Europe’s Most Influential PE Fund Managers

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September 13, 2012

This week Europe’s largest and most influential investors were identified by PEN using a mix of data from Preqin and more subjective input such as recommendations and opinion from private equity firm executives and intermediaries that specialize in fundraising. It is the fifth annual survey, according to Financial News.

 

Influential investors are those who are able to write “big tickets” and commit to funds as cornerstone investors. If one of these investors has invested in a fund, for example, then other smaller ones tend will follow, says PEN.

 

Since fundraising is difficult these days for buyout and PE fund managers (general partners), such institutional investors are even more important and influential, the report said. These big name investors in the ranking apparently have little difficulty raising pools of capital themselves, according to the study.

 

Several Swiss fund managers made the top rankings, including Partners Group (1), Capital Dynamics (6) Adveq (20) and Pictet (17). The asset manager of Swiss bank UBS mainly manages the money of high-net-worth clients and it climbed the ranking to spot 12 this year because its clients are growing allocations to the PE asset class.

 

Yet another Swiss fund manager is LGT Capital (5) has increased its allocation to PE by EUR 1.7 billion over the past year, according to the report, which also said that LGT is known for its ability to influence terms and trends, as well as getting high marks for its communication skills.

 

New names that have entered the rankings over the past five years include Axa Private Equity, which has increased its allocation by EUR 4.3 billion over the past three years, was ranked in 15th place in 2009 and is now number 4.

 

Another up and comer is Access Capital Partners, which only entered the list last year and is now number 10. Access Capital Partners has expanded beyond its native France through acquisitions of most of the private equity operations of Finnish bank Pohjola.

 

Not all the fund managers are independent companies. For example, Luxembourg-based European Investment Fund is backed by the European Investment Bank. It has over the years become a name to reckon with, particularly for small and medium-sized enterprise-focused funds. EIF said to be influential in negotiating wording in limited partner agreements.

 

An interesting note was found elsewhere about fund of funds and their possible allocation activity for the coming year. The latest Triago Quarterly report says these fund managers have about USD 12.5 billion in “dry powder”,  capital raised in 2007 and 2008 that has yet to be invested.

 

Triago’s experts say that they believe that “the bulk of that money” will go to secondaries. “Given the goal of investing unspent capital before standard 5-year commitment periods end, and the importance of cashing out LPs within the standard 10- year fund-of-funds life cycle, it is reasonable to assume that two-thirds of this money, or $8 billion, will be spent in the private equity secondary market by the end of 2013”.

 

The main reason the asset class is attractive, says Triago, is that “due diligence is easier than with blind pools and duration is shorter”.

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