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Harken Q1 2013 Private Equity Secondaries Market Update

Boston, MA – May 6, 2013. Harken Capital is pleased to present its Q1 2013 Private Equity Secondaries Market Update.

The summary of secondary bids presents a picture that the secondary market continues to become more competitive, even during periods of slow to moderate activity.  Non-traditional secondary buyers continue to enter the market, buying fund position with an eye toward enhancing overall returns and shortening the J-curve in their investment portfolios.  Often being outbid by strategic buyers for small portfolio sales and one-off sales, secondary funds have shifted their focus on structured solutions and fund recapitalizations.

q1-13

 

Below are some additional observations of Harken Capital’s anlysis of the secondary private equity landscape:

 - Low transaction volume thus far in 2013, mostly small portfolio sales and single fund transactions
 - Capital overhang is estimated at $35bn, could grow to $50bn over the next two years if capital is not deployed
 - Secondary funds are currently seeking another $20bn, resulting in further buying pressure
 - Increased seller activity for Energy and Real Estate funds coupled with buyer sophistication has led to record level pricing
 - Pricing for Mega Buyout has remained competitive, many funds continue to price near par levels
 - Secondary specialists are increasingly using leverage at the transaction level to meet seller’s expectations

With Harken’s dual platform as a placement agent and secondary advisor, we are uniquely positioned in the market to advise on various situations involving secondaries.

About Harken Capital

Harken Capital Securities, LLC (“Harken Capital”) provides fund placement and secondary advisory services to private equity firms and institutional investors. Harken Capital was co-founded by Don Nelson and Fred Malloy and is a member of FINRA and SIPC. The Harken team has over 40 years of experience raising capital for private equity funds, investing as general and limited partners, and advising private equity funds and portfolio companies. Harken team members have raised $2.2 billion in commitments from leading investors around the globe and closed over $1.4 billion in secondary transaction volume.

For more information on our secondary services, contact Nick Hatch at 415-774-6467 or nick@harkencapital.com. For more information on other Harken Capital services, contact Don Nelson at 617-899-2048 or don@harkencapital.com.

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