Alderwood Capital mulls significant stake sale in bid to kickstart PE fund

The company is in talks with multiple financial institutions and family offices after suspending fundraising for the investment vehicle amid a difficult economic climate, they said. Ad-hoc discussions started in recent weeks as the business pondered winding down, they added.

A deal would likely take the form of an equity raise, Little and Crawford said, adding that a majority holding could be on the table. The rationale is not to shore up the company's finances but to entice an institution to commit upwards of USD 200m to the investment fund, they said.

However, a wind-down remains a possibility in the event that an anchor investor fails to emerge, the partners noted.

After leaving Northill Capital, Little, an industry veteran, founded Alderwood in 2020 with a view to raising USD 1bn to USD 2bn for a Cayman Islands-domiciled vehicle through which to build minority positions in other boutique asset managers, as reported.

Despite securing north of USD 100m for its fund, Alderwood recently told investors to sit on their hands as commitments did not suffice for a first close, Little and Crawford said. This has resulted in early backer Victory Capital liquidating its 15% shareholding in Alderwood, they said, adding that the two businesses maintain a good relationship.

Victory ceased to be a member of Alderwood on 31 July along with other institutional and individual investors, according to Companies House. It has terminated a previous pledge to inject further capital into the business and USD 50m into its private equity fund, as per an SEC filing. Victory did not return a request for comment.

Should negotiations with a cornerstone investor bear fruit, Alderwood plans to resume marketing for its close-ended fund, though its original fundraising target may be revised down, Little said. "We are focused on getting a viable fund rather than a certain number, so USD 500m+ would be sufficient for a final close," he said. The fund will generally target tickets between USD 50m and USD 150m, he added.

Fund managers like Dyal Capital and Petershill have made a business of investing in other general partners (GPs) to support their growth ambitions or unlock liquidity for their partners.

Unquote sister publication Mergermarket reported last month that Dyal, part of Blue Owl, had upped its existing stake in private credit manager Arcmont Asset Management, providing it with capital to explore inorganic growth and launch new investment strategies.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• GPs
• UK / Ireland
• Fundraising
• Exclusive
• Mergermarket
• United Kingdom