Investors are continuing to enter the secondary market even though markets remain volatile and the economic outlook is unclear. One institutional investor that recently reported its intentions to make a secondary market sale is Verizon Investment Management. The asset manager, responsible for the management of the assets of Verizon Communication’s pension plan, is considering exiting a portion of its private equity fund interests on the secondary market. It has enlisted Morgan Stanley to explore the option. Morgan Stanley has already approached a number of secondary buyers for feedback in order to gauge potential interest in the portfolio. The portfolio of interests to be to be sold is estimated to be worth at least USD 1 billion. Verizon Investment Management’s private equity portfolio is known to contain buyout and growth capital funds amongst others, with exposure to a variety of geographies including North America, Europe and emerging regions.
Another asset manager currently considering the possibility of a secondary market sale is Blue Sky Group. The EUR 13 billion Netherlands-based asset manager may consider the option of selling some of its real estate fund stakes on the secondary market within the next year.
Preqin’s Secondary Market Monitor database currently tracks over 280 secondary market sellers, of which 10% are asset managers. Of the asset managers looking to make a secondary market sale, just 4% are looking to do so immediately, a considerable 70% are considering making a sale within the next 12 months and the remaining 26% within the next 12-24 months.