Some eighteen months after the sale of LGT Asset Management to Amvescap, Liechtenstein Global Trust (LGT) has reaffirmed its commitment to the alternative assets market. The group has formed LGT Capital Management to unite its various alternative and traditional activities under a single umbrella and allocated $400 million (ecu 335 million) of its own capital for investment in alternatives by the new arm. LGT said the move coincides with a marked increase in interest in alternative assets, particularly in Germany and Switzerland.
Last year, LGT established Castle Private Equity, a fund-of-funds for investment in primary and secondary private equity and venture fund positions, which is co-managed by Zug-based Partners Group. Castle Private Equity, which was listed in Luxembourg in September 1997 and obtained a listing on the Swiss stock exchange in September 1998, is capitalised at CHFr 400 million (ecu 250 million). This summer, Castle acquired approximately 50% of Shell Oil Co Pension Trust’s secondaries portfolio, investing in partnership with Coller International Partners II, one of its portfolio funds.
LGT Capital Management will also assume responsibility for Castle Alternative Invest. Established in 1996 and listed in Switzerland since 1997, Castle Alternative Invest is currently capitalised at CHFr 480 million and has built a diversified portfolio of hedge and commodity funds and other non-traditional assets.
The new LGT allocation will be used to build on the group’s existing alternative investment programmes as LGT Capital Management actively pursues investment in primary private equity partnerships, secondary transactions and direct co-investments. The group stated that LGT Capital Management will also serve as a platform for the further expansion of LGT’s core investment management capabilities.
Dr Roberto Paganoni, who joined LGT last year from McKinsey & Co in Zurich, will head the new alternative asset investment unit. Ivan Vercoutere, a former vice president and investment committee member of Pacific Corporate Group, Inc, has joined LGT Capital Management to head the new unit’s private equity investment programme. LGT Capital Management plans to add a number of junior investment professionals to its team before the end of the year.