A London-listed private equity vehicle managed by Partners Group is heading towards an orderly wind-down after shareholders overwhelmingly opted to have their investments sold and returned as cash, according to a report by Bloomberg.
Investors representing almost 75% of Partners Group Private Equity Ltd’s shares selected the liquidation option, prompting the board to abandon a previously proposed two-class structure and instead seek shareholder approval for a wind-down at meeting on 7 October.
The decision adds to pressure on Partners Group as it restructures investment vehicles containing older private equity assets that have struggled amid higher interest rates and weaker exit markets.
Partners Group Private Equity has been listed on the London Stock Exchange since 2007 and provides retail investors with access to the Swiss firm’s private markets strategies. Like other listed private equity trusts, however, its shares can trade at substantial discounts to the value of the underlying portfolio, creating an additional challenge for investors seeking liquidity.
The portfolio has also faced investment write-downs this year, including holdings in European real estate services provider Emeria and industrial power transmission and conveyor belting company Ammega. Partners Group has also written off its investment in healthcare business Pharmathen.
The proposed wind-down comes as Partners Group attempts to address broader liquidity challenges across its private markets business. A number of wealthy investors in the firm’s evergreen private equity products have sought withdrawals, forcing the manager to impose redemption restrictions.
Partners Group said the proposed solution would address structural issues associated with listed investment vehicles while replicating the characteristics of a traditional closed-end private equity fund. The firm added that several institutional investors in the vehicle had indicated they would continue investing with Partners Group through other strategies.
The Swiss manager is also restructuring a €6.6bn flagship private equity vehicle to balance the competing needs of investors seeking liquidity and those prepared to remain invested. Older assets are being moved into a portfolio focused on generating liquidity through disposals, while a smaller portfolio will concentrate on new investments and seek higher returns for longer-term investors.
Partners Group, which manages approximately $186bn across private equity, private credit, infrastructure and other private markets strategies, has been under pressure as investors reassess the liquidity and performance of private equity products aimed at individual investors.
