Goldman Sachs Raises $15bn to Buy Stakes in Private Equity Funds

Sep 21, 2023 | News

Goldman Sachs’ asset management arm said two funds have closed, raising more than $15bn for funds that enable investors to make secondary investments in existing private equity deals.

Goldman Sachs Asset Management’s “Vintage IX” fund raised $14.2bn, exceeding its target of $12bn, from institutional investors, wealthy clients and bank employees, it said in a statement on Wednesday.

The inaugural Vintage Infrastructure Partners separately raised about $1bn, it said.

 

“What we do in our secondaries business is really go in and provide liquidity to investors in these funds, who wanted to get out before their natural termination,” Harold Hope, global head of secondaries at Goldman Sachs Asset Management, told Reuters.

 

“The vintage fund that we just raised will come in, look at the value of your assets, negotiate with you, agree on a price and then we’ll buy you out of that investment.”

Goldman’s asset management arm is also looking at investing in so-called “continuation vehicles,” he said. Such deals allow PE firms to roll older investments into new funds.

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PE firms are finding it tough to raise fresh money from investors who have already allocated large portions of their portfolios to PE investments, Hope said.

 

“They’re being very cautious around new investments,” he said. “And they’re really not investing a lot of capital. So that’s why I think people are having a hard time raising money.”

The aggregate value of private equity deals plunged 44% to $302.7bn in the first eight months of 2023 from a year earlier, according to S&P Global Market Intelligence, the lowest level for the first eight months of a year since 2019.

 

Source: VCCiRCLE

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