Patrners Group closes Pearl Holding Limited above target

Pearl Holding Limited, the Luxembourg Stock Exchange-listed convertible bond managed by Zug-based Partners Group, reached a final close at the end of September; the vehicle closed above its Euro 500m target to reach Euro 660m. Partners Group, one of the largest private equity managers and advisors in Europe with SFr 4.5bn under management, supplies a range of tailor-made private equity products for institutional clients. Other vehicles include the listed, AAA-rated, $700m 0%-convertible bond, Princess Private Equity, and the SFr 550m Castle Private Equity AG, a joint venture with Liechtenstein Global Trust LGT. The Pearl Holding Limited vehicle was raised in two tranches: the first from DGZ DekaBank, which supplied Euro 485m in September 2000, and the second from Merrill Lynch which provided the remaining Euro 175m at the end of Summer 2001. The bond is rated AAA by S&P with a guaranteed 2% coupon. This has been achieved through full capital and income protection provided by Swiss Re.

Pearl Holding Limited, a Guernsey-based, closed-end investment company, invests in a diversified range of private equity vehicles. 50% of the bond will be invested in buyout funds, 40% in venture capital vehicles and 10% in special situations, primarily mezzanine funds. The geographical investment distribution will see the vehicle invest 55% in Western Europe, 35% in North America, and 10% in the rest of the world. To attain chronological, as well as geographical, diversification, Partners Group will also look to take secondary positions within buyout portfolios, with particular emphasis on pre-1997 vintage funds, although the majority of its venture capital investment will be in late 2000 and 2001 funds, which have established themselves after the bursting of the technology bubble. Erik Kaas of Partners Group indicates that given the current economic climate, there are an increased number of opportunities in the secondaries market.

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