LGT, Five Arrows, Cubera back Nordic fund-of-two stapled deal

Two Danish pension funds sold their stakes in the 2010- and 2016-vintage vehicles.

LGT Capital Partners, Rothschild Merchant Banking‘s secondaries unit and Cubera Private Equity have backed a stapled deal by acquiring stakes from two of Denmark’s largest pension funds.

The transaction involved Danish private equity firm VIA Equity‘s 2010-vintage Via Venture Partners Fund II and 2016-vintage Via Venture Partners Fund III as well as commitments to the firm’s latest vehicle which launched last year, according to a statement.

Funds II and III are both DKr 1 billion ($143.8 million; €132.9 million) vehicles, according to PEI data.

Danish pension ATP was the sole LP in Fund II, while both ATP and fellow pension PFA were the only LPs in Fund III, according to VIA’s website.

“[T]ime is up for a strategic change,” said Bo Foged, ATP chief executive, commenting on the reason for the sale. “We want to simplify our organisation and to a larger extent participate in the broader Danish financial ecosystem using the experience we have gathered over the years in future partnerships with other players in Denmark.”

Five Arrows and Cubera acquired ATP’s stake in Fund II, while Five Arrows and LGT acquired ATP’s and PFA’s interests in Fund III, according to the statement.

The value of the total net asset value that FASO and Cubera acquired was around DKr 917 million each, in addition to the primary commitments, according to a source familiar with the transaction. The size of LGT’s participation in the deal is unclear.

The transactions are expected to close in the first or second quarter of this year.

VIA Equity expects to finish fundraising for Fund IV this year, it said.

Stephenson Harwood provided legal advice to FASO, according to a statement.

VIA Equity was founded in 2006 and invests either alone in mainly small and medium-sized companies with revenue from €10 million to €100 million or together with one or both of ATP and PFA in larger deals. Its largest deal to-date was more than €2 billion in enterprise value.

Stapled deals dropped in popularity last year, with 33 percent of GP-led transactions involving stapled primary capital versus 52 percent a year prior, according to Evercore’s YE 2019 Secondary Market report.