Secondary Market Intermediaries – April 2013

by Patrick Adefuye

  • 11 Apr 2013
  • PE

Secondary market intermediaries play an important role in the secondary market. Particularly on the sell side, they provide an important service to potential sellers in what remains an opaque market. Services provided span from identifying which funds in an investor’s portfolio are most marketable, developing an effective sales strategy, setting price expectation, identifying potential buyers and managing an auction process as well dealing with the administrative processes involved in the transfer of fund interests.

Of the 70 intermediaries profiled by Preqin's Secondary Market Monitor, the majority of these (67%) are placement agents who offer this service as an extension of their role in advising institutional investors. Twenty-three percent are dedicated secondary market intermediaries who focus solely on providing secondary market advisory services. Of the profiled intermediaries, 46% are headquartered in the US, 29% in UK, 9% in France and 7% in Switzerland.

By total value of transactions represented, the largest three intermediaries are Cogent Partners, UBS Investment Bank Private Funds Group and Campbell Lutyens. Cogent Partners has represented over $60bn worth of secondary market transactions. Cogent Partners focuses solely on private equity providing liquidity solutions and other advisory services to a wide range of institutional investors, including advising on the disposal of private equity fund interests. UBS Investment Bank Private Funds Group is a placement agent that that has completed over $31bn worth of secondary market transactions. It has a team of over 20 professionals focused exclusively on private equity secondary market transactions. Placement agent Campbell Lutyens has advised on over £30bn worth of transactions. It only advises on the sell-side in the context of the sale of portfolios of funds or portfolios of direct interests.

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