Altius Associates, a London-based private equity advisory firm and fund of funds manager, has been acquired by US investment services firm Pavilion Financial Corporation.
Following completion of the transaction, which is expected during the third quarter of this year, Pavilion will combine Altius, which has offices in London, Singapore and Richmond, Virginia with its own alternative asset advisory subsidiary, LP Capital Advisors, which is headquartered in Sacramento, California. Pavilion acquired LP Capital in 2014.
This is Pavilion’s fifth acquisition since 2010, and is “consistent with our strategy of assembling various expert and specialised teams to bring top quality investment advisory services and solutions to our clients”, Pavilion president Daniel Friedman said in the statement.
The combined group will offer consulting services and solutions across private equity, private credit, real assets and hedge funds.
“Both Pavilion and Altius were set up to do very similar things as it relates to the creation of a global advisory platform for alternative asset classes,” Friedman told sister publication Private Equity International. “When we were introduced it became very apparent that the fit and the alignment of objectives just made a lot of sense.”
Once the transaction completes the combined organisation will be rebranded as Pavilion Alternatives Group, with total alternative assets under advisement of more than $60 billion.
Pavilion Alternatives Group will comprise around 70 professionals located in London, Singapore, and Sacramento, Richmond, Boston, Salt Lake City and Montreal.
All senior management from Altius and LPCA will remain in leadership positions in the newly-created Pavilion Alternatives Group, which is employee-owned.
Brad Young, co-chief executive at Altius in Richmond, told PEI that the firm decided to partner with Pavilion for several reasons.
“It’s a very similar company in terms of [being] employee shareholder-owned. It has a very similar client focus, and it gave the opportunity for Altius to continue to build the organisation under the Pavilion Alternatives Group name and continue to offer excellent services to our existing clients and continue to develop our global client base.”
Young said that Altius has had “a number of conversations over the years” about partnerships, but that the tie up with Pavilion was the best outcome for its stakeholders.
“The private equity landscape certainly has shifted and changed over the years and we thought that partnering with somebody like Pavilion would help us better be able to achieve the goals that we had set,” Young said.
“Certainly you’re seeing larger-scale firms and global firms become apparent, and they’re able to offer more services and attract and retain talent, and so there are a lot of advantages to that.”
Following the completion of the transaction, Pavilion Alternative Group’s goal is to “continue growing”, Friedman said.
“I’m not sure we will do another acquisition, although we might in the event that there’s a very interesting niche or specialised service that we can further add to the alternatives group. But definitely in terms of hiring and growing, as our business is growing we will want to continue expanding both our skillsets and the group of people servicing clients.”
Read our guest commentary by Altius partner Chason Beggerow on whether to be a buyer or seller in the secondaries market here.