Stapled Deals

Access invested in a portfolio of companies managed by N+1 and also invested in its most recent fund, N+1 Private Equity Fund III.

Speaking at a private equity conference in London, Adams Street Partners' Pinal Nicum said there were three elements to executing a successful restructurings deal.

As restructurings and stapled deals become more mainstream, very large funds and Asian funds will provide more deal flow for such transactions, according to speakers at the British Private Equity and Venture Capital Association Summit 2015 in London on Thursday.

Not enough LPs wanted to sell their stakes in two existing funds managed by the Spanish firm, which is also looking to raise at least €400 million for its latest vehicle.

Fund restructurings have entered the mainstream, which means GPs need a better understanding of the legal and compliance risks involved in the strategy, write Gibson Dunn lawyers Candice Choh and Shawn Domzalski.

Stapled deals, such as Palamon's recent transaction involving three of its funds, increased during H1 2015, according to a report by Setter Capital.

Five buyers – Goldman Sachs, Morgan Stanley, Rothschild, Adams Street and PGGM – have committed to two tail-end funds and one new vehicle in a Palamon staple deal.

The secondaries buyers made a stapled transaction, purchasing $109 million-worth of interests in Transportation Resource Partners III and also investing in Transportation Resource Partners IV.

Almost 80% of LPs have taken part in one or more PE fund restructurings since the global financial crisis.