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North America-Based Investors Open to Selling Private Equity Interests on the Secondary Market

by Andrew White

  • 23 Feb 2015
  • PE

Preqin’s Secondary Market Monitor currently tracks 292 private equity investors that have an interest in selling private equity fund stakes on the secondary market. Of these, 130 are headquartered in the US and Canada and comprise a variety of investor types, including private equity fund of funds managers (18%), endowment plans (16%), public pension funds (15%) and foundations (10%). These investors have aggregate assets under management (AUM) of $6.3tn.

JPMorgan Chase is the largest US-based investor with an interest in selling private equity fund stakes on the secondary market, with AUM of $2.4tn, $8bn of which is currently allocated to private equity. The bank has previously sold both single fund interests and portfolios of fund interests on the secondary market. Its private equity portfolio primarily consists of fund interests in buyout and venture capital vehicles, though it also has exposure to other fund types, including growth vehicles. It has a strong preference for US-focused funds but also seeks opportunities on a global scale. 

The second largest US-based investor interested in selling private equity fund stakes on the secondary market is Teachers Insurance and Annuity Association - College Retirement Equities Fund (TIAA-CREF). The private sector pension fund has assets under management of $564bn and currently allocates $1.3bn to private equity. TIAA-CREF’s private equity portfolio contains a range of fund types, including buyout, distressed debt and venture capital vehicles. It primarily targets funds focused on North America but also holds interests in Europe-focused vehicles. 

MetLife Insurance Company is the third largest US-based private equity investor with an interest in selling private equity fund stakes on the secondary market. It currently allocates $7.7bn of its $510bn total AUM to private equity. The insurance company is an opportunistic seller on the secondary market and will consider selling private equity interests if approached with attractive offers. Its private equity portfolio is primarily made up of North America-focused buyout vehicles, although it also has exposure to a number of other global-focused fund types. 

The largest Canada-based private equity investor interested in selling private equity fund interests is CPP Investment Board. The public pension fund has total AUM of $217bn, and currently allocates 15.8% ($34bn) to private equity. CPP Investment Board is an opportunistic seller on the secondary market and sells from a portfolio that is chiefly comprised of North America-focused buyout fund interests. Its investment portfolio also features interests in a range of other fund types with broader geographical scopes.

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