Pantheon backs Oaktree single-asset restructuring

Ports America, the US's largest terminal operator and stevedore, was moved into a separate vehicle through a Campbell Lutyens-advised process.

Pantheon has backed a single-asset restructuring involving an infrastructure asset managed by Oaktree Capital Management.

The London-headquartered firm led a group of investors that provided capital to move Ports America – the sole remaining asset in Oaktree’s $3.5 billion Highstar Capital Fund III – into a separate vehicle, according to a statement from Campbell Lutyens, which advised on the deal.

“This was a complex secondary transaction that proved to be a creative way to meet the varied objectives of Oaktree’s investors, and represents another milestone in the evolution of the secondary market,” Gerald Cooper, a partner at Campbell Lutyens, said in the statement.

Pricing details were not disclosed.

Pantheon and five additional buyers acquired around $650 million-worth of net asset value, with existing LPs in Highstar III electing to roll around $650 million-worth of NAV into the continuation vehicle, according to a source familiar with the transaction.

The deal priced at a high single-digit discount to NAV, it is understood.

The process was an auction and existing LPs in Highstar III were given the option to sell their stakes, according to the statement. The buyers also committed follow-on capital for add-on acquisitions and strategic investments in Ports America, the statement noted.

It is unclear whether LPs were given a status quo option.

Highstar III closed in 2007 and was acquired by Oaktree via the Los Angeles-headquartered firm’s purchase of infrastructure fund manager Highstar Capital in 2014.

Ports America is the largest terminal operator and stevedore in the US, operating in more than 42 ports and 80 locations, according to its website.

Sister publication Buyouts reported in June that Pantheon was set to back the deal.

Pantheon is seeking $2 billion for its Pantheon Global Secondary Fund VI, according to Secondaries Investor data. The firm ranked eighth in the SI 30 list of the biggest secondaries fundraisers, having collected $9.4 billion between January 2014 and June 2019.

There was a “marked increase” in single-asset deals in the first half of this year, according to advisor Greenhill’s mid-year report. “While several large transactions remain in process, we expect that this transaction type will represent a sizeable share of GP-led volume in 2019,” the firm noted. It did not give deal volume figures related to single-asset processes.