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BlackRock banks $3bn for first dedicated secondary strategy Thursday, April 01, 2021
Laxman Pai, Opalesque Asia:
The world s largest asset manager BlackRock Inc. has raised $3 billion to invest in the private equity secondary market to expand its presence in illiquid alternative investments.
The capital raised by BlackRock Private Equity Partners included $2.4 billion for its debut Secondaries and Liquidity Solutions Fund, which exceeded an initial target of $1.5 billion. The Fund is among the largest debut funds ever raised to buy secondhand private equity stakes.
According to WSJ, secondary funds have been one of the fastest-growing parts of the private-equity industry over the past year, with investor demand surging even after the pandemic hit.
Outlook 2021: Multiple concerns ahead for PE investing
With both the volume and value of private equity deals in 2020 having dropped, many investors believe Covid-19 will affect the industry more severely than the 2008 financial crisis.
Private equity investors believe mounting geopolitical tensions and the ongoing fallout from the Covid-19 pandemic 2021 could cause private equity deal losses and more distressed transactions. But they anticipate Asia Pacific economies and investment opportunities rebounding faster than other parts of the world, with China and India looking like particularly appealing investment opportunities.
Source: Dechert
According to a December 2 report by US-headquartered law firm Dechert, the total number (2,260) and volume ($382.7 billion) of global buyout deals for the first three quarters of this year dropped 21% and 12% year on year, respectively.