The Partners Group Private Equity (Master Fund) has $6.7 billion in total net assets, making it the largest tender offer fund currently in the market. Partners Group also has a smaller fund: the Partners Group Private Equity Income Opportunities Fund, with $67 million in Net Assets. With these two funds combined, Partners Group accounts for about 22% of total tender offer fund net assets. In this post we’ll take a closer look at the company behind this successful fundraising.
Partners Group Private Equity Master Fund Strategy
Launched in 2009, the Private Equity Master Fund’s objective is long term capital appreciation. Its strategy focuses on direct investments into operating companies, and making primary and secondary investments in private equity funds managed by other managers. The fund also holds small positions in the publicly traded equities of asset managers and private equity firms. The Private Equity Master Fund invests globally, although most of its holdings are in North America. Portfolio planning provides a framework for long term diversification across global PE markets, and is a key part of the fund’s investment process.
This chart from the most recent SEC filing summarizes the portfolio of Partners Group Private Equity Master Fund:
Private Equity is one of the most popular strategies in the Tender Offer Fund database of active funds. So far this has been a successful strategy for Partners Group. Class I shares achieved a total cumulative return of nearly 80% between 2016 and September 2020. Its only down year in the last five was the fiscal year ended March 31, 2020, when it had a 4% drawdown. Although the Covid-19 impacted the portfolio negatively, it has quickly recovered, earning a 22.5% return in the six months ended September 30, 2020. The caveat is that private equity fund performance is subject to smoothing effects because the assets are not marked to market on a regular basis. Nonetheless, a consistent and long track record likely helps with fundraising.
The Partners Group Private Equity Master Fund has two share classes: Class A and Class I. Class A has a 3.5% sales load and a 0.70% distribution fee. Class I does not have any sales load or distribution fee. Both share classes have a 1.50% annual management fee, calculated based on the net asset value of the fund. To learn more about fee structures in unlisted closed end fund, see this earlier post. A Premium Subscription also provides access to a complete database with information on fee structures for all tender offer and interval funds.
Based in Switzerland, Partners Group has over $109 billion in AUM, and more than 20 offices around the world. Its shares are listed on the Swiss Stock Exchange. According to the Partners Group website, their investment approach encompasses private equity, real estate, debt, and infrastructure.
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