SL Capital hits final close on SOF III

The firm's niche secondaries fund has closed above its $400m target after 16 months of fundraising.

SL Capital Partners’ latest dedicated secondaries fund has hit final close on $428 million, according to a statement.

SL Capital Secondary Opportunities Fund III has a $400 million target, according to PEI data, and will focus on niche areas of the market including stakes in funds of funds and secondaries funds.

The geographical split of investors is approximately 60 percent UK and 40 percent North America, from public and corporate pension schemes, multi-family offices and high-net-worth individuals, according to the firm.

Secondaries Investor revealed in June that the Edinburgh-headquartered firm was aiming for a final close in the fourth quarter of this year.

SOF III launched in April 2016 and held first close in October of that year on $213 million. Investors include Cumbria Local Government Pension Scheme, with a commitment of $25 million, and San Bernardino County Employees’ Retirement Association, also with $25 million, according to PEI data.

The fund is expected to generate a net internal rate of return of 17 percent, according to an investment due diligence report by NEPC Investment Consulting presented to SBCERA.

The fund charges 10 percent carried interest and has a 10 percent hurdle rate. SOF I and II had higher hurdle rates of 14 percent and 12 percent respectively, according to the document.

SOF II closed in May 2015 on $291 million, above its target of $200 million, after less than a year of fundraising. It was around three-quarters deployed as of June, Secondaries Investor reported at the time.

According to PEI data, 21 secondaries funds have closed so far in 2017 worth a combined $28 billion.

SL Capital declined to comment.