ICG raises $1.1 bln for fund restructurings

Intermediate Capital Group raised $1.1 billion to invest only in fund restructurings and other GP-led secondaries processes.

ICG Strategic Secondaries II Fund eschews traditional LP portfolio sales, which increasingly have been gobbled up by large secondary buyers willing to buy entire portfolios at high valuations.

“The fund restructuring market requires a specialist skill set and a direct PE, asset-focused approach,” Andrew Hawkins, head of ICG’s secondaries group, said in an email response to questions. “Transactions are complex and that is why we believe that a specialist strategy can capitalize on the best opportunities.

“We partner with quality GPs to create win-win-win deals for LPs in older fund vehicles, GPs with assets that require more time/capital, and new buyers seeking quality assets,” Hawkins said.

Fund II surpassed its $1 billion target. It had been in the market since September 2015, said Susan Tether, head of corporate communications at ICG. Fund II is a massive leap from the first pool, which closed on $150 million in January 2015.

Fund II is already about 40 percent deployed across four restructuring deals involving Diamond Castle, Edgestone Capital Partners, Veronis Suhler Stevenson and Third Avenue Management. The London firm expects to close a fifth deal soon, Tether said.

Hawkins leads ICG’s secondaries team. Other executives in the group include Managing Directors Christophe Browne, who joined in 2014 and was a founding partner of NewGlobe Capital Partners, and Ricardo Lombardi, a former senior principal at NewGlobe who joined ICG in 2014.

GP-led processes and direct secondaries represented about 33 percent of deal volume in the first half, up from 26 percent in the year-earlier period, Evercore’s first-half secondary market survey shows. Overall first-half volume hit about $27 billion, up 58 percent from a year earlier, according to the survey of more than 50 respondents.

Greenhill Cogent, which also recently published its first-half volume report, estimated total deal volume at about $22 billion. The adviser said GP-led deals represented less than 15 percent of total market volume.

Action Item: Reach Andrew Hawkins at +44 (0)20 3201 7700

Dawn breaks behind the Houses of Parliament and the statue of Winston Churchill in Westminster, London, on June 24, 2016. Photo courtesy Reuters/Stefan Wermuth