Akin Investment Management Team Interviewed by PEI on Secondaries Market

Akin investment management partners Amanda Butler-Jones, Daniel Quinn and Fadi Samman have been profiled by Private Equity International for the article “Regulatory attention shifts to secondaries.”

The in-depth interview focused on activity levels and developments impacting the secondaries market. Themes and highlights from the Q&A include:

Deal activity in the GP-led market

• Daniel: “The market is being driven by the capital constraints that we have seen over the last 12-18 months, which have had both positive and negative impacts on dealflow. A lot of investors looking for additional liquidity view GP-led secondaries as a great way of generating that, while we have also had some sellers hitting the market that are motivated to sell due to capital constraints.”

SEC private fund reforms impact

• Amanda: “The US Securities and Exchange Commission’s rules, in the context of GP-led secondaries, really fall into three buckets: the requirement for a fairness or valuation opinion, the changes to Form PF and the preferential treatment rules.”

LP's assessment of continuation fund deals

• Fadi: “LPs are first and foremost interested in the price. Beyond that, they continue to be focused on making sure the process has been run in a way that ensures alignment. LPs’ questions about GP-led processes reflect their increasing sophistication in this area.”

Key challenges

• Amanda: “GP-led deals are not always straightforward. In multi-asset deals, in particular, the structuring of the transaction and communication to the various counterparties and stakeholders can be challenging for sponsors.”

Commercial dynamics and deals terms for GP-led processes

• Fadi: “Last year we saw both LPs and GPs using GP-led secondaries in a much more purposeful way to address liquidity needs. For the first time, we saw LPs and GPs working together quite openly, talking about secondaries to solve liquidity issues as part of a collaborative process.”

Complexities created by continuation fund processes in the case of co-investments

• Daniel: “It has been interesting to watch the co-investment market catching up with secondaries market practice. Until a few years ago, co-investment documentation did not deal with these transactions at all, but now we see some of the complexities dealt with in the documentation of the co-investment.”

The full article can be accessed here.