These London-based private equity funds are two of the world's most popular

Wad of Cash

Two London-based private equity houses currently hold the title of managing some of the world's most desirable funds, according to data from private equity marketplace Palico.

Investors who purchased stakes through the secondary market in Permira's Europe IV fund and Vitruvian's Investment Partnership 1 during the first half of 2017 were willing to pay a price which valued the funds at more than their respective net asset value.

This implies that investors are confident that each fund will continue to perform well, and generate a tidy profit for investors when they come to selling off the businesses in their portfolio.

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The private equity secondary market operates by allowing institutional investors who contributed money to a fund to sell their stake, often at a profit if the fund is performing well, to other investors.

Investors looking to buy a stake in Vitruvian Investment Partnership 1, a fund originally raised in 2008, were willing to cough up 108 per cent of the fund's net asset value while those looking for a bite of Permira Europe IV, originally raised in 2006, paid 101 per cent.

The Vitruvian fund's most famous investment was in takeaway meal site JustEat, which it floated in 2014. Permira Europe IV meanwhile backed fashion house Hugo Boss, more than doubling the value of the company's stock during its seven-year hold.

The most in-demand fund in the whole of the first half of 2017, according to Palico's data, was the eighth fund from US firm Clayton Dubilier & Rice which was priced at 115 per cent of net asset value.

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Palico's data sheds light on the 26 big-name private equity funds for which it was able to gather data in the infamously opaque secondary market. The average price being paid for the 26 funds was 95 per cent of net asset value in the first half of this year.

Including the two funds managed by London-based Permira and Vitruvian, 12 were being valued at above their net asset value. Most of these were US-based, although a Chinese firm also featured.

Fund - Price (as a percentage of net asset value)

  • Clayton Dubilier & Rice VIII -  115 per cent
  • Waterland Private Equity Fund V - 113 per cent
  • CVC V - 112 per cent
  • Vista Equity Fund IV - 109 per cent
  • Vitruvian Investment Partnership 1 - 108 per cent
  • Advent International VI - 107 per cent
  • CDH China Fund IV - 106 per cent
  • Blackstone Capital Partners VI - 103 per cent
  • KKR 2006 Fund - 103 per cent
  • TPG Partners VI - 103 per cent
  • Warburg Pincus Private Equity VIII - 102 per cent
  • Permira Europe IV - 101 per cent

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