News & Analysis

Pomona closes on $2.6bn for latest flagship secondaries raise

The New York-headquartered firm surpassed its $2bn target for Pomona Capital X, which is 44% larger than its predecessor.

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Pomona Capital has reached a final close on its 10th flagship fundraise, gathering $2.6 billion.

The New York-headquartered firm surpassed its $2 billion target for Pomona Capital X, a statement said. The fund spent just over two years in market, having launched in 2020, parent company Voya Financial noted in an earnings call in May of that year.

The fund is 44 percent larger than its predecessor, which closed on $1.75 billion in 2018. The vehicle took around two-and-a-half years to reach final close, Secondaries Investor data shows.

Investors committed to the fund include Chicago Firemen Annuity & Benefit Fund, Fubon Life Insurance, Oklahoma Firefighters Pension & Retirement System and Tiger Alternative Investors, according to Secondaries Investor data. Alongside re-ups, the fund saw a “significant number of new investors”, Pomona said.

Pomona CEO Michael Granoff said the firm’s strategy “resonates with investors who recognise the long-term attractiveness of private equity but are concerned about risk”, adding that the “modest fund size enables us to be nimble, flexible and creative to source what we believe to be higher-than-market-quality assets at a lower-than-market price”.

Pomona Capital has been making headlines for preferred equity transactions in recent years, including extending two preferred equity tranches worth a combined €160 million to Milan-headquartered buyout shop Aliante Partners in summer 2021.

Pomona’s close comes off the back of a subdued first half for secondaries fundraising compared with a fruitful two years topped by a record $98.8 billion in 2020. Fundraising fell 30 percent year-on-year to $31.2 billion as of end-June, with a total of 32 funds closing, according to data compiled by Secondaries Investor.

Secondaries funds are out chasing $124.7 billion in a tight fundraising environment. LPs are battling with the denominator and numerator effects within their portfolios, as well as a bulging list of managers that are planning to or have come back to market with new funds.