NUS selling US$500 million of PE, property funds to manage liquidity, China exposure

Sales of such portfolios often come with a discount to the net asset value in return for getting the capital sooner

The National University of Singapore (NUS) is divesting at least US$500 million in private equity and real estate funds to manage liquidity and rebalance its China exposure, according to sources with knowledge of the matter.

The university, which has total funds and reserves of more than S$15 billion, is one of the city-state’s largest endowment allocators. Global buyout and China-focused funds are among those it is seeking to sell, the sources said, asking not to be identified as the discussions are private.

Asia asset owners are increasingly turning to the secondary sales market – many for the first time – to shore up liquidity, which has been challenged by lower returns from private equity in recent years. Sales of such portfolios often come with a discount to the net asset value in return for getting the capital sooner.

Funds of Advent International, China tech-focused managers Shunwei Capital and ForeBright Capital, and Hong Kong-based Gaw Capital Partners are among those the university is looking to sell, the sources said. The process is still ongoing and details of the portfolio for sale could change, they added.

Switzerland-based Partners Group is in advanced talks to buy part of the private equity portfolio, a source said. Partners Group more than doubled its private equity secondary investments to US$3.2 billion in 2024 from a year earlier to capitalise on “market dislocation”.

Global buyout funds, which are more diversified in investment geographies, are sometimes offered at a single-digit discount. It is not uncommon for sellers to group a series of portfolios to try to get a more competitive price and not necessarily all the fund investments will get sold, the sources added.

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Deal Street Asia earlier reported that the university, advised by Greenhill, was finalising buyers of a US$500 million portfolio.

Representatives from Greenhill, Advent and Shunwei declined to comment. NUS, Partners Group, ForeBright and Gaw did not immediately respond to requests for comment.

Private credit and infrastructure secondaries typically trade at 5 to 10 per cent discounts, while venture funds hover at around 20 per cent and real estate funds face the deepest cuts, trading down by roughly 30 per cent, noted Wen Ting Geok, head of Asia private equity at Mercer Alternatives, at the Milken Forum in Singapore this month.

Globally, secondary market volume, including deals led by general partners, is estimated to jump 25 per cent to US$210 billion this year, according to a report by advisory firm PJT Partners this month. It estimated secondary market transaction volumes led by asset owners, or limited partners, totalled US$29 billion last quarter.

Earlier this year, Hong Kong Jockey Club initiated a process to unload as much as US$1 billion in funds held with Blackstone and other buyout firms, while sovereign wealth fund China Investment had also looked to offload US$1 billion in positions with firms including Carlyle Group and KKR to reduce US holdings before pulling the sale, Bloomberg News has reported. BLOOMBERG