CVC Capital Partners agreed to acquire secondary buyout specialist Glendower Capital in a deal that will provide one of the most prominent buyout firms with a new strategy to lure investors. CVC and Glendower will combine to create an alternative asset manager with 113 billion euros ($133 billion) under management, according to a statement on Monday. Neither party disclosed financial details of the transaction.
Glendower management won’t cash out and will continue to lead the business independently under Glendower’s name. Bloomberg reported about the potential deal earlier this year. “When CVC approached us initially about the transaction, we wanted to remain independent,” Carlo Pirzio-Biroli, Glendower’s managing partner and chief executive officer, said in an interview. “After engaging in the discussion, we had a hard time figuring out why not to do the transaction.”
The rapid growth of the secondaries market exceeded the firm’s expectations, Pirzio-Biroli said, adding that being part of CVC will help Glendower accelerate its expansion and further institutionalize the business. For CVC, the deal will allow it to offer investors faster returns because the holding periods for secondaries are shorter than for buyouts.
London-based Glendower manages about $8 billion and uses this money to buy existing portfolios of private equity fund holdings. The secondaries market has evolved in recent decades as a way for buyout firms and their investors to rebalance allocations and draw on cash when needed. Secondaries deals valued at a record $48 billion were struck in the first half of the year, according to a July report from Jefferies Financial Group Inc.
