PE Key Trends Blog

Unexpected Offshoot of New Fund Structures: Longer-Term Investment

Sep 14, 2012 5:47:40 PM / by Robert Ientile posted in co-investment, diversification, holding company funds, Private Equity Market, strategies, V2


In the past three years, private equity strategies have become particularly creative, as LPs look to diversify away from blind pools overly dependent on leverage.

Much of LP diversification has focused on co-investment, the buying and selling of secondaries, deal-by-deal structures and strategies emphasizing yield and short duration, all of which give LPs greater control over investment decisions and offer relatively greater liquidity than investing in a classic leveraged buyout fund. But another emerging trend given a boost by the shortcomings of many credit bubble era funds seems to go in the opposite direction, tying up money for an exceptionally long period.

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