Eurazeo disposes of non-core funds

Eurazeo, a French investment firm quoted on the Paris Stock Exchange, has sold a portfolio of 28 “non-core” fund investments to AIG Global Investment Group, a subsidiary of US insurance conglomerate AIG.

The transaction was valued at US$214m, including the assumption of unfunded commitments, and involved funds that are predominantly based in the US (69%), with 29% in Western Europe and 3% around the rest of the world. Eurazeo said that the portfolio was about 91% funded, but did not provide further details on the portfolio.

“Eurazeo has an active hands-on approach and focuses on large European private equity investments,” said Philippe Audouin, a member of the executive board and CFO at Eurazeo. “As part of this strategy, with the sale of its fund interests Eurazeo is finalising the exit of non-core assets as announced previously.”

Press reports have indicated that the sold portfolios included interests in venture capital and real estate.

Secondary sales are becoming increasingly common in private equity, with anecdotal evidence suggesting a global market worth about US$8bn in 2005 that grew substantially last year.

In early 2006, Goldman Sachs Asset Management’s private equity group and the Canada Pension Plan Investment Board paid US$965m for 18% of JPMorgan Chase & Co’s US$5bn interest in the US$6bn JPMorgan Partners Global Fund.

At the end of the year, Star Capital Partners, HBOS and AMP Capital Investors sold the Secondary Market Infrastructure Fund to UK property outsourcing group Land Securities Trillium for £927m.

Last year also saw Pantheon Ventures buying the limited partner interests of two venture capital portfolios from Italy’s Cdb Web Tech and London-based secondary direct investor Vision Capital raise commitments of up to €1bn for its first core fund.