Secondaries have become an increasingly popular strategy for private equity investors, providing a platform for buyers and sellers and enabling access to greater liquidity across the cycle. Now part of clients’ core allocations, secondaries may also provide a lower risk option for investors seeking private equity exposure given they have better visibility on the performance of portfolio companies and can benefit from quicker uplifts in valuations.
Unigestion was an early pioneer in secondaries during the 1990s, recognising the opportunities to be had from acquiring assets from other private equity investors. As such, we have built a long track record of successful secondary investments that have delivered attractive returns to clients.
Our differentiated secondaries strategy, which has limited overlap with peers, seeks to provide investors with exposure to hard-to-access investments. We are experts in complex, tailored liquidity solutions and have long experience in completing LP stake acquisitions, GP-led transactions and other structured deals. Our funds have consistently outperformed private and public benchmarks, delivering compelling risk-adjusted returns.
We source over 600 deals a year through our network of specialist mid-market managers. Supported by our proprietary AI tool PEpper, these are then whittled down to 30-40 going forward to full due diligence and 10-12 approved for investment each year. We insist that returns are driven by growth, not leverage, and aim to deliver unlevered top quartile returns with a loss ratio of less than 1%.
We have a clearly defined investment criteria that is consistently applied across our portfolios:
- Market leaders – high quality and leading assets in sectors with strong tailwinds
- Existing relationships – taking advantage of the Unigestion private equity platform
- Inflection situation – ability for shorter hold, less risk, attractive entry price etc
- Optimised economics – leverage Unigestion platform to reduce total expense ratio
- Proprietary or club deals – utilise platform to originate proprietary deals
- Liquidity profile – deals with the ability to improve the cashflow of the programme