardi previously told Secondaries Investor “from day one, our plan has been to build the category killer for GP-leds, and to do that we knew we had to build a team with buyout backgrounds, and have a fit-for-purpose mandate from our LPs”.

“The model is very simple,” he added. “Is it a quality asset in a quality industry? Is the valuation attractive and is the GP strong and truly aligned? Quality asset in a quality industry and an attractive valuation, plus a strong and aligned GP – if you don’t have all those things, move on.”

Onex has recently pressed pause on capital raising for its own sixth flagship buyout offering, affiliate title Buyouts reported in May.

“We have made the tough but strategic decision to pause fundraising for Onex Partners VI,” chief executive Bobby Le Blanc said in a first-quarter earnings call. “This will allow us,” he said, “to focus on generating strong operating company value and realizations” within Onex Partners V and the portfolio “until we resume fundraising”.

The firm intends to continue investing, “leveraging the remaining capital in OPV, co-investment opportunities with LPs and Onex’s balance sheet”, he added.

Onex Partners V closed in 2017 on $7.15 billion, ahead of a $6.5 billion target.