LGT Capital brings sixth secondaries fund to market

LPs are expected to increase sales of their portfolios over the coming year, which could bode well for secondaries funds.

LGT Capital Partners is wasting no time in raising its next secondary pool as market professionals expect a wave of LP and GP dealmaking to hit the market this year.

LPs are expected to increase sales of their portfolios over the coming year, with some sources estimating between $14 billion to $16 billion currently being shopped. One such LP is healthcare provider Kaiser Permanente, which is shopping a portfolio of up to $6 billion, according to sources.

Information about the sixth Crown Global Secondaries fund was included in a presentation made by Cambridge Associates to the Kern County Employees Retirement Association board at its meeting held on February 8. Buyouts watched a broadcast of the meeting. No information was disclosed about the target for Fund VI.

Cambridge’s presentation detailed Kern County’s 2023 private equity plan, which stated the system anticipated making a $30 million re-up in 2023 in its secondaries investing program.

The only secondaries commitment Kern County has made was $50 million to the fifth Crown Global Secondaries Fund in 2020, according to the presentation.

LGT filed a Form D fundraising document for Fund VI in November 2022. The filing did not include a target or the amount raised.

LGT did not respond to comment by press time.

The fifth Crown Global fund was closed in June 2021 at its $4.5 billion hard cap, according to a press release from the Luxembourg-based manager.

LGT Capital has been active in the secondaries market over the past few years. In addition to the Crown Global Secondaries funds, LGT also raised nearly $1.3 billion for its second Crown Secondaries Special Opportunities fund in 2020, which focused on GP-led deals.

In its 2023 outlook, LGT noted that volumes in the secondaries market were higher in the first half of 2022 compared to the year before, driven by pension funds and endowments overallocated to private equity due to the denominator effect.

“Investors are increasingly assessing secondary sales as a practical, or necessary, route to de-risk portfolios,” LGT wrote in the outlook.