Tail-end funds surviving up to 20 years

Discussion at the 17th annual King & Wood Mallesons SJ Berwin private equity briefing reveals surprise over the longevity of private funds.

Private equity tail-end funds have an average longevity of 14 years and six months, and have been seen to have a maximum longevity of 20 years, according to private research discussed at a Chatham House rules briefing in London on Wednesday.

The research was carried out as part of a major general partner’s investigation into the types of tail-end funds it was seeing in the secondaries market, although the identity of the GP was not revealed as part of reporting restrictions agreed at the meeting.

King & Wood Mallesons SJ Berwin hosted the briefing at its London offices, its 17th annual briefing, with 180 representatives from over 50 different GPs in attendance.

In March, fund of funds manager Pantheon told Secondaries Investor that there are 200 decade-old funds with an aggregate of $70.5 billion in net asset value (NAV). The firm said the $70.5 billion figure spans buyout, venture, mezzanine and distressed debt funds, growing to $86 billion across 870 funds 10 years or older, if fund sizes were included below $100 million.

Last November, King & Wood Mallesons (KWM) and SJ Berwin (SJB) merged to become one of the biggest 25 global law firms.

Affiliate title Private Equity International awarded KWMSJB Law Firm of the Year in Europe for its fund formation work in the PEI Awards 2013.