France-based fund manager Eurazeo has completed a €108.8 million credit secondaries deal to provide liquidity to investors across three of its funds.
The deal, which involved the establishment of a fund continuation vehicle, was run as a competitive auction conducted by Ely Place, with bidders including traditional LPs, funds of funds and specialist debt secondary buyers.
Global private markets investor Pantheon led the successful investor syndicate, which included Pennington Partners and ODDO BHF Private Equity. Pantheon has a $4 billion private debt platform with a specialist focus on credit secondaries.
Commenting on the transaction, François Lacoste, managing partner and head of private debt at Eurazeo, said: “We are thrilled to announce this successful transaction that delivered an optimal value to both existing and new investors.”
Ely Place founder Daniel Roddick said there were few pools of dedicated capital for debt secondaries in Europe, which was one of the biggest challenges faced in arranging the deal.
“The number of LPs who have told us they have an interest in allocating a small amount of their general allocation to credit secondaries is actually very large,” he explained. “We therefore approached a broad potential buyer universe including primary credit LPs, general secondary buyers, and preferred equity providers, as well as the handful of private debt secondary specialists.”
The portfolio was also a complex mix of senior debt, subordinated debt and equity. With each buyer having their own risk-return targets, they had a strong preference of how much exposure they would accept of each asset type, but Ely Place was able to build a syndicate that could acquire the portfolio intact.