Lexington nears $20bn finish line for largest-ever flagship

The firm expects to hold the final close on Lexington Capital Partners X at the end of the year.

Lexington Partners is set to wrap up fundraising for its 10th flagship secondaries vehicle in what would be the second largest ever vehicle for the strategy.

The New York-headquartered firm has a hard-cap of $20 billion for Lexington Capital Partners X and is expecting to hold the final close on this figure by the end of the year, according to two sources with knowledge of fundraising. It had raised more than $18 billion as of July, surpassing its $15 billion target, Secondaries Investor data shows.

Lexington held the final close on $14 billion for predecessor fund LCP IX in 2020.

LCP X is the first vintage in which the firm is understood to have focused on raising capital from the private wealth market, according to one of the sources. Between 12 and 15 percent of capital gathered thus far for Fund X came from non-institutional investors – a significant increase from its predecessor funds.

Part of the reason behind this is Lexington’s acquisition in September 2021 by asset manager Franklin Templeton, part of the latter’s further push into alternatives. That has meant more engagement with some of the largest private banks, wire houses, independent broker dealers and RIAs, Secondaries Investor understands.

Franklin Templeton paid $1.75 billion for a 100 percent stake in the secondaries firm, comprising $1 billion at the deal’s close and $750 million over the following three years, according to a statement at the time. The management team of Lexington has remained in place post-acquisition.

LP commitments for Fund X include $600 million from Cathay Life Insurance, $100 million each from Minnesota State Board of Investment and Fubon Life Insurance, as well as $90 million from New York City Police Pension Fund, according to Secondaries Investor data.

The current largest secondaries fund is Strategic PartnersFund IX which closed on $22.2 billion in January.

Lexington is the fourth largest secondaries firm in this year’s Secondaries Investor 50 ranking.

A spokesperson for Lexington declined to comment.

– Alex Lynn contributed to this report.