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Canadian pension CDPQ shops $1.7 bln PE portfolio

  • Why this is important: CDPQ has been moving toward direct investing
  • Traditional LP stake sales leads secondary volume
  • Total secondary volume estimated $48 bln in 2017
  • Contact CDPQ: info@cdpq.com or +1 514 842-3261

Caisse de Depot et placement du Quebec is selling a portfolio of private equity fund stakes valued at about $1.7 billion, sources told Buyouts.

Greenhill Cogent is adviser on the transaction, sources said. The offering is relatively fresh on the market, sources said.

Caisse did not respond to requests for comment, and a spokesman for Greenhill Cogent declined comment.

Caisse is becoming more of a direct investor, closing on more than C$7.6 billion (US$5.82 billion) in deals in 2017, Buyouts has reported.

The system’s PE portfolio finished last year with C$37.3 billion in assets, roughly two-thirds consisting of direct investments, Buyouts reported.

While much of the talk in the secondaries market centers on GP-led secondaries like restructurings, activity volume continues to be led by traditional sales of LP interests in funds.

Several U.S. public pensions are in the market or considering selling portfolios of fund stakes.

Those include Maryland State Retirement and Pension System; Florida State Board of Administration; Los Angeles County Employees Retirement Association; Teachers Retirement System of Illinois; Pennsylvania State Employees’ Retirement System and Colorado Public Employees’ Retirement Association.

Public pensions and sovereign-wealth funds represented the largest percentage of sellers on the secondary market in the first half, about 20 percent, down from about 24 percent last year, Greenhill Cogent’s first-half secondary volume report shows.

Total market volume last year reached an estimated $48 billion, up from $34 billion in 2016, according to intermediary Campbell Lutyens in its volume report.

About 68 percent of total transaction volume was LP-led deals or traditional LP sales of fund stakes, including funds of funds, Campbell Lutyens said.

Action Item: Read Campbell Lutyens’s volume report here: https://bit.ly/2x2LwXC