Lehman Brothers Private Equity Partners, a Netherlands-listed fund of funds, saw its per share net asset value decline by 3.3 percent in October to $9.68 per share. Total NAV on 31 October was $518.7 million which is a monthly loss of $20.1 million.
The October loss approaches the fund’s losses for the first three quarters of the year during which time NAV declined by 3.5 percent. At the end of 2007, per share NAV stood at $10.37.
The fund attributed its October losses primarily to negative, unrealised mark-to-market adjustments on credit funds, which contributed to more than half of total losses. Mark downs of publicly listed equity securities and foreign exchange adjustments also contributed to the unrealised losses.
No new private equity investments or co-investments were made for the month. Roughly $24.6 million in capital was called down, 60 percent of which was for distressed investment funds.
LBPE borrowed $100 million from its credit facility to fund ongoing investment activities.
The fund received distributions of $2.2 million, largely from a sale by energy and infrastructure focused buyout fund AIG Highstar Capital II.
Year to date, the LBPE funded capital calls and co-investment of approximately $171 million and received approximately $44 million in distributions.
Lehman’s fund of funds is not part of the reorganisation proceedings of its parent Lehman Brothers, which spiraled into bankruptcy last month after the US government declined to bail it out.
The fund of funds was established in 1984 and manages about $35 billion. It focuses on merchant banking, venture capital, real estate, credit and infrastructure.