Morgan Stanley raises $770m for secondaries

Morgan Stanley Alternative Investment Partners’ Global Secondary Opportunities Fund II closed on $770 million, according to a statement from the financial services firm.

The fund exceeded its $600 million target last year, Private Equity International previously reported.

Fund II focuses on off-market secondary opportunities and emphasises small- and mid- cap buyouts and special situations funds, the statement read. Diversification from managers, regions, vintage years and portfolio companies is preferred and investors include Alternative Investment Partners’ clients and new LPs.

“We believe substantial opportunities continue to exist in areas of the market where we focus and that our solutions-based approach to secondary investing will remain attractive to both sellers and general partners through all phases of the economic cycle,” said Jon Costello, the team’s senior portfolio manager, in the statement.

Fund I, a 2009 vintage, raised $585 million, according to the statement. The fund became fully invested last year. Before raising its debut fund, Morgan Stanley’s alternative investments group had bought fund interests using capital from its global private equity fund of funds, PEI previously wrote.

The fund of funds manager has $17 billion of assets under management, as of 4 December, according to PEI’s research and analytics division. Morgan Stanley’s Alternative Investment Partners allocates Just under $1 billion to private equity. Its first private equity investment was 1994, according to the data.

Hamilton Lane and RCP Advisors have also been raising secondary funds this year. In June, Hamilton Lane surpassed its $650 million target and reported it had raised $728.4 million for its third secondaries vehicle, PEI reported. The fund is edging toward its $900 million hard-cap. RCP’s second secondaries fund is slightly smaller—it had set a $425 million hard-cap. RCP had raised about $367 million for the fund as of 5 June, PEI wrote.