Coller Capital has closed its fourth fund at $2.5 billion, more than double its target size. This makes Coller International Partners IV the largest fund ever dedicated to buying investment portfolios and investors positions in private equity funds. The secondaries market is currently experiencing a surge in investor interest thanks to the growing pool of primary capital and continuing gloomy market conditions.
The fund was launched at the end of 2001 and by May this year had raised $724 million towards its $1 billion target, twice the size of Coller’s third fund, which closed in 2000. The new fund will follow the investment strategy of former funds, although with the investment period extended from two or three years to five years. It will acquire interests globally and no boundaries have been set in terms of deal size. Jeremy Coller, CEO of Coller Capital, said: “With our capital, investment experience, entrepreneurial spirit, and multinational team, we will continue to implement our strategy of being a one-stop shop for the $1 billion plus portfolios down to the many $1 million positions.”
Repeat investors include CalPERS and State of Michigan (both committing $100 million), General Motors and Barings, Coller’s original sponsor, which launched a $20 million feeder fund to invest directly into Coller International Partners IV. Among the 150 investors that have made commitments are new investors Canadian Pension Plan and Barclays Pension Fund, committing $75 million and $42 million, respectively. Nine US state pension funds, four sovereign investment authorities and six universities have also invested. Of the commitments, 47 per cent came from North America and 38 per cent from Europe.
Coller Capital, established in 1990, now manages funds in excess of $3.5 billion. The team of 19 investment professionals continues to expand as the firm’s capital under management grows. The firm’s past record-breaking acquisitions include the $265 million portfolio of the Shell Pension Trust in 1998 and the $1 billion purchase of the former National Westminster Bank portfolio in 2000. Earlier this year Coller bought Lucent’s corporate venture portfolio of technology investments, which it has already begun to see returns from due to the $470 million sale of Celiant, a specialist in power amplifiers and radio frequency subsystems for 2G and 3G wireless systems.